Dollar Eases Into a Five-Central-Bank Week, USD/JPY Holds Near 157, EUR/USD Stalls at 1.1220 and USD/CAD Tests 1.4000 | Technical Analysis – Forex Report | 26 Oct 2026
Forex Today | Monday 26 October 2026
Dollar Eases Into a Five-Central-Bank Week, USD/JPY Holds Near 157, EUR/USD Stalls at 1.1220 and USD/CAD Tests 1.4000
Market Overview
The dollar drifted lower in Asian trade on Monday as five central banks meet this week. At about 06:45 GMT, EUR/USD was 1.1220 (+0.15%), GBP/USD 1.3380 (+0.02%), USD/JPY 156.94 (+0.06%), USD/CAD 1.4007 (0.00%) and AUD/USD 0.7030 (−0.06%), while USD/CHF printed 0.8239 (−0.13%) on the chart feed. The dollar index is near 101.5, the US 10-year yield about 5.1%, and the Fed is expected to hold on Wednesday with roughly 80% odds of a December hike. Oil near $100 and US-Iran headlines keep inflation and rate fears alive, while a Nasdaq sell-off and weaker risk appetite support the yen and franc. We read the session as a dollar pause inside broader ranges, with the Bank of Canada, Fed, ECB and Bank of Japan decisions the next catalysts.
Key highlights
- USD/JPY: Price is 156.94 under three falling averages and holds a triangle floor near 156.40; BoJ on Friday is the swing factor.
- AUD/USD: Price is 0.7030 at the falling roof and the 0.7074 average; RBA hike talk supports dips toward 0.6980.
- EUR/USD: Price is 1.1220 under the 1.1226 short average and channel roof; weak PMIs and French spreads weigh.
- GBP/USD: Price is 1.3380 under the 1.3390 averages and above the 1.3278 short average; RSI 55.35 is firm.
- USD/CAD: Price is 1.4007 on the 1.4045 and 1.4016 averages with RSI 38.61; the BoC hike is the test.
- USD/CHF: Price is 0.8239 on the rising channel floor with 0.8197 as the key support.
What’s Moving Forex Today
Dollar index slips toward 101.5 as Fed week opens with a hold expected
The dollar index fell about 0.17% in Asia after touching an 18-month high earlier in October. The Fed starts a two-day meeting on Tuesday and is expected to hold at 3.75%–4.00% on Wednesday, with markets giving about a 90% chance of a hold and roughly 80% odds of a December hike. The 10-year Treasury yield is near 5.1% and Chair Kevin Warsh’s comments are the focus.
Yen steadies near 157 as safe-haven demand returns before the Bank of Japan
USD/JPY stalled below 157 after Friday’s dip to its lowest since 18 September. The BoJ is expected to hold at 1.25% on Friday with a hawkish outlook, and markets already attach substantial odds to a December hike as fuel subsidies end. Growth worries, a Dow-led fall in US stocks and a Nasdaq sell-off on AI spending fears are also helping the yen.
EUR/USD stuck near 1.1220 as French bond stress and weak PMIs offset a softer dollar
EUR/USD closed last week at 1.1203, down 0.3%, after Friday’s flash eurozone composite PMI fell to a four-month low and the French reading dropped under 50. The France–Germany 10-year spread is near 161 basis points, the widest since 2011, and the ECB is about 97% likely to hold at 2.50% on Thursday.
USD/CAD holds 1.4000 as BoC hike odds near 80% and oil near $100 back the loonie
Governor Macklem’s warning on inflation lifted odds of a 25 basis point hike to 2.50% on Wednesday to about 80%, although only 19 of 34 economists in a Reuters poll expect it. Reports say the US may remove 50% tariffs on some Canadian products as early as today, and the pair has fallen for six sessions from 1.4298.
AUD/USD sits near a one-month high above 0.7000 as RBA’s Hunter says the job is not done
RBA Assistant Governor Hunter said inflation is not yet beaten after four hikes and a November rise is in view. Australian Q3 CPI on Wednesday at 00:30 GMT is the next test, while weaker risk appetite and the central bank-heavy week keep the Aussie range-bound.
GBP/USD steadies near 1.3380 with the Fed on Wednesday and the Bank of England on 5 November
Sterling is holding its rebound from the mid-October low near 1.3130 and is at a 16-month high against the euro. A softer dollar helps, but traders wait for the Fed and the BoE’s 5 November decision; Cambridge Currencies also lists a UK Budget on 28 October.
