Market analysis

Date: Monday 12th of October 2026

EUR/USD : US Dollar persistent demand hints at a test of 1.1000 .

GBP/USD : Pound edges up as dollar dips on Treasury pause .

USD/JPY : The Yen is capitalising on the Euro’s weakness .

Dow Jones : Wall Street ends higher, Nasdaq and Dow post weekly gains as oil eases .

Gold : Precious metal finds support but upside potential remains limited .

Crude Oil : Oil prices dip after Trump rules out pre-midterms Iran attack, easing supply fears .

EUR/USD

US Dollar persistent demand hints at a test of 1.1000

The EUR/USD pair maintained its bearish route, edging lower for a fifth consecutive week. The pair traded as low as 1.1161 before trimming some losses, settling on Friday at around 1.1210. Financial markets were once again all about US Dollar (USD) momentum and risk aversion, with government bond yields stealing the limelight while hitting multi-decade highs. Risk aversion sets the tone Demand for government bonds has multiple causes, although risk aversion generally adds the major weight. Investors are looking to hedge against uncertainty, the latter coming from the Middle East crisis and the resulting inflation and energy shocks. Governments also must compete for funding with corporations, particularly seeking capital to expand the AI frenzy. How all this will end remains unclear, which adds to the risk-averse momentum dominating financial boards. Middle East back and forth The Persian Gulf crisis had some ups and downs in the last few days. United States (US) President Donald Trump stated mid-week that a deal with Iran is not something he wants to do, and market talks escalated over a potential attack on Iran. Concerns cooled a bit after President Trump noted he will not attack Iran before mid-term elections, scheduled for November 3. And of course, that’s not enough for the American voter, who is continuously dealing with higher gas prices denting consumers’ sentiment. Public support for the war has declined, and Republicans risk losing control of Congress as the mood sours. Meanwhile , crude Oil prices remain much higher than pre-war levels, with the barrel spiking above $100 after President Trump announced his unwillingness to reach a deal with Tehran. Americans are paying roughly 40% more to fill their tanks, despite supply from the Gulf being near pre-war levels. Around four out of ten barrels of crude now exit the region without going through the Strait of Hormuz, while traffic through the latter has improved significantly. Then, what’s happening? Well, the simplest answer is higher transportation costs. Lingering disruption in the Middle East is forcing major exporters to take up costly means for delivering crude Oil. Such costs are passed on to consumers. Hawkish Federal Reserv e Other than that, the US published the September ISM Services Purchasing Managers’ Index (PMI), which eased to 54.9 from the previous 55.4, also missing the expected 55. The report shows that inflationary pressures remain high, as the Prices Paid Index edged higher to 74 from 72.6 in August. The report, despite being mildly discouraging, did not affect the dominant USD strength. Also , the Federal Open Market Committee (FOMC) published the Minutes of its September meeting. The document showed all voting members supported the 25-basis- point (bps) rate hike, while leaning hawkish, as most members judged that another hike would probably be appropriate by the end of the year. Officials remain concerned about elevated inflation, while seeming more confident about the labor market, considering it is close to full employment. Europe stays afloat, the reasons beyond Euro weakness seem less clear. Still, political turmoil is part of the list. Protests spread in France and Spain amid housing, fiscal, and educational discomfort. The global surge in energy prices amid the Middle East conflict is also affecting the Old Continent alongside the migration situation. The far-right gains ground ahead of French elections next year, while Spanish Prime Minister Pedro Sanchez dissolved the Parliament and called for early elections. Also, German Chancellor Friedrich Merz faces record-low approval ratings, which also results in surging right-wing parties. Political tensions steal the focus from the economy, which anyway is barely holding afloat. Despite the European Central Bank (ECB) early decision to tighten monetary policy, inflation is well above the central bank’s 2% goal. Economic progress remains tepid, and while a recession is out of the picture, the situation is far from optimal. As a result, the EUR's attractiveness is pretty much null.

What’s next on the docket During the upcoming days, data-wise, the focus will be on inflation. Germany will release the final estimate of the September Harmonized Index of Consumer Prices (HICP) on Tuesday, while the US will publish Consumer Price Index (CPI) data for the same month on Wednesday. US September Retail Sales and Producer Price Index (PPI) figures will be out on Thursday, while the Eurozone HICP is scheduled for Friday. Investors will also be keeping an eye on the upcoming US elections and how the odds move. And of course, Oil prices will continue to dictate the market’s sentiment.

