US Dollar Extends Gains in London Trading Ahead of FOMC Minutes

Session brief Bullish bias Oct 7, 2026, 07:19 UTC

Claire DuboisEuropean Markets Analyst · ForexR analyst

The US dollar is gaining ground across the board during early London trade, pushing the euro and sterling lower ahead of the FOMC minutes.

Early London Session Performance

The US dollar is finding broad support during the London session, pushing major counterparts and commodities lower across the board. The cryptocurrency space is lagging the wider market considerably, with Ethereum down 2.97% and Bitcoin trading 1.58% lower on the day. Precious metals are also retreating under the weight of the stronger currency, as Gold drops 0.79% to 4131.06. In the foreign exchange market, the greenback is advancing uniformly against the majors, keeping risk-sensitive assets on the defensive. The euro is among the weakest performers in the currency space, shedding 0.33%, closely followed by sterling with a decline of 0.22%. The Australian dollar sits 0.18% lower. Conversely, USD/JPY leads the major pairs on the upside, adding 0.19% to reach 158.366. USD/CAD has also edged higher by 0.12%. As broader market context, US Treasury yields closed yesterday with the 2-year yield at 4.79%, down 5 basis points, and the 10-year yield at 5.27%, down 4 basis points.

Market Overview

Key Technical Setups

EUR/USD Pressure

The euro is trading at 1.12209, positioned between S1 at 1.12151 and the daily pivot at 1.12456. Both the daily and four-hour trends point downward, confirming the current bearish alignment in the pair. A break below S1 could open the way for further declines, keeping the focus on the downside. Conversely, a move back above the daily pivot at 1.12456 would invalidate the immediate bearish view, potentially exposing R1 at 1.12889. The 14-day ATR currently stands at 59.6 pips, giving a measure of recent volatility. The pair has dropped 1.05% over the past five days.

USD/JPY Strength

USD/JPY is advancing at 158.366, having pushed above R1 at 158.273 to trade beyond the top of the pivot ladder. While the daily trend remains mixed, the four-hour trend points up, providing some near-term direction. A continuation of this momentum keeps the pair firmly in bullish territory above R1. However, a failure to sustain these levels and a drop below R1 could see price retrace toward the daily pivot at 158.011, with S1 further down at 157.798. The pair has climbed 0.7% over the past five days.

GBP/USD Under Constraint

Sterling sits at 1.32438, trading between S1 at 1.32209 and the daily pivot at 1.32528. The daily trend is down, though the four-hour trend remains mixed, introducing some near-term indecision to the setup. Should sellers maintain control, a test of S1 at 1.32209 is the next immediate hurdle for the pair. If buyers step in and push the price above the daily pivot at 1.32528, it would negate the downside pressure, opening a path toward R1 at 1.33053. The pair has managed a slight gain of 0.11% over the past five days, contrasting with today's action.

Market Newsflow

Headlines this morning reflect a prevailing theme of US dollar firmness and technical pressure on major pairs, as noted by publishers like FX Street, ExchangeRates, and FXEmpire. Market commentary highlights resistance capping rebounds in the euro and sterling as traders navigate the economic calendar. Observers are also noting technical bearish signals lingering in cross pairs and cautious sentiment in the wider market.

Scheduled Risk Events

Looking ahead, the forex market analysis landscape will be shaped by a mix of European Central Bank appearances and Federal Reserve documentation.

• Today at 07:20 UTC: ECB's Vujčić speech (EUR)
• Today at 17:30 UTC: ECB's Vujčić speech (EUR)
• Today at 18:00 UTC: FOMC Minutes (USD)

Bottom Line

The London session is characterized by universal US dollar strength, keeping pairs like EUR/USD and GBP/USD pinned below their daily pivots. With the daily trends largely supporting the downside for the dollar's rivals, the technical picture aligns with the greenback's advance as the market awaits the FOMC minutes later today.