Forex Today: Jobs Data and Midterms Lead the Agenda

The US Dollar (USD) has fluctuated within a range on Tuesday, reflecting the broader FX market. Trading has remained cautious ahead of the US Midterm elections and key US data releases, with uncertainty over the Middle East crisis persisting.

102.00 remains the key hurdle for the US Dollar Index (DXY). Consolidating just below that level, the index has edged higher on the day, reversing the previous day’s retreat. The regular MBA Mortgage Applications release is scheduled for 4 November. This will be followed by the ADP Employment Change report, Balance of Trade figures, the final S&P Global Services PMI, the ISM Services PMI and the EIA’s weekly US crude oil inventories report. 

A decisive break above the key 1.1200 barrier has continued to elude EUR/USD despite a slight gain. On the data calendar, the final S&P Global Services PMI readings for the EMU and Germany precede the euro bloc’s preliminary Inflation Rate release.

Back above 1.3400 on Tuesday, GBP/USD has prolonged its multi-day rally. The UK calendar contains just one release: the final S&P Global Services PMI.

With its key 200-day SMA near 158.60 in focus, USD/JPY has reached multi-day highs while testing the moving average. Japan’s next scheduled release is the Monetary Base data.

Near 0.6960, AUD/USD has returned to two-week lows under renewed heavy selling pressure. The RBA’s rate hike failed to generate fresh bullish momentum. Household Spending figures are next on Australia’s calendar.

The $93.00-per-barrel level has drawn closer as front-month WTI futures (December contract) extended their decline. Prices have weakened amid speculation that a diplomatic resolution to the US-Iran conflict may be taking shape.

Gold has again breached $3,900 per troy ounce to the downside, giving back part of Monday’s gains. Persistent expectations of further Fed rate hikes and mounting caution ahead of the US Midterm elections results have weighed on the precious metal.