The US dollar has skyrocketed against the Japanese yen, breaking above the 145 yen level almost immediately, and now we are threatening that 50 day EMA. Ultimately, I do think this is a situation where traders will eventually try to push this market back to the upside anyways, because quite frankly, the Bank of Japan has a major issue on its hands in the form of a lackluster bond market. They will sooner or later be forced to do a bit of quantitative easing. When they do, the Japanese yen will sink. This is one of the few places that I expect a complete turnaround in the US dollar. So, I like buying dips. I think we will go higher.
AUD/USD Technical Analysis
And yet again, we find ourselves near the 0.6550 level in the Australian dollar. The market broke down below that level for a brief moment, only to turn around and bounce a bit. So, it’ll be interesting to see how this plays out, but I do think you have a situation where traders are going to continue to look at this as a magnet for price. If it can hold for support, then that’s a good sign for the Australian dollar. It could send the Aussie dollar as high as 0.67, we’ll just have to wait and see.
The move higher has been in an extreme grind more than anything else. So, if you’re a short term kind of scalper type of trade aficionado, then you’ll love the Aussie. Clearly, it’s a buy on the dip market, but as far as momentum to the upside, it’s very slow trading indeed.
For a look at all of today’s economic events, check out our economic calendar.
Political jitters in the UK weighed heavily on Pound Sterling on Wednesday.
The near-term technical outlook highlights a lack of bullish momentum.
The US economic calendar will feature Nonfarm Payrolls data for June.
GBP/USD came under heavy bearish pressure on Wednesday and lost about 0.8%. The pair stages a rebound early Thursday but trades well below 1.3700. Markets will keep a close eye on political developments in the UK and scrutinize the June employment report from the US.
British Pound PRICE This week
The table below shows the percentage change of British Pound (GBP) against listed major currencies this week. British Pound was the weakest against the Swiss Franc.
USD
EUR
GBP
JPY
CAD
AUD
NZD
CHF
USD
-0.51%
0.40%
-0.35%
-0.74%
-0.57%
-0.30%
-0.77%
EUR
0.51%
0.89%
0.19%
-0.23%
-0.07%
0.22%
-0.26%
GBP
-0.40%
-0.89%
-0.88%
-1.12%
-0.96%
-0.68%
-1.15%
JPY
0.35%
-0.19%
0.88%
-0.40%
-0.18%
0.08%
-0.38%
CAD
0.74%
0.23%
1.12%
0.40%
0.12%
0.43%
-0.03%
AUD
0.57%
0.07%
0.96%
0.18%
-0.12%
0.28%
-0.19%
NZD
0.30%
-0.22%
0.68%
-0.08%
-0.43%
-0.28%
-0.47%
CHF
0.77%
0.26%
1.15%
0.38%
0.03%
0.19%
0.47%
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
British Prime Minister Keir Starmer’s refusal to guarantee that finance minister Rachel Reeves will remain in her position until the next election triggered a selloff in UK government bonds during the European session on Wednesday, causing Pound Sterling to weaken against its major rivals.
Late Wednesday, Starmer said that Reeves would remain chancellor “for a very long time to come,” easing concerns over a political turmoil. In response, the 10-year UK gilt yield started to correct lower early Thursday after rising nearly 4% on Wednesday and helped GBP/USD find support.
Later in the day, the US Bureau of Labor Statistics is forecast to report an increase of 110,000 in Nonfarm Payrolls (NFP) in June.
According to the CME Group FedWatch Tool, markets are currently pricing in about a 25% probability of the Federal Reserve (Fed) cutting the policy rate by 25 basis points in July. Hence, a positive surprise in NFP, with a print above 150,0000, could confirm a Fed policy-hold in July and help USD gather strength ahead of the July 4 holiday. Conversely, a disappointing reading below 80,000 could hurt the USD with the immediate reaction and open the door for an extended recovery in GBP/USD.
GBP/USD Technical Analysis
GBP/USD stays slightly below the 50-period Simple Moving Average (SMA) and the Relative Strength Index (RSI) indicator remains below 50, reflecting a lack of bullish momentum.
On the downside, 1.3620 (static level) aligns as the next support level before 1.3590 (100-period SMA) and 1.3550 (200-period SMA). Looking north, resistance levels could be spotted at 1.3690-1.3700 (mid-point of the ascending channel, static level), 1.3770 (static level) and 1.3800 (static level, round level).