Source : https://www.fxstreet.com/analysis/eur-usd-weekly-forecast-us-dollar-persistent-demand-hints-at-a-test-of-11000-202610091525

EUR/USD

GBP/USD

Pound edges up as dollar dips on Treasury pause.

Sterling traded slightly higher on Friday while the euro also firmed, as the dollar lost ground when Treasuries took a breather. The greenback’s slip looks limited. "The dollar lost a bit of ground yesterday as Treasuries took a breather, but we don’t see signs of a broader USD correction brewing," said Francesco Pesole, FX strategist at ING. Pesola added that "global bonds and risk sentiment (are) still looking fragile" and that ING retains "a preference for a slightly stronger dollar in the near term." Oil remains above $100 a barrel, with the market reluctant to price out a geopolitical premium even after U.S. President Donald Trump said the United States would not attack Iran before the Nov. 3 midterms, ING noted. Fed policymakers Alberto Musalem and Christopher Waller both reiterated on Thursday the need to raise rates further, hawkish signals that ING said keep markets "convinced of a December hike." Susan Collins is the only Fed speaker scheduled today, and ING gave no indication of her stance. The University of Michigan surveys are the main U.S. data event, with inflation expectations seen ticking higher and sentiment edging lower. The pound’s gain appears driven by the dollar side, not UK fundamentals. ING’s note cited no UK data, Bank of England comment or domestic political development, and none were provided for this report. ING did note that the euro "isn’t showing any signs of recovery" against sterling, the Swiss franc and the Swedish krona. The greenback’s slip looks limited. "The dollar lost a bit of ground yesterday as Treasuries took a breather, but we don’t see signs of a broader USD correction brewing," said Francesco Pesole, FX strategist at ING. Pesola added that "global bonds and risk sentiment (are) still looking fragile" and that ING retains "a preference for a slightly stronger dollar in the near term." Oil remains above $100 a barrel, with the market reluctant to price out a geopolitical premium even after U.S. President Donald Trump said the United States would not attack Iran before the Nov. 3 midterms, ING noted. Fed policymakers Alberto Musalem and Christopher Waller both reiterated on Thursday the need to raise rates further, hawkish signals that ING said keep markets "convinced of a December hike." Susan Collins is the only Fed speaker scheduled today, and ING gave no indication of her stance. The University of Michigan surveys are the main U.S. data event, with inflation expectations seen ticking higher and sentiment edging lower. The pound’s gain appears driven by the dollar side, not UK fundamentals. ING’s note cited no UK data, Bank of England comment or domestic political development, and none were provided for this report. ING did note that the euro "isn’t showing any signs of recovery" against sterling, the Swiss franc and the Swedish krona.

Source: https://www.investing.com/news/forex-news/sterling-today-pound-edges-up-as-dollar-dips-on-treasury-pause-4940524

GBP/USD

USD/JPY

The Yen is capitalising on the Euro’s weakness

The Japanese currency is falling against the US dollar but strengthening against the euro. The US has been nominally involved in currency interventions. The US dollar continues to be in demand thanks to a strong economy, the attractiveness of its assets and the Fed’s intention to continue its cycle of rate rises. The minutes of the September FOMC meeting noted that a rise in the federal funds rate would be appropriate towards the end of the year. The futures market puts the probability of a rate rise in October at 19% and in December at 86 %. For the Bank of Japan, these figures stand at 5% and 70%. It is most likely that both central banks will postpone rate rises until the end of the year, keeping the bond yield spread wide and supporting USDJPY appreciation. This is more so given that US participation in coordinated interventions has been minimal. The Fed noted that it did not use its own funds to buy the yen but acted merely as an agent for the Treasury. Earlier, US Treasury Secretary Scott Bessent spoke of his department’s nominal participation in foreign exchange market interventions. It appears that Washington and Tokyo have made a mountain out of a molehill, scaring off speculators with talk of coordinated currency intervention. The main burden fell on Japan, which spent around $97.5 billion on USDJPY sales in the month leading up to 26 August. If so, the return of hedge funds to net short positions in the yen after a two-week hiatus appears justified. Divergence in economic growth and the faster rise in US bond yields will contribute to a further strengthening of the dollar. Pressure on the yen is also being exerted by Brent’s reluctance to fall below $100 per barrel. According to a Reuters survey, it is precisely the volatility of the oil market that poses the main threat to Japanese companies. This view was shared by 37% of experts, while 21% cited currency fluctuations and 19% pointed to higher BoJ interest rates. The yen is being supported by a shift in investors’ views regarding the funding currency for carry trades. The euro is increasingly being used for this purpose. The French fiscal crisis is leading to capital outflows and is sending the single currency reeling. EURJPY rates have plummeted to their lowest levels since November. Calls from French politicians for the ECB to cut interest rates are undermining confidence in the euro, reminiscent of Donald Trump’s previous pressure on Powell.

