Created on October 28, 2025

• The British pound struggled to hold gains against the US dollar on Monday, with key technical barriers near $1.34 and support at $1.32.
• Despite mixed sentiment, dollar strength persists ahead of the Fed’s interest rate decision.

The British pound was very noisy during trading on Monday as the market tried to rally, but it just didn’t seem able to hang on to gains. It’s worth noting that the 200-day EMA is in the same neighborhood, which will naturally attract attention as it has offered support a couple of different times. That being said, this is a situation where you have to view the market through the prism of trying to figure out where we are going next. The 200-day EMA offering support and the 50-day EMA offering resistance isn’t unusual, but it’s also notable that the 1.34 level is in the same area, providing an additional barrier.

This week features the Federal Reserve and its interest rate decision, and traders should be mindful of that. Ultimately, despite headline negativity surrounding the US dollar, it has strengthened against the British pound and many other currencies since the FOMC press conference. In other words, the market wasn’t behaving as many expected.

Massive Support Below

The 1.32 level below should act as significant support, and if we were to break down below that point, the British pound could start to fall apart, potentially reaching toward the 1.27 level. Rallies at this point should continue to pay attention to the 50-day EMA, the 1.35 level, and the previous uptrend line. Breaking above that would be very bullish, but for now, it’s important to note that the US dollar continues to show resilience despite all the challenges thrown at it; a trend is visible across multiple currency pairs.

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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.

Created on October 28, 2025

• The euro surged against the yen on Monday, hitting fresh highs as yen weakness spread across markets.
• With risk appetite firm and central bank decisions ahead, traders continue to favor buying dips in this strong uptrend.

The euro rose against the Japanese yen during trading on Monday, or perhaps better put, the Japanese yen has fallen against almost everything on Monday. That being said, we are at a fresh new high, and it does look like the overall momentum still favors buying dips in this pair, as the euro clearly is the obvious winner at this juncture.

The 175.50 yen level underneath should continue to be massive support. And it looks to me like the euro may be trying to get to the 180 yen level before it’s all said and done. You should also keep in mind that there is a Bank of Japan as well as a European Central Bank decision for interest rates this week, and that will cause a lot of volatility. Nonetheless, as long as we have more of a “risk on” type of attitude around the world, it does make sense that we continue to see this one open up to the upside, given enough time.

I Can’t Short

And at this point in time, it’s almost impossible to get short. If we were to break down below the 172 yen level, then maybe we start to fall apart, but it’s going to take a lot to even get to that area. I expect to see a lot of noise. I expect to see a lot of questions asked about everything.

I also expect to see a lot of carry traders continuing to take advantage of the Japanese yen getting eviscerated. The situation between the Americans and the Chinese seems to be cooling off a bit. And if that does in fact end up being the case, then I think you have to look at this as a market that continues to rise as the Japanese yen is considered to be a safety currency.

That is being run from as people are looking for a higher rate of return in almost all assets. All things being equal, this is still an uptrend, and I think that continues to be the case going forward. With that, I think you have to look at this as a market that is long only at the moment.

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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.

Created on October 28, 2025

• Another day, another choppy session for the euro against the US dollar.
• You can see that we did initially rally a bit during the Monday session to reach the 50-day EMA, but turned around to show signs of hesitation.
• The 50-day EMA is a psychologically important technical signal that a lot of people will be watching, and it is worth noting that market participants will be looking at this through the prism of a potential sideways market.

I don’t really think you have a whole lot of momentum here one way or the other, but I would point out that perhaps we could see short-term rallies get faded near the 1.17 level. I also recognize that markets have been doing more of a pro-dollar move since the FOMC meeting than anything else, which is a bit of a surprise because I was told by everybody in the online community that the US dollar was going to fall apart.

And you can see we’ve done pretty much nothing but strengthen since then.

Now the question is, will we bounce from here? Maybe. But keep in mind that the FOMC meeting this week, which will feature possibly a rate cut, but the real question is going to be, what do we do here as far as the press conference is concerned? Because that’s probably the real story. And the press conference, of course, will be late on Wednesday, and traders will be looking for hints to ask them where we go from here.

