As we head into Tuesday, October 22, 2024, global markets are navigating a volatile environment, driven by key economic events and central bank developments. With traders analyzing the impact of recent U.S. data and ECB communications, the forex market is showing signs of heightened activity across several major currency pairs. Upcoming reports and sentiment indicators will play a critical role in defining market directions.
In the currency markets, the EUR/USD pair declined sharply, reflecting weak Eurozone data and persistent dollar strength. Meanwhile, the GBP/USD pair is under pressure after UK retail sales data came in softer than expected. In contrast, USD/JPY has experienced a rebound as investors shifted back into risk-on mode, reflecting market confidence.
EUR/USD

Technicals in Focus
The EUR/USD pair faced significant selling pressure, closing near the 1.0828 level after failing to maintain upward momentum. Mixed economic signals from the Eurozone continue to weigh on the euro, with markets now focusing on ECB developments later this week. The pair saw a steep sell-off during the session, breaking through critical support levels.
- MACD: Bearish, with the signal line crossing below the zero line, indicating growing bearish momentum.
- Stochastic Oscillator: Entering oversold territory, suggesting a potential corrective bounce.
- RSI (14-day): Neutral, signaling that the pair may consolidate before a decisive move.
Trading Strategy: Neutral to Sell
- Sell below 1.0840-1.0820 with targets at 1.0800-1.0780 and stops above 1.0850.
- Alternatively, consider long positions above 1.0870 with targets at 1.0895-1.0910, and stops below 1.0840.
GBP/USD

Technicals in Focus
The GBP/USD pair dropped to 1.2994, reversing earlier gains as weaker-than-expected retail sales data impacted sentiment. While the pound initially found support above the 1.3000 level, it failed to sustain momentum amid concerns over the UK’s economic outlook.
- MACD: Bearish, with the histogram expanding, reflecting increasing selling pressure.
- Stochastic Oscillator: Hovering near oversold levels, suggesting caution.
- RSI (14-day): Neutral, indicating limited directional momentum.
Trading Strategy: Neutral to Sell
- Sell below 1.3000 with targets at 1.2950-1.2920 and stops above 1.3025.
- Alternatively, consider buying above 1.3030 with targets at 1.3060-1.3080, and stops below 1.3000.
USD/JPY

Technicals in Focus
The USD/JPY pair rebounded strongly, closing near the 150.23 level after reaching session lows around 149.50. The pair’s rally reflects improved risk sentiment as investors digest positive U.S. economic indicators. A shift in sentiment toward the U.S. dollar contributed to the recovery, with further gains likely if risk appetite holds.
- MACD: Bullish, with the signal line crossing above the zero line, confirming upward momentum.
- Stochastic Oscillator: Moving away from oversold levels, indicating room for further gains.
- RSI (14-day): Bullish, reflecting the recent upward trend.
Trading Strategy: Neutral to Buy
- Buy above 150.20 with targets at 150.50-150.80 and stops below 149.90.
- Alternatively, consider selling below 149.40 with targets at 149.10-148.80, and stops above 149.70.
Market Outlook
Looking ahead, attention will turn to U.S. jobless claims and PMI data, which could provide further clarity on the strength of the U.S. economy. In the Eurozone, traders will closely follow ECB speeches and sentiment data for insights into the bank’s future policy direction. The GBP will remain sensitive to Brexit developments and upcoming Bank of England commentary.
Meanwhile, the Japanese yen remains vulnerable to shifts in global sentiment, with potential volatility expected if central banks signal any policy changes. Overall, the forex market is likely to remain volatile, with traders staying alert to new economic data and geopolitical developments.