USD/CHF returns to its channel floor as the franc gains against the euro
EUR/CHF has broken its March–May trendline and tests its 200-day average near 0.9235, a sign that investors are defensive about Europe. USD/CHF fell about 0.13% to 0.8239 on the chart, but with the SNB at 0% and the Fed leaning toward hikes, the rate gap still favors the dollar.
Key Drivers Ahead
Eight events that set direction for USD/JPY, AUD/USD, EUR/USD, GBP/USD, USD/CAD and USD/CHF. All times are GMT.
- Iran talks / Hormuz
- Ongoing
- Any time
- Trump said there would be no strike today; headline swings move oil, the dollar and the yen
- US tariffs on Canada
- Today
- Any time
- Report says some 50% tariffs on Canadian goods may be removed; CAD-supportive
- Australian Q3 CPI
- Quarterly
- Sets the tone for the RBA’s November hike view
- Bank of Canada decision
- 28 Oct
- Hike to 2.50% about 80% priced; new projections published
- FOMC decision
- 28 Oct
- Hold expected; December hike odds near 80%
- ECB decision
- 29 Oct
- Hold at 2.50% about 97% priced; French bond stress in focus
- US Q3 GDP and PCE
- Thu
- Growth and inflation data feed December Fed hike pricing
- Bank of Japan decision
- 30 Oct
- Fri 30 Oct, about 03:00 GMT
- Hold at 1.25% expected; Ueda’s wording on December is key
Swipe the strip to see every driver.
Trade Setups for Today
Ranked in the order USD/JPY, AUD/USD, EUR/USD, GBP/USD, USD/CAD and USD/CHF, valid for today’s session. A 1-hour close beyond the stop cancels the idea.
| Instrument | Direction | Entry | Stop | Target 1 | Target 2 | Reward:risk | Conviction |
|---|---|---|---|---|---|---|---|
| USD/JPY | Short | 157.85 | 158.60 | 156.40 | 155.20 | 1.9 / 3.5 | Medium |
| AUD/USD | Short | 0.7070 | 0.7120 | 0.6980 | 0.6905 | 1.8 / 3.3 | Low |
| EUR/USD | Short | 1.1255 | 1.1310 | 1.1150 | 1.1095 | 1.9 / 2.9 | Medium |
| GBP/USD | Long | 1.3280 | 1.3205 | 1.3400 | 1.3500 | 1.6 / 2.9 | Low |
| USD/CAD | Short | 1.4050 | 1.4110 | 1.3965 | 1.3860 | 1.4 / 3.2 | Medium |
| USD/CHF | Long | 0.8200 | 0.8140 | 0.8290 | 0.8390 | 1.5 / 3.2 | Medium |
Reward:risk is the distance from entry to each target divided by the distance from entry to the stop. Prices are read at about 06:36–06:42 GMT on 26 October from the daily charts; every entry sits away from the current price and needs a pullback or a bounce to trigger. Levels are conditional technical references, not recommendations.
Risk Scenario Analysis
The Fed on 28 October, Hormuz headlines and the Bank of Canada decision are the swing factors, with Australian CPI at 00:30 GMT on Wednesday the first test.
Hawkish Fed and a Hormuz escalation: higher yields, a firmer dollar and rising inflation fears
A hawkish message confirming a December hike would lift yields and the dollar, pushing the euro, sterling and Aussie to their lower supports.
- USD/JPY157.86, then 159.30
- AUD/USD0.6980, then 0.6905
- EUR/USD1.1113, then 1.1000
- GBP/USD1.3280, then 1.3200
- USD/CAD1.4045, then 1.4170
- USD/CHF0.8291, then 0.8390
A dovish hold and a Hormuz deal: softer yields, a weaker dollar and a relief rally in risk currencies
A cautious Fed and a credible US-Iran agreement would pull yields lower and let the majors recover toward their resistance zones.
- USD/JPY156.40, then 155.20
- AUD/USD0.7074, then 0.7170
- EUR/USD1.1260, then 1.1355
- GBP/USD1.3400, then 1.3500
- USD/CAD1.3965, then 1.3927
- USD/CHF0.8197, then 0.8138
USD/JPY | FXCM feed
USD/JPY Analysis: Price Holds the Floor of a Narrowing Triangle Beneath Three Falling Averages
156.94 +0.10 (+0.06%) at about 06:45 GMT Day range 156.65–157.22
Outlook: Bias is lower while 157.86 caps rallies. USD/JPY stalls near 157 after Friday’s dip to its lowest since 18 September, as the yen regains safe-haven demand on growth worries and traders wait for a hawkish hold from the Bank of Japan on Friday.