Jerome Will Drive the Next Move

If they don’t sound dovish enough, you will see the euro get absolutely hammered. It is worth noting that the central banks around the world have quite a bit of volatility in store for the market. We have, of course, the Bank of Canada, the Federal Reserve, the Bank of Japan, and the European Central Bank all presenting their latest interest rate decisions this week. So, I expect a lot of volatility anyways.

The fact that Monday didn’t really have a lot in the way of news probably means it makes a lot of sense that we’re just drifting. By the end of the week, we should have some answers as to where we are going, especially as the Fed and the ECB will both be out of the way. But as things stand right now, it is worth noting that the dollar has held up remarkably well.

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Christopher Lewis has been trading Forex and has over 20 years experience in financial markets. Chris has been a regular contributor to Daily Forex since the early days of the site. He writes about Forex for several online publications, including FX Empire, Investing.com, and his own site, aptly named The Trader Guy. Chris favours technical analysis methods to identify his trades and likes to trade equity indices and commodities as well as Forex. He favours a longer-term trading style, and his trades often last for days or weeks.

• The GBP/USD forecast recovered briefly as the dollar weakened.

• The latest UK retail sales and flash S&P Global PMI boosted the pound, reducing the probability of a rate cut by the BoE. 

• Traders look ahead to the US HPI Y/Y and Consumer Confidence for further impetus. 

The GBP/USD price halted its six-day losing streak, trading above 1.3350 as the dollar weakened on Tuesday. The dollar declined after traders speculated about a 25 basis point cut at Wednesday’s Federal Reserve meeting. 

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The US softer-than-expected inflation data released last Friday reinforced the Fed to start easing its cycle. The Fed is expected to lower the funds rates from 3.75% – 4.00% with another cut expected in December. 

The latest stronger-than-expected UK retail sales and flash S&P Global PMI data lifted the pound sterling in the UK. This suggested progressing business activity and steady consumer spending. Earlier, the softer-than-expected UK CPI hinted at a potential rate cut by the Bank of England. However, these key releases have minimized the expectations of further easing by the BoE. 

Traders anticipate the BoE’s 6th November meeting for further confirmation. Meanwhile, policymakers could follow the same interest rates until they achieve further clarity about the fiscal outlook. However,further clarifyeclining growth will likely put the pound under pressure. 

GBP/USD Daily Key Events

The major events in the day include

• US S&P/CS Composite-20 HPIsignificantUS HPI M/M
• US Richmond Manufacturing Index
• US CB Consumer Confidence

On Tuesday, traders look forward to the US HPI Y/Y and US HPI M/M, Richmond Manufacturing Index, and CB Consumer Confidence to gain insights into inflation, growth, and consumer sentiment. 

GBP/USD Technical Forecast: Rebound Eying 1.3400

The GBP/USD 4-hour chart indicates the pair shows signs of recovery, trading above the 1.3350 level. However, the price stays below the key 200-period MA near 1.3460, signaling a broader bearish bias. 

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The pair’s rebound from the 1.3330 support zone signals short upside momentum. However, the resistance zones near the 50- and 100-period MA around the 1.3360 and 1.3380 levels limits further uptrend. 

The RSI at 54 shows a growing buy limit interest as the pair remains below the overbought region. This signals modest upside potential, which could improve if the pair gains some bullish strength. 

A decisive break above the 1.3380 a3400 levels could trigger an upside towards the next resistance zone. In contrast, a failure to sustain above the short-term MAs could lead to a renewed downtrend.

Support Levels

Resistance Levels

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The EURJPY pair faced difficulty resuming the bullish attack, to form extra barrier at 178.00 level, forcing it to activate the bearish corrective track by reaching 177.25.

Note that suffering extra bearish pressure might force it to break 177.05 level, to confirm its readiness to provide extra corrective trading, to target 176.35 and 175.65 level, while the price success by breaching 178.00 level and holding above it will reinforce the chances of recording extra gains, to expect targeting 178.65 and 179.30 level initially.

The expected trading range for today is between 176.65 and 178.00

Trend forecast: Bearish