Commodity FX Surge as Risk Appetite Improves | 29th January, 2026

Commodity FX Rally

Global markets are trading with a constructive risk tone as commodity-linked and high-beta currencies extend their gains. Rising oil prices continue to underpin the Canadian Dollar, while the Australian and New Zealand Dollars draw support from improving domestic fundamentals and shifting rate expectations. Meanwhile, the US Dollar remains on the defensive amid lingering Federal Reserve uncertainty, allowing major pairs to push toward multi-month and cycle highs.

USD/CAD Forecast

Current Price and Context

USD/CAD has slid toward the 1.3530 area, marking its lowest level since October 2024, as strong crude oil prices boost the Canadian Dollar while the US Dollar remains broadly pressured.

Key Drivers

• Oil Prices:Rising crude prices continue to support CAD through improved terms of trade.

•US Dollar Weakness: Softer USD sentiment amid Fed uncertainty weighs on the pair.

•Risk Tone: A constructive global risk backdrop favors commodity-linked currencies.

Technical Outlook

• Trend: Bearish

• Resistance: 1.3600

• Support: 1.3500

• Forecast: Further downside remains possible while below 1.3600.

Sentiment and Catalysts

• Market Sentiment: Bearish USD/CAD

• Catalysts: Oil price movements, US data releases, Fed commentary

NZD/USD Forecast

Current Price and Context

NZD/USD has strengthened above 0.6050, supported by an improved New Zealand Trade Balance that reinforces optimism around external demand.

Key Drivers

•Trade Data: Stronger trade balance supports the Kiwi.

•Risk Appetite: Positive sentiment lifts higher-yielding currencies.

•USD Pressure: Ongoing softness in the US Dollar aids upside momentum.

Technical Outlook

• Trend: Bullish

• Resistance: 0.6100

• Support: 0.6000

• Forecast: Upside bias remains intact while holding above 0.6000.

Sentiment and Catalysts

• Market Sentiment: Constructive

• Catalysts: Global risk sentiment, upcoming US macro data

AUD/USD Forecast

Current Price and Context

AUD/USD has climbed toward 0.7050, driven by rising expectations of further RBA rate hikes following resilient domestic data.

Key Drivers

•RBA Expectations:Markets price in a more hawkish policy outlook.

•Economic Data: Strong local indicators underpin Aussie demand.

•Risk Environment: Supportive risk tone favors the AUD.

Technical Outlook

• Trend: Bullish

• Resistance: 0.7100

• Support: 0.7000

• Forecast: The pair may extend gains if it sustains above the 0.7000 handle.

Sentiment and Catalysts

• Market Sentiment: Bullish AUD

• Catalysts: Australian economic releases, RBA signals

EUR/USD Forecast

Current Price and Context

EUR/USD is gaining traction above 1.1950, supported by persistent uncertainty surrounding the Federal Reserve’s policy outlook.

Key Drivers

•Fed Uncertainty: Expectations of a more cautious Fed weaken the USD.

•Euro Stability: Reduced downside pressure on the Euro supports gains.

•Positioning: Investors favor diversification away from the Dollar.

Technical Outlook

• Trend: Bullish

• Resistance: 1.2000

• Support: 1.1900

• Forecast: A sustained break above 1.2000 could open further upside.

Sentiment and Catalysts

• Market Sentiment: Positive

• Catalysts: US inflation data, Fed communication

GBP/USD Forecast

Current Price and Context

GBP/USD has rebounded toward 1.3850, trading near four-year highs as broader US Dollar weakness supports Sterling.

Key Drivers

•USD Weakness: A softer Dollar remains the primary tailwind.

• Relative Yield Appeal: UK rates continue to support the Pound.

•Market Confidence: Risk-on flows favor higher-beta majors.

Technical Outlook

• Trend: Bullish

• Resistance: 1.3900

• Support: 1.3750

• Forecast: The pair may consolidate near highs before attempting further gains.

Sentiment and Catalysts

• Market Sentiment: Bullish GBP/USD

• Catalysts: UK economic data, US macro developments

Wrap-Up

Overall, price action reflects a market increasingly comfortable with risk, favoring commodity and growth-sensitive currencies over the US Dollar. With oil prices holding firm and central bank expectations in focus, traders will remain attentive to incoming macro data and policy signals that could either reinforce or challenge the current FX momentum in the sessions ahead.

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