Global forex markets kicked off the week with high drama on Monday, 10 November 2025. The US dollar faltered amid growing optimism that Washington’s prolonged government shutdown might finally end, lifting overall risk sentiment. The euro held near recent highs around $1.157 as improved risk appetite kept the greenback on the back foot. The British pound clawed back from multi-month lows, buoyed by dollar weakness even as the Bank of England’s dovish lean limited its upside. Meanwhile, the Canadian dollar soared on the back of stellar jobs data, driving USD/CAD sharply lower. In this recap, we delve into the technical and fundamental action behind EUR/USD, GBP/USD, and USD/CAD, before tying together the day’s key themes and what lies ahead.
EUR/USD
Technical Analysis
EUR/USD extended its rebound on the short-term charts, with bullish momentum evident on the M5 timeframe. The pair pressed higher after establishing a key floor near 1.1470, marking what analysts suggest could be an important low. On Monday the euro-dollar hovered just below the 1.1600 handle, trading firmly above short-term moving averages – a sign of persistent buying pressure. Momentum indicators were constructive (M5 RSI tilting upward), though the 1.1600–1.1640 region emerged as immediate resistance. A clear break above 1.1640 would confirm a renewed uptrend, while failure to do so could invite a pullback toward support at 1.1520 and the mid-1.14s.
Fundamental Analysis
The euro’s strength on the day was less about European news and more about U.S. developments. In Washington, the Senate advanced a funding bill in a 60-40 vote over the weekend to end the record 40-day federal shutdown, fueling optimism that an official reopening was imminent. This prospect improved global risk appetite and mildly weakened the safe-haven dollar, allowing EUR/USD to hold steady near 1.1570. The Dollar Index (DXY) slipped as traders anticipated a resolution, although rising U.S. Treasury yields and tempered odds of a Federal Reserve rate cut in December kept the greenback’s losses in check. Euro-area news had a muted impact: ECB Vice President Luis de Guindos struck an upbeat tone, saying current interest rates are appropriate with inflation near target, and hinting no policy changes barring a shift in inflation trends. His remarks did little to move the euro, as market focus remained squarely on U.S. fiscal headlines and the broader risk mood. All told, EUR/USD’s mild bullish bias reflected a combination of dollar softness and the euro’s recovery from last week’s U.S. job market jitters, with the pair eyeing a potential test of the mid-1.16s if positive momentum continues.
GBP/USD
Technical Analysis
Sterling mounted a tentative rebound on Monday, with GBP/USD rising from last week’s depths as short-term momentum turned positive. The 5-minute chart illustrates the pair’s climb off a six-month low near 1.3000, forming a double-bottom base in the low-1.30s before recovering into the mid-1.31s. In early intraday trading, 1.3155 proved to be a stubborn resistance ceiling, halting advances as overbought signals emerged on the lower timeframes. The pullback from that level saw the pound gather strength while leaning on its 50-period moving average for support. Despite the bullish corrective wave on an intraday basis, upside momentum remained fragile – the pound needs a clear break above 1.3170 to signal a more decisive trend reversal. Key support rests around 1.3100, with any dip back toward the 1.3000 psychological zone likely to attract buyers after the recent bottoming pattern.
Fundamental Analysis
The pound’s modest recovery was underpinned in part by the softer USD, but domestic factors kept sterling’s gains in check. Last week, the Bank of England held interest rates at 4.00% but struck a distinctly dovish tone – the MPC’s vote split and post-meeting hints from Governor Andrew Bailey suggest the Bank is poised to cut rates in December, pending the new fiscal budget’s impact. This outlook of an impending BoE easing cycle has weighed heavily on GBP sentiment, contributing to the sharp drop to the 1.30 area earlier in the week. By Monday, however, some of that pessimism was tempered as the dollar’s weakness gave sterling room to breathe. GBP/USD managed to recover to ~1.3165 into the start of the week, although investors remain cautious. U.K. data releases were light on the day, leaving traders to focus on the broader narrative: a tug-of-war between a potentially weakening USD and the pound’s own headwinds from Britain’s slowing economy and looming policy easing. With UK quarterly growth figures and labor market data due later in the week, the pound’s respite may be short-lived if those indicators disappoint. For now, sterling is fighting to maintain its foothold above 1.3100, even as the specter of BoE rate cuts caps any exuberance.
