Market Update - 26 October 2022

USD/CAD dives to a three-week low amid the prevalent USD selling bias. Diminishing odds for more aggressive Fed rate hikes weigh on the buck. Subdued oil prices to undermine the loonie and limit losses ahead of BoC. (FXStreet)

EUR/USD gathers extra steam above the parity zone. The dollar remains well on the defensive as risk appetite improves. Consumer Confidence in France surprises to the upside in October. The optimism around the European currency remains well and sound for yet another session and this time lifts EUR/USD to the area beyond the parity level for the first time in the last five weeks on Wednesday. (FXStreet)

GBP/USD climbs to a fresh six-week high and is supported by a combination of factors. The appointment of Rishi Sunak as the new British PM continues to underpin sterling. Diminishing odds for more aggressive Fed rate hikes weigh heavily on the greenback. (FXStreet)

The index extends the weekly leg lower to the vicinity of 110.00. The risk complex picks up extra pace on speculation around Fed’s pivot. Housing data, Trade Balance results next on tap in the docket. The greenback, when gauged by the USD Index (DXY), loses further momentum and approaches the 110.00 area, or 5-week lows, on Wednesday. (FXStreet)

A combination of supporting factors lifts AUD/USD to a nearly three-week high on Wednesday. Hotter-than-expected Australian CPI report boosts the aussie amid sustained USD selling bias. Reduced bets for more aggressive Fed rate hikes and sliding US bond yields weigh on the USD. (FXStreet)

Gold price has faltered on its previous rebound as the US dollar makes a comeback. Cooling aggressive Fed rate hike calls, China concerns and dismal US tech earnings weigh on risk sentiment. XAU/USD sees range play amid battle lines well-defined ahead of critical US events. (FXStreet)

Silver climbs back closer to a nearly two-week high touched on Monday. Bulls await a move beyond the 100-day SMA before placing fresh bets. A break below the $18.00 mark is needed to negate the positive outlook. (FXStreet)

NZD/USD is oscillating in a 12-pip range as investors await US GDP data. US households are bound to postpone their new home demand due to higher interest obligations. ANZ Business Confidence dropped to -42.7 VS. projections of 42.0 and the prior release of -36.7. (FXStreet)

A combination of diverging forces fails to provide any impetus to USD/JPY on Wednesday. The UD languishes near a multi-week low amid a further pullback in the US bond yields. The Fed-BoJ policy divergence continues to act as a tailwind and helps limit the downside. Traders also seem to prefer to wait on the sidelines ahead of the BoJ decision on Thursday. (FXStreet)

Prices of the natural gas extended the rebound from multi-month lows (October 24) amidst rising open interest and volume on Tuesday, hinting at the view that further recovery stays on the cards in the very near term. The next up barrier of note, in the meantime, appears at the 200-day SMA, today at $6.718 per MMBtu. (FXStreet)

Oil prices have picked bids around $84.00 after a corrective move. The EIA is expected to report a build-up of oil inventories by 0.2M barrels. Hawkish monetary policies by global central banks may impact oil demand ahead. (FXStreet)

USD/CAD is consolidating the downside ahead of the BOC expected 75 bps hike. Upbeat Asian markets take the wind out of the USD recovery, WTI trades listlessly. The pair looks to test the 1.3565 support after the rising wedge breakdown. (FXStreet)

Bitcoin appears to be setting an interim base for now and could be gearing up for a minor rebound in the short term. However, there is plenty of resistance ahead that could cap any rebound. Over the past few months, BTC/USD has been holding around quite strong support at the June low of 17590. Despite the hold above the support, BTC/USD has yet to see a meaningful turnaround in momentum. Most recently, there are tentative signs of renewed upward momentum. Any break above immediate resistance at the early-October high of 20465 could open the way towards the September high of 22774. Major resistance is at the August high of 25201, near the 200-day moving average. (DailyFX)

From a relative perspective, ETH/USD Daily charts seem to be one step ahead of BTC/USD. Not only did the former make higher lows in September-October (relative to its own June low), but it has also risen above resistance at 1421. In contrast, BTC retested its June low and is yet to break above its immediate resistance. (DailyFX)

Source: FXStreet, DailyFX

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