Source: https://www.fxstreet.com/analysis/the-yen-is-capitalising-on-the-euros-weakness-202610081034

USD/JPY

Dow Jones

Wall Street ends higher, Nasdaq and Dow post weekly gains as oil eases

Wall Street’s main indexes rose on Friday, with the Nasdaq Composite and Dow Jones Industrial Average securing weekly gains as technology stocks rebounded and oil prices eased on reduced concerns over Middle East supply disruptions, while a SpaceX spectrum deal hammered telecom shares. The NASDAQ Composite closed at 27,366.17, up 172.83 points, or 0.64%, on Friday, while the Dow Jones Industrial Average gained 423.54 points, or 0.83%, to finish at 51,655.18. Both indexes ended the session higher and secured weekly gains, extending their recovery after technology-led losses earlier in the week. “US equities are recovering Thursday’s losses on two pieces of news that landed overnight. President Trump’s statement that the US will not strike Iran before the midterms took some of the war premium out of crude, with Brent slipping back towards $103," Jesse Marre, Senior Portfolio Manager at Hilbert Group told Investing.com.The University of Michigan’s preliminary October consumer sentiment index fell to 46.3 from 48.1 in September, missing economists’ expectations for a reading of 48, data released on Friday showed. The decline highlighted mounting frustration over living costs and growing concerns about the economic outlook, tempering optimism from the stock market’s recovery. The sentiment index has moved closer to its record low of 44.8, recorded in May. If the decline holds in the final October reading, due later this month, it will mark the second-lowest level on record. Inflation, geopolitical uncertainty and a labor market that has remained relatively stable but has shown limited momentum have weighed on consumer confidence over the past 18 months. The latest reading adds to concerns about household spending, a key driver of the U.S. economy. Technology shares led to the recovery Mega cap technology stocks advanced, helping the broader market recover after Thursday’s technology-led sell-off. Tesla rose 1.8%, Nvidia gained 1.5% and Microsoft added 1.2%, according to Reuters market data. Chipmakers also rebounded after falling sharply a day earlier on reports that OpenAI’s annualized revenue was running at about $20 billion below previously signaled expectations. The revenue debate has raised questions about the pace of AI spending, and the returns companies can generate from their investments, even as investors anticipate strong third-quarter results from technology companies. “Tech is leading the rebound after reports that OpenAI expects to reach $70 billion in annualized revenue by year-end, which eased the worries that gave the Nasdaq its worst day since mid-August yesterday. Today’s gains largely reverse what spooked the market 24 hours ago and after short-term long positioning was reduced, the underlying picture has barely changed," Marre added. Investors also continued to debate OpenAI’s revenue outlook after reports put its annualized revenue at about $50 billion at the end of September, below previously cited expectations, while suggesting enterprise growth could help lift the figure to $70 billion or more by December. In a note, analysts at Vital Knowledge argued that the debate around OpenAI’s revenue is a "function of math" and how top-line figures are calculated, instead of an indication of slowing artificial intelligence demand. However, the analysts flagged that the prior session’s fall in tech stocks could be a sign of "extreme positioning imbalances that have further to unwind [...], which is why the whole AI-linked tech stock complex is unlikely to simply stage a sharp, V-shaped rebound." SpaceX deal hits telecom stocks Telecommunications shares bucked the broader advance after Space Exploration Technologies Corp ( NASDAQ: SPCX ) agreed to acquire a nationwide portfolio of low-band wireless spectrum that could strengthen its Starlink mobile services and intensify competition with established U.S. carriers. SpaceX shares rose 3.2%, while T-Mobile US Inc ( NASDAQ: TMUS ) US plunged 9.1%. AT&T fell 7.4% and Verizon lost 6.3%, reflecting investor concerns about the potential competitive threat from satellite-based connectivity. The communications services sector edged lower, making it the main pocket of weakness in an otherwise broadly positive session. Elsewhere in tech, shares in Apple slumped after Nikkei reported that the company has dialed back on iPhone 18 orders because of tepid demand’s . mobile tower stocks advanced, meanwhile, after SpaceX agreed to buy a nationwide block of low-band spectrum, which analysts at Bernstein said keeps alive the possibility that the satellite company builds a ground network. Telecom carrier stocks such as AT&T and Verizon sank on the news. On a relatively light earnings front, Delta Air Lines slashed its profit forecast as rising fuel costs offset an uptick in fares. Shares in the carrier slipped. The quarterly reporting period is set to begin in earnest next week, when returns from a host of major Wall Street lenders are due to be unveiled.