Key levels
- Support 2
- 155.20
- Support 1
- 156.40
- Resistance 1
- 157.86
- Resistance 2
- 159.30
- Price (157.03 on the chart) is under the 157.86, 157.50 and 159.30 averages; the short average also sits against the falling roof near 158.3, so 157.86 is the first hurdle for any bounce.
- RSI 43.71 is under its signal line at 51.68, a soft reading that is not oversold; a close under 156.40 opens 155.20 and then the 153 September low, while a close over 158.3 would break the triangle roof.
Setup: Short at 157.85, stop 158.60, targets 156.40 and 155.20. Reward:risk 1.9 / 3.5, medium conviction. A Fed hold with a December hike still priced keeps the dollar bid, but the BoJ’s hawkish tone and safe-haven flows cap the pair under the averages.
AUD/USD | OANDA feed
AUD/USD Analysis: Price Rebounds Above 0.7000 and Meets the Falling Roof and Two Longer Averages
0.7030 −0.0004 (−0.06%) at about 06:45 GMT Day range 0.7022–0.7040
Outlook: Bias is neutral to lower while 0.7074 caps rallies. The Australian dollar sits near a one-month high above 0.7000 on fresh dollar selling, and RBA Assistant Governor Hunter says the inflation job is not done, but risk aversion and Wednesday’s Australian CPI can swing the pair either way.
Key levels
- Support 2
- 0.6905
- Support 1
- 0.6978
- Resistance 1
- 0.7074
- Resistance 2
- 0.7170
- Price (0.7026 on the chart) is just under the 0.7033 and 0.7074 averages and above the 0.6978 short average; the falling roof near 0.7040 and the 0.7074 average form one supply zone.
- RSI 52.30 is above its signal line at 43.42, a firm reading that is not overbought; a close over 0.7074 targets 0.7170, while a close under 0.6978 puts the 0.6905 floor back in play.
Setup: Short at 0.7070, stop 0.7120, targets 0.6980 and 0.6905. Reward:risk 1.8 / 3.3, low conviction. A rejection at the roof and the 0.7074 average is the cleaner entry; a daily close over 0.7120 cancels the idea because the RBA tone is supportive.
EUR/USD | FXCM feed
EUR/USD Analysis: Price Presses the Roof of a Falling Channel Under a Short Average Near 1.1226
1.1220 +0.0017 (+0.15%) at about 06:45 GMT Day range 1.1202–1.1227
Outlook: Bias is lower while 1.1260 caps rallies. EUR/USD is steady near 1.1220 on a softer dollar, but weak flash PMIs, French bond stress and a likely ECB hold on Thursday leave the euro with little support.
Key levels
- Support 2
- 1.1000
- Support 1
- 1.1113
- Resistance 1
- 1.1260
- Resistance 2
- 1.1355
- Price (1.1216 on the chart) is under the 1.1226, 1.1428 and 1.1447 averages; the short average sits on the channel roof, and the 23.6% retracement near 1.1254 adds to the cap at 1.1260.
- RSI 39.89 is above its signal line at 32.97 after leaving oversold ground, but stays under 50; the 2026 low of 1.1113 from 14 October is the first floor, with the 200-week average near 1.1105 just beneath it.
Setup: Short at 1.1255, stop 1.1310, targets 1.1150 and 1.1095. Reward:risk 1.9 / 2.9, medium conviction. A retest of the channel roof and the 1.1260 zone is the entry; a daily close over 1.1310 would break the channel and cancel the idea.
GBP/USD | FXCM feed
GBP/USD Analysis: Price Rebounds Above Its Short Average and Stalls Under Two Longer Averages Near 1.3390
1.3380 +0.0003 (+0.02%) at about 06:45 GMT Day range 1.3350–1.3388
Outlook: Bias is neutral while 1.3280 holds and 1.3400 caps. Sterling has recovered from the mid-October low near 1.3130 and is steady near 1.3380 against a softer dollar, with the Fed on Wednesday and the Bank of England on 5 November the next tests.
Key levels
- Support 2
- 1.3200
- Support 1
- 1.3280
- Resistance 1
- 1.3400
- Resistance 2
- 1.3500
- Price (1.3373 on the chart) is under the 1.3399 and 1.3387 averages and above the rising 1.3278 short average, which is the nearest dip-buying zone.
- RSI 55.35 is above its signal line at 47.50, a firm reading that is not overbought; a close over 1.3400 targets 1.3500 near the broken channel, while a close under 1.3280 opens 1.3200 and the October low near 1.3130.
Setup: Long at 1.3280, stop 1.3205, targets 1.3400 and 1.3500. Reward:risk 1.6 / 2.9, low conviction. This is a buy-the-dip idea on the short average; a close under 1.3205 cancels it, and a Fed surprise could break the range either way.
