The euro held steady as traders awaited the European Central Bank’s decision, with optimism over German data offset by caution on policy signals. The pound weakened amid uncertainty surrounding the Bank of England and renewed U.S. dollar strength after the Fed’s rate cut remarks. The yen remained under pressure as the Bank of Japan maintained its cautious stance, reinforcing dollar dominance. The Australian dollar showed resilience, supported by strong inflation data and expectations that the Reserve Bank of Australia will keep rates steady. Gold traded with limited momentum, pressured by firm Treasury yields and easing demand for safe-haven assets amid improved global sentiment.
🇪🇺/🇺🇸 EUR/USD Outlook – Euro vs U.S. Dollar
Euro awaits ECB clarity amid policy divergence
- The euro remains under moderate pressure as traders await the European Central Bank meeting, where rates are expected to remain unchanged.
- Germany’s employment data exceeded expectations, showing economic resilience, but did not translate into strong euro demand due to cautious sentiment ahead of ECB President Lagarde’s comments.
- Market focus is on whether the ECB will acknowledge growth slowdown risks, which could signal a softer stance.
- Meanwhile, the Federal Reserve’s decision to cut rates by 25 basis points initially weakened the dollar, but Powell’s comments about uncertainty over further cuts restored partial dollar strength.
- Geopolitical tensions and the evolving U.S.-Europe policy divergence continue to weigh on sentiment.
- Support levels: 1.1618, 1.1582, 1.1543
- Resistance levels: 1.1648, 1.1667, 1.1686, 1.1728
- Forecast: Consolidation is likely near support, with potential for a rebound if ECB signals confidence in inflation moderation. Sustained movement below 1.1580 could open further downside pressure.
🇬🇧/🇺🇸 GBP/USD Outlook – British Pound vs U.S. Dollar
Pound weakens under dual pressure from BoE outlook and U.S. strength
- The pound remains on the defensive as expectations for a Bank of England rate cut rise amid slowing domestic momentum and fiscal concerns.
- Lack of fresh UK economic data limited volatility, while attention turned to post-Fed commentary from FOMC members Bowman and Logan, whose remarks may reinforce dollar strength.
- The British government’s upcoming budget adds uncertainty, as possible tightening measures could weigh on economic growth.
- The Fed’s balanced stance—cutting rates while emphasizing restraint on further easing—boosted the dollar’s appeal, keeping GBP under pressure.
- Support levels: 1.3200, 1.3137
- Resistance levels: 1.3247, 1.3291, 1.3328, 1.3365
- Forecast: A sustained break below 1.3200 could trigger further losses toward 1.3130, while any dovish signals from U.S. officials may allow recovery toward 1.33. The overall tone remains bearish.
🇺🇸/🇯🇵 USD/JPY Outlook – U.S. Dollar vs Japanese Yen
Yen depreciates as BoJ stays cautious amid global policy divergence
- The yen weakened further after the Bank of Japan kept its policy rate unchanged, with only two votes favoring an increase, highlighting its gradual normalization stance.
- Governor Ueda’s comments reaffirmed patience, even as inflation remains above target, contrasting sharply with the tightening or neutral tones of other major central banks.
- U.S. yields rose following Powell’s hawkish remarks, further supporting USD/JPY’s climb toward multi-month highs.
- The new Prime Minister’s support for accommodative policy adds a political dimension, reducing expectations of early tightening.
- Support levels: 151.51, 150.87, 150.15
- Resistance levels: 153.27, 154.80
- Forecast: The pair remains bullish above 153.00, with room to test 154.80. A drop below 151.50 would signal the start of a potential correction.
🇦🇺/🇺🇸 AUD/USD Outlook – Australian Dollar vs U.S. Dollar
Aussie steadies as inflation supports RBA’s steady stance
- The Australian dollar retains upward momentum despite U.S. dollar strength, supported by firm domestic inflation data.
- Quarterly CPI figures surpassed forecasts, signaling broad-based price pressures, particularly in housing, utilities, and services.
- These readings reduce the likelihood of any near-term RBA rate cuts, as inflation remains above the target midpoint.
- Diplomatic improvement between the U.S. and China following trade discussions also bolstered risk sentiment, supporting the Aussie.
- However, the Fed’s cautious tone and rising Treasury yields limited gains.
- Support levels: 0.6550, 0.6500
- Resistance levels: 0.6600, 0.6640, 0.6700
- Forecast: As long as the pair holds above 0.6550, upward potential remains intact. A sustained move above 0.6640 could open a path toward 0.6700. Weak Chinese data or renewed U.S. dollar strength could cap further upside.
🌕 Gold (XAU/USD) Outlook – Gold vs U.S. Dollar
Gold softens as yields rise and risk appetite improves
- Gold prices slipped below $3950 as higher U.S. yields and progress in U.S.-China trade talks reduced safe-haven demand.
- The Fed’s comments about uncertainty on additional rate cuts strengthened the dollar, exerting downward pressure on bullion.
- Despite temporary rebounds, gold remains capped below the $3976–$4020 resistance zone, suggesting limited near-term upside.
- Sustained break below $3896 could open a deeper correction toward $3867 or $3750 if yields extend gains.
- However, geopolitical tensions or weak U.S. data could revive safe-haven flows.
- Support levels: 3896, 3867
- Resistance levels: 3976, 4013, 4052, 4162
- Forecast: The medium-term trend leans bearish below 3976, with potential recovery only if gold consolidates above $4020.
📊 Summary Table: As of October 31, 2025
| Asset | Current Bias | Key Drivers | Support Levels | Resistance Levels | Short-Term Forecast |
|---|---|---|---|---|---|
| 🇪🇺 EUR/USD | Neutral to Mildly Bullish | ECB policy stance, Fed tone, Eurozone data | 1.1618 / 1.1582 / 1.1543 | 1.1648 / 1.1667 / 1.1728 | Consolidation with mild upside if ECB remains balanced |
| 🇬🇧 GBP/USD | Bearish | BoE cut expectations, U.S. strength, UK budget risk | 1.3200 / 1.3137 | 1.3247 / 1.3365 | Risk of further decline below 1.32 before stabilizing |
| 🇺🇸 USD/JPY | Bullish | BoJ dovish stance, U.S. yield advantage | 151.51 / 150.87 | 153.27 / 154.80 | Uptrend intact; may test new highs if yields hold firm |
| 🇦🇺 AUD/USD | Neutral to Bullish | Strong inflation, RBA outlook, China sentiment | 0.6550 / 0.6500 | 0.6600 / 0.6640 / 0.6700 | Potential recovery toward 0.67 if global risk appetite improves |
| 🪙 XAU/USD | Bearish | Rising U.S. yields, reduced haven demand | 3896 / 3867 | 3976 / 4013 / 4052 | Downside favored unless price holds above 4020 |
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