Source : https://www.investing.com/news/stock-market-news/us-stock-futures-steady-after-nasdaq-slides-on-openai-revenue-concerns-4940052

Dow Jones

Gold

Precious metal finds support but upside potential remains limited

After bearish action seen in the first half of the week, Gold (XAU/USD) staged a recovery to end the week marginally higher. September inflation data from the United States (US) and headlines surrounding the Middle East conflict could drive the precious metal’s action in the near term. Gold benefits from retreating US yields Gold struggled to make a decisive move in either direction on Monday or ended the day virtually unchanged. Rising US Treasury bond yields made it difficult for the precious metal to gather strength, but a risk-averse market atmosphere allowed it to hold its ground amid rising fragmentation fears in the Eurozone. As the 10-year US Treasury bond yield corrected lower on Tuesday, the US Dollar (USD) also weakened against its major rivals. In turn, XAU/USD rebounded modestly to close about 0.6% higher. Following a short-lasting pause, US T-bond yields stretched higher, and the 10-year reference hit its highest level since April 2002 at 5.36% on Wednesday, while Gold dropped below $4,100 for the first time in two months. Later in the American session, the minutes from the Federal Reserve’s (Fed) September policy meeting showed that most participants considered one more interest rate increase by the end of the year likely appropriate. As this development caused US T-bond yields to retreat, Gold managed to erase a small portion of its losses in the second half of the day. On Thursday, crude Oil prices surged higher on news claiming that the Pentagon told US Central Command (CENTCOM) to conclude preparations for resuming major combat operations in Iran. According to Axios, US President Donald Trump hasn't made any final decisions or included a specific date for launching strikes, but the US and Israeli sources said it could happen before the US midterm elections and possibly the Israeli elections a week earlier. Although Gold benefited from an extended correction in bond yields, it failed to gather bullish momentum as this headline revived fears over a deepening conflict in the Middle East and its potential impact on inflation. Nevertheless , in a Truth Social post late Thursday, Trump said that they are having productive discussions with Iran and claimed that Oil is "flowing in record numbers of barrels through the Hormuz Strait." He further clarified that the US won’t attack Iran ahead of the Midterm elections in early November. In the meantime, Fed Governor Christopher Waller said that they need to hike the policy rate further but added that they also need to be flexible about the pace. After closing modestly higher on Thursday, Gold extended its rebound to the $4,200 region on Friday as this headline helped geopolitical tensions ease. According to Deutsche Bank, US Treasuries saw “a sharp intraday turnaround” on Thursday, with the 10-year yield “initially reaching an intraday peak of 5.35%, before ultimately closing down -5.7bps on the day at 5.23%.” The bank adds that “Fed pricing also shifted a bit dovishly,” after Fed Governor Waller remarked that further hikes “do not need to come at consecutive meetings,” prompting investors to reassess the expected pace of tightening. Gold investors await US inflation data Bond markets in the US will remain closed on Monday in observance of the Columbus Day holiday. On Wednesday, the US Bureau of Labor Statistics will publish the Consumer Price Index (CPI) data for September. Investors expect the CPI to rise 0.6% monthly and forecast core CPI to increase by 0.2% in this period. According to the CME Fed Watch Tool, markets are currently pricing in about an 80% probability of a Fed policy held at the next meeting, and a nearly 70% chance of the next rate increase coming in December. While a stronger-than-expected monthly CPI print might not be able to convince markets of a rate hike in October, market positioning suggests that there is room for additional strength if hot inflation data confirms another tightening move before the end of the year. In this scenario, US yields could regain traction and put Gold under bearish pressure. On the other hand, a soft reading could have the opposite effect, opening the door for an extended rebound in the precious metal.