Pound Sterling FAQs
The Pound Sterling (GBP) is the oldest currency in the world (886 AD) and the official currency of the United Kingdom. It is the fourth most traded unit for foreign exchange (FX) in the world, accounting for 12% of all transactions, averaging $630 billion a day, according to 2022 data.
Its key trading pairs are GBP/USD, also known as ‘Cable’, which accounts for 11% of FX, GBP/JPY, or the ‘Dragon’ as it is known by traders (3%), and EUR/GBP (2%). The Pound Sterling is issued by the Bank of England (BoE).
The single most important factor influencing the value of the Pound Sterling is monetary policy decided by the Bank of England. The BoE bases its decisions on whether it has achieved its primary goal of “price stability” – a steady inflation rate of around 2%. Its primary tool for achieving this is the adjustment of interest rates.
When inflation is too high, the BoE will try to rein it in by raising interest rates, making it more expensive for people and businesses to access credit. This is generally positive for GBP, as higher interest rates make the UK a more attractive place for global investors to park their money.
When inflation falls too low it is a sign economic growth is slowing. In this scenario, the BoE will consider lowering interest rates to cheapen credit so businesses will borrow more to invest in growth-generating projects.
Data releases gauge the health of the economy and can impact the value of the Pound Sterling. Indicators such as GDP, Manufacturing and Services PMIs, and employment can all influence the direction of the GBP.
A strong economy is good for Sterling. Not only does it attract more foreign investment but it may encourage the BoE to put up interest rates, which will directly strengthen GBP. Otherwise, if economic data is weak, the Pound Sterling is likely to fall.
Another significant data release for the Pound Sterling is the Trade Balance. This indicator measures the difference between what a country earns from its exports and what it spends on imports over a given period.
If a country produces highly sought-after exports, its currency will benefit purely from the extra demand created from foreign buyers seeking to purchase these goods. Therefore, a positive net Trade Balance strengthens a currency and vice versa for a negative balance.
The USD/JPY forecast shows a rebound as the dollar gains on trade optimism.
The US economy lost 33,000 private jobs in June.
Economists expect 120,000 new US jobs, a slowdown from the previous month.
The USD/JPY forecast shows a rebound as the dollar gains on trade optimism. However, downbeat employment figures in the previous session led to an increase in Fed rate cut expectations. Market participants are now looking forward to the nonfarm payrolls report.
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The dollar strengthened on Thursday after news of a trade deal between the US and Vietnam. The news raised hopes of more deals before the July 9 deadline for reciprocal tariffs. The progress in trade talks has been slow, and there are concerns that tariffs will increase again soon. Therefore, any new deal boosts market sentiment.
However, the dollar remains under pressure after data in the previous session revealed weak private employment. The economy lost 33,000 private jobs in June. Meanwhile, economists had expected 99,000 new jobs. The report raised concerns about the state of the labor market. At the same time, it increased the likelihood of a Fed rate cut in July.
All eyes are now on the nonfarm payrolls. Economists expect 120,000 new jobs, a slowdown from the previous month. Moreover, unemployment might increase from 4.2% to 4.3%. Softer-than-expected figures will weigh on the dollar by adding pressure on the Fed to lower borrowing costs.
USD/JPY key events today
US average hourly earnings m/m
US nonfarm employment change
US unemployment rate
US ISM services PMI
USD/JPY technical forecast: Price retests trendline after recent break
USD/JPY 4-hour chart
On the technical side, the USD/JPY price has broken below its bullish trendline to make a lower low. The move has strengthened the bearish bias. However, the price has pulled back to retest the recently broken trendline and the 30-SMA. However, the price remains below the SMA, with the RSI under 50, indicating that bears are still in the lead. However, this might change.
The current resistance zone must hold firm to allow the price to bounce lower and confirm the breakout. If this happens, the USD/JPY pair will likely drop to retest the 142.55 support level.
On the other hand, if bulls are stronger, the price will likely break above the resistance zone. Still, to confirm a new bullish move, the price would need to break above the 145.00 resistance level.
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Silver (XAG/USD) followed suit, retreating 0.33% to $36.43 after briefly testing near-weekly highs. The pullback came as markets interpreted the trade developments as a signal of easing global tensions, prompting modest rotation out of defensive assets like gold and silver.
Despite the softer tone, both metals remain underpinned by rising expectations of a dovish shift from the Federal Reserve. The ADP private employment report showed a surprise loss of 33,000 jobs in June—the first monthly decline in more than two years. This follows a weaker-than-expected JOLTS report earlier in the week, reinforcing signs of cooling in the U.S. labour market.
