Asian Session Summary

The dollar ground higher through Asia on pre-FOMC positioning, with DXY holding above 101.5 on a modest +0.07% gain. The move was broad-based — every G10 pair gave ground to the greenback. Oil was the overnight story: WTI dropped 1.7% to $81.24 and Brent fell 1.9% to $86.68, dragging commodity-linked FX lower and pulling gold down 0.6% to $4,050. The Norwegian krone bore the brunt, with USD/NOK surging 1.25% as crude weakness compounded the dollar bid. Swiss franc weakness stood out on the crosses — USD/CHF climbed 0.45% as safe-haven demand faded on easing tariff rhetoric. Sterling and the antipodeans traded heavy, with GBP/USD and NZD/USD both off more than 0.4%.

Key Pairs for London

USD/NOK — 9.6956 (+1.25%)
The biggest mover in G10 today. Brent’s slide below $87 is doing the damage — Norway’s petroleum-linked economy makes the krone a direct proxy for crude sentiment. The session high at 9.698 is immediate resistance. If oil stabilises into London, a pullback toward 9.65 is possible, but a Brent break below $86 would open 9.75. The move is outsized even for a petro-currency — watch for mean reversion setups if the pace slows.

GBP/USD — 1.3293 (-0.44%)
Cable is testing the bottom of today’s range at 1.3287, the weakest of the major pairs behind the kiwi. The sell-off looks like pre-FOMC dollar accumulation rather than a UK-specific story. The 1.3280 area is the line in the sand for London — a clean break opens 1.3250. For longs, reclaiming 1.3305 (session high) would signal the Asian move was overdone. EUR/GBP ticking up to 0.8550 confirms sterling underperformance within Europe.

USD/CHF — 0.8199 (+0.45%)
The franc is giving back its recent safe-haven premium as tariff fears cool. Headlines confirm the narrative — “Swiss Franc weakens on easing safe-haven demand.” The pair printed a session high right at 0.8200, a round number that will attract attention. A sustained hold above 0.82 into London opens 0.8230. The floor is today’s low at 0.8177. EUR/CHF holding 0.9318 corroborates the move — this is CHF-specific weakness, not just dollar strength.

EUR/USD — 1.1369 (-0.23%)
Drifting lower but not collapsing. The pair is caught between FOMC caution and a still-firm euro macro backdrop. Today’s low at 1.1365 is the first support — a break targets 1.1340. The session high at 1.1383 caps the upside. MUFG’s note flagging “hawkish expectations” into Wednesday’s Fed decision is the consensus trade: buy dollars now, reassess after the statement. London’s job is to test whether 1.1365 holds or cracks.

AUD/USD — 0.6972 (-0.32%)
The Aussie is leaking lower on the commodity drag — copper off 0.17% and oil down sharply isn’t the backdrop AUD longs want. The session low at 0.6966 is immediate support, and a break below 0.6960 would put the 0.6950 handle in play. Today’s high at 0.6998 shows the pair tried and failed to hold 0.70 — that’s now resistance.

London Calendar Watch

Tuesday’s European calendar is light on tier-one releases. The dominant macro driver is positioning ahead of Wednesday’s FOMC decision — the market is pricing a hawkish hold, and any pre-meeting Fed commentary would move the needle. On the European side, ECB speakers could surface given the proximity to the August meeting cycle. UK mortgage approvals and consumer credit data are due later this week but not today. The real event risk is Wednesday — today’s London session is about establishing positioning, not reacting to fresh data.

Bias Going In

The bias is defensive for EUR/USD and GBP/USD into London. Pre-FOMC flows favour the dollar, and the hawkish lean flagged by MUFG gives traders a reason to stay short European FX through Wednesday. Commodity-linked pairs — NOK, AUD, CAD — face additional headwinds from oil weakness, and any further crude deterioration during European hours would extend the NOK sell-off. DXY at 101.5 has room to push toward 101.8 if risk sentiment stays muted, but the move is unlikely to accelerate without a fresh catalyst before tomorrow’s Fed.

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