Market participants will continue to pay close attention to headlines coming out of the Middle East. If crude Oil prices continue to edge lower with investors growing increasingly optimistic about an end to the conflict, Gold could gather bullish momentum. Conversely, Oil prices could rise again and Gold could turn south if there are signs of a potential escalation in the conflict.TD Securities analysts note that the current wave of gold buying is being driven by a broad set of macro and geopolitical concerns, including “geopolitical risk, fiscal concern, Dollar debasement, de-dollarization and stagflation concerns.” The bank argues that, given the nature of these drivers, “we expect the appetite to be more persistent and ultimately hold firm in the face of surging real rates.” Against this backdrop, TD Securities adds that “we continue to see the stage being set for Gold to disconnect from real rates further and begin a new bull run into 2027.”

Source: https://www.fxstreet.com/analysis/gold-weekly-forecast-precious-metal-finds-support-but-upside-potential-remains-limited-202610091504

GOLD

Crude Oil

Oil prices dip after Trump rules out pre-midterms Iran attack, easing supply fears

Oil prices inched down on Friday after President Donald Trump said the U.S. would not attack Iran before the midterm elections in November, easing some worries around Middle East supply flows. Over the past one-week period, the Brent contract, the global oil benchmark, was marginally higher. On Thursday, Brent prices climbed by 4%. WTI, meanwhile, is on pace for a weekly decline. In a social media post on Thursday, Trump said that the U.S. would "not be attacking Iran at any time" prior to the upcoming midterm elections. Earlier media reports had suggested that the Pentagon was mulling a possible strike before the November 3 vote, triggering the biggest daily jump in Brent crude in two weeks. However , Trump stressed that the U.S. was having "productive discussions" with Tehran, while Iran’s foreign minister reportedly said they were reviewing a U.S. proposal and would be responding to it within the next few days. “ So both sides acknowledged that talks were happening, which took some of the pressure off oil prices into the close [on Thursday]. Yet even with that, the negative headlines still won out yesterday, and it was clear investors were pricing a longer period of disruption into next year," analysts at Deutsche Bank said in a note. Prices have been volatile throughout this week, swaying through mixed developments out of the Middle East. While shipping data has indicated that oil exporters managed to reach pre-war levels temporarily last month, analysts have flagged that high cost of ferrying oil out of the region and a shortage of refined products is likely to keep energy prices elevated. Meanwhile , concerns remained around the safety of vessels attempting to cross the Strait of Hormuz, a vital waterway through which roughly a fifth of the world’s oil and liquefied natural gas flowed prior to the start of a joint U.S. and Israeli assault on Iran in late February. The conflict appeared to spread as well. Fighting intensified in Yemen between Saudi-led coalition forces and Houthi militants, as both sides battled for control over territory dominating the Bab el-Mandeb Strait, another key regional shipping chokepoint. Houthis also claimed responsibility for attacks on key infrastructure in Saudi Arabia, a major global oil exporter. At the same time, a powerful storm near the U.S. Gulf coast has caused producers in the area to shutter about 1.3 million barrels per day, or 62.9%, of current output, according to U.S. Marine Minerals Administration data cited by Reuters.

Still, top oil importer China is due to resume refined fuel exports following a brief pause during the Golden Week holiday, putting downward pressure on oil prices on Friday, Reuters reported.

Source : https://www.investing.com/news/commodities-news/oil-falls-slightly-after-trump-says-no-iran-attack-before-midterms-4940011

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MAJOR DATA RELEASED DURING LAST WEEK

MAJOR DATA COMING OUT THIS WEEK (Time zone GMT+3)

Disclaimer

Moving Average Convergence/Divergence (MACD):

MACD uses different exponential moving averages to generate buy and sell indicators. The lower pane of the chart shows two lines: a Differential Line and a Signal Line. The Differential Line is the difference between a short and long-period exponential moving average, typically 12 and 26 periods. The Signal Line is typically a 9-period exponential moving average. When the DL crosses the SL from above, a sell indicator is generated, and when it crosses from below a buy signal is generated.

Relative Strength Index (RSI):

This is a momentum indicator that measures a security's price in relation to itself. The lower pane of the chart shows a line that fluctuates on a scale of 0 to 100. Typically buy signals are generated at 30 and sell signals are generated at 70. If the line breaks 30, the security is oversold, and a reversal is imminent. If the line breaks 70, it is overbought and is due for a downward correction.

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