Forex Today: Markets turn cautious ahead of US data, Gold nears record-high

Here is what you need to know on Tuesday, October 29:

Financial markets seem to have adopted a cautious tone following Monday's choppy action. The US economic calendar will feature Goods Trade Balance and JOLTS Job Openings data for September, alongside the Conference Board's Consumer Confidence Index for October. 

Investors refrain from taking large positions while gearing up for key risk events. Later in the week, third-quarter Gross Domestic Product (GDP) data, Personal Consumption Expenditures (PCE) Price Index figures for September and October employment report from the US will be scrutinized by market participants, who will also keep a close eye on key earnings reports heading into the US presidential election. After closing the first trading day of the week virtually unchanged, the US Dollar (USD) Index continues to move sideways above 104.00. Meanwhile, US stock index futures trade mixed in the early European session.

USD/JPY started the week with a bullish gap as markets reacted to political developments in Japan. After reaching its highest level since late July near 154.00 in the Asian trading hours on Monday, the pair staged a downward correction and closed the day near 153.30. Early Tuesday, USD/JPY continues to edge lower and trades slightly below 153.00. Japan's Finance Minister Katsunobu Kato said on Tuesday that he is closely watching the moves in foreign exchange markets with a higher sense of vigilance, including those driven by speculators. In the meantime, the data from Japan showed that the Unemployment Rate declined to 2.4% in September from 2.5%. 

EUR/USD closed marginally higher on Monday and seems to have entered a consolidation phase slightly above 1.0800 on Tuesday. The European Central Bank (ECB)  Vice President Luis de Guindos said on Monday that the central bank has made significant progress in bringing down inflation but added that they can't declare victory just yet.

GBP/USD failed to gather directional momentum and ended the first day of the week flat. The pair extends its sideways grind above 1.2950 in the European morning. The Bank of England (BoE) will release Consumer Credit data for September later in the session.

AUD/USD posted daily losses on Monday and extended its slide early Tuesday. In the Asian session on Wednesday, third-quarter Consumer Price Index (CPI) data from Australia will be watched closely by investors. At the time of press, the pair was down 0.2% at 0.6570.

Gold benefited from the souring risk mood and registered small gains on Monday. XAU/USD holds its ground early Tuesday and trades within a touching distance of the all-time high it set at $2,758 last Wednesday.