USD/CAD
Technical Analysis
The USD/CAD pair flipped into retreat, extending a steep corrective pullback from last week’s highs. Short-term charts reveal a double-top formation that has marked a near-term peak for USD/CAD. Coming off a rally that saw the pair test seven-month highs above 1.41 in the first week of November, bullish momentum stalled and reversed sharply. The M5 technical picture on Monday was decidedly bearish: after failing to sustain gains, USD/CAD broke below its 50-period EMA support, confirming the negative trend shift. The downside pressure intensified on a wave of strong selling, with the pair slicing through 1.4050 and drifting toward the lower 1.40 handle. Momentum indicators flashed bearish signals (despite briefly entering oversold territory intraday), reflecting the dominance of this corrective wave. Initial support emerges around 1.4000, and below that around 1.3920 (near last week’s lows), while any rebounds will likely find resistance at 1.4080 – a level that had been a pivotal breakout point on the way up. The overall technical bias has shifted south in the short term, as the Canadian dollar flexes its strength.
Fundamental Analysis
The catalyst for the loonie’s surge – and USD/CAD’s decline – was unmistakable: blowout Canadian employment data. On Friday, Statistics Canada shocked markets by reporting a +66.6K jump in jobs for October, defying expectations of a slight employment drop. The unemployment rate ticked down to 6.9% from 7.1%, marking an improvement after months of stagnation. These robust numbers suggested Canada’s economy is more resilient than thought, prompting traders to scale back bets on near-term rate cuts from the Bank of Canada. The Canadian dollar was the day’s strongest major currency, buoyed by this positive domestic backdrop. In contrast, the U.S. dollar remained on the defensive amid the swirl of political developments in Washington. Hopes that the record 40-day U.S. federal shutdown was on the verge of resolution kept the greenback “calm” and somewhat softer, further aiding USD/CAD’s descent. There was also discouraging U.S. data to consider: the preliminary Michigan Consumer Sentiment Index plunged to 50.3 in November – a 3½-year low – reflecting the toll of the prolonged shutdown on consumer confidence. All these factors combined to push USD/CAD down about 0.3% on the day, with the pair trading around 1.4025–1.4030 by Monday’s close. Traders will watch if a potential U.S. government reopening reverses some of the USD’s losses, but for now the loonie’s strong fundamentals have firmly tilted this pair in favor of the Canadian currency.
Market Outlook
Monday’s forex action underscored a common theme across EUR/USD, GBP/USD, and USD/CAD: the influence of a faltering U.S. dollar amid shifting economic currents. The prospect of an end to the U.S. government shutdown injected markets with a dose of risk-on optimism, sapping some demand for the dollar as a safe haven. Both the euro and pound capitalized on this dollar weakness – the euro by extending its fledgling rally off recent lows, and the pound by recovering from oversold levels near $1.30. However, their trajectories diverge when it comes to central bank outlooks. The ECB appears content with policy on hold for now, giving the euro room to track broader USD moves. In contrast, the Bank of England’s tilt toward easing means sterling faces an uphill battle; any fresh signs of UK economic weakness could quickly revive sell-offs in the pound. On the other side of the ledger, the Canadian dollar stood out as a market darling, fueled by domestic strength. Canada’s impressive job gains have bought the BoC some credibility in holding rates steady, positioning the loonie to outperform – especially if U.S. data remain clouded by the recent blackout of government statistics.
Looking ahead, traders will be closely watching upcoming catalysts to see if Monday’s trends hold. A formal agreement to end the U.S. fiscal impasse would likely boost global sentiment, but it could also restore the flow of U.S. economic data – which might sway Fed rate expectations and potentially lend support back to the dollar if the numbers impress. Key reports later in the week, such as UK GDP and Eurozone industrial data, as well as any remarks from Fed officials, could introduce new volatility. For now, EUR/USD bulls are eyeing a breakout above the mid-1.16s, pound traders hope the worst is over near 1.30, and USD/CAD bears are testing how far a confident loonie can carry the pair lower. As Monday’s drama showed, shifting macro narratives can ignite sudden forex moves. If optimism around a U.S. budget deal persists and economic data (especially in Canada) remain solid, the dollar may stay on its back foot – setting the stage for the euro and loonie to continue outperforming, while the pound fights to maintain its hard-won recovery. The stage is set for an eventful week, with currency traders poised for the next act in this ever-evolving market saga.