USD/CAD | OANDA feed
USD/CAD Analysis: Price Slides to the Two Longer Averages After Rejection at the 1.43 Roof
1.4007 0.0000 (0.00%) at about 06:45 GMT Day range 1.3999–1.4045
Outlook: Bias is lower while 1.4045 caps rallies. USD/CAD is near 1.4000 after six straight falls from the 1.4298 high, as a roughly 80% chance of a Bank of Canada hike on Wednesday and oil near $100 support the loonie.
Key levels
- Support 2
- 1.3860
- Support 1
- 1.3965
- Resistance 1
- 1.4045
- Resistance 2
- 1.4170
- Price (1.4012 on the chart) is on the 1.4045 and 1.4016 averages and well under the 1.4170 short average; support is the 38.2% retracement near 1.3986 and the swing low near 1.3965.
- RSI 38.61 is far under its signal line at 53.77, a weak reading that is not oversold; the weekly 55-period average near 1.3927 is the key threshold, and a close under it opens 1.3792 and the channel floor.
Setup: Short at 1.4050, stop 1.4110, targets 1.3965 and 1.3860. Reward:risk 1.4 / 3.2, medium conviction. A bounce into the 1.4045 average is the entry; a BoC hold or a cautious outlook could lift the pair, so a close over 1.4110 cancels the idea.
USD/CHF | FXCM feed
USD/CHF Analysis: Price Holds the Floor of a Rising Channel Above Its Two Longer Averages
0.8238 −0.00106 (−0.13%) at about 06:45 GMT Day range 0.8229–0.8253
Outlook: Bias is neutral to higher while 0.8197 holds. USD/CHF has pulled back from the 0.84 high of early October to the floor of its rising channel as the franc gains against the euro, but the wide gap between US and Swiss rates still favors the dollar.
Key levels
- Support 2
- 0.8138
- Support 1
- 0.8197
- Resistance 1
- 0.8291
- Resistance 2
- 0.8390
- Price (0.8239 on the chart) is under the falling 0.8291 short average and above the 0.8197 and 0.8138 averages, which also sit on the channel floor.
- RSI 47.76 is under its signal line at 54.14, a neutral reading; a close over 0.8291 targets the 0.8390 October high, while a close under 0.8197 would break the floor and open 0.8138.
Setup: Long at 0.8200, stop 0.8140, targets 0.8290 and 0.8390. Reward:risk 1.5 / 3.2, medium conviction. A pullback to the channel floor is the entry; a close under 0.8140 breaks the channel and cancels the idea. Quote shown is the 06:42 GMT chart price because a live quote was not available.
Conclusion
USD/JPY, EUR/USD and USD/CAD trade under falling averages or channel roofs, so we prefer selling bounces into 157.85, 1.1255 and 1.4050, while AUD/USD is a lower-conviction fade of the 0.7070 supply zone. GBP/USD and USD/CHF are the two dip-buying ideas, on the 1.3280 short average and the 0.8200 channel floor. The nearest risks are Australian CPI at 00:30 GMT and the Bank of Canada at 13:45 GMT on Wednesday, the Fed at 18:00 GMT that day, US GDP and PCE at 12:30 GMT and the ECB at 13:15 GMT on Thursday, and the Bank of Japan on Friday. A daily close over 158.30 in USD/JPY or under 1.3965 in USD/CAD would change the picture.
Trade USD/JPY, AUD/USD, EUR/USD, GBP/USD, USD/CAD and USD/CHF with Capital Street FX.
Frequently Asked Questions
Why is USD/JPY stuck near 157 before the Bank of Japan?
The pair sits in a narrowing triangle between a falling roof near 158.3 and a floor near 156.4. A Fed hold with December hike odds near 80% supports the dollar, while a hawkish BoJ on Friday and safe-haven demand support the yen.
Will the Bank of Canada hike on 28 October, and what does it mean for USD/CAD?
Markets price about an 80% chance of a 25 basis point hike to 2.50%, although a Reuters poll found only 19 of 34 economists expecting it. A hike with firm projections could push USD/CAD under 1.3965 toward 1.3927, while a hold could send it back to 1.4045.
Where is support for EUR/USD?
The 2026 low of 1.1113 from 14 October is the first floor, with the 200-week average near 1.1105 just under it and 1.1000 below that. Resistance is the channel roof and 1.1260, then 1.1355.
How could the 28 October Fed meeting affect these pairs?
A hold is expected. A hawkish message confirming a December hike would lift yields and the dollar, pushing EUR/USD, GBP/USD and AUD/USD toward their lower supports and USD/JPY toward 157.86. A cautious tone would do the opposite.