“The labor market is clearly softening, and the Fed may not wait much longer to respond,” said Sarah Mendez, senior macro strategist at Alta Investments. “A weak NFP print on Friday could accelerate expectations of a rate cut as early as September.”
As of Thursday, Fed funds futures suggest a 25% probability of a July rate cut, with market pricing implying a 75% chance of easing by the September FOMC meeting.
While trade optimism has trimmed near-term upside, underlying macro uncertainty and dovish policy shifts continue to anchor demand for precious metals. Friday’s Nonfarm Payrolls report is expected to be the next major catalyst, with markets bracing for increased volatility.
Short-Term Forecast
Gold hovers near $3,366 as traders await U.S. jobs data. Silver holds above $36.33. Fed rate cut bets limit downside despite risk-on sentiment.
The GBPJPY pair is under strong bearish pressure, which forces it to resume the bearish correctional attack, facing the support of the bullish channel’s support at 195.35, to settle above it to stop the negative bleeding in the current period, to rally towards 195.95.
Note that surpassing 196.45 level is important to confirm its readiness to renew the bullish attempts, to expect attacking the extra barrier at 197.45, while the continuation of the negative pressure and breaking the current support will force it to suffer new losses, to wait for reaching 194.20, then attempts to press on the EMA50 that is located near 193.55.
The expected trading range for today is between 195.55 and 197.45
The EURJPY pair didn’t move any thing since yesterday’s trading, to keep fluctuating below the barrier at 169.85 due to its neediness to the positive momentum, but the main stability within the bullish channel’s levels and the continuation of forming extra support at 168.05 level, these factors make us keep the bullish suggestion to keep waiting for gathering extra positive momentum, to ease the mission of breaching the barrier and reaching the next main target near 170.65.
Note that the decline below the mentioned extra support will force it to activate the bearish correctional track, which forces it to suffer several losses by reaching 167.55 followed by the next support at 166.40 level.
The expected trading range for today is between 168.70 and 170.55
The GBPJPY pair is under strong bearish pressure, which forces it to resume the bearish correctional attack, facing the support of the bullish channel’s support at 195.35, to settle above it to stop the negative bleeding in the current period, to rally towards 195.95.
Note that surpassing 196.45 level is important to confirm its readiness to renew the bullish attempts, to expect attacking the extra barrier at 197.45, while the continuation of the negative pressure and breaking the current support will force it to suffer new losses, to wait for reaching 194.20, then attempts to press on the EMA50 that is located near 193.55.
The expected trading range for today is between 195.55 and 197.45
Resistance was seen around the 20-Day MA, now at $3,349, and it was on Tuesday as well. Tuesday’s high of $3,358 needs to be exceeded for the next sign of strength but a daily close today above the 20-Day MA will also confirm strength. That will put gold in a solid position to head toward an interim lower swing high of $3,396 and it looks likely to rise above it. That price level is also a weekly high. So, a breakout above $3,396 will give bullish signals on both time frames.
Recent High of $3,451 is Key Level
The recent lower swing high of $3,451 is the next important price level to assess the condition of the long-term bull trend. If sustained resistance is seen around that price area again, it could lead to additional consolidation before gold attempts another upside breakout. Nonetheless, the integrity of the bull trend has been retained overall, following a brief drop below dynamic support of the uptrend line and 50-Day MA.
Bullish Recovery
A recovery back into a rising trend channel (blue lines) that began on Tuesday is bullish behavior for the short-term and it aligns with the larger pattern showing strong bullish momentum. Therefore, there is the potential for upside momentum to accelerate if the $3,451 high is exceeded. This does not mean it will happen in the foreseeable future, just that it could. If the record high at $3,500 is broken then initial higher targets look to be around $3,578, $3,603, and $3,664.
Bullish Weekly Close Possible
Although this week will be a shorter for gold futures given a U.S. holiday, gold looks likely to end the week in a bullish position near the highs of the week. If that occurs it would provide another sign of strength, with the high for the week being the near-term important resistance level to watch.
For a look at all of today’s economic events, check out our economic calendar.
The GBPJPY pair is under strong bearish pressure, which forces it to resume the bearish correctional attack, facing the support of the bullish channel’s support at 195.35, to settle above it to stop the negative bleeding in the current period, to rally towards 195.95.
Note that surpassing 196.45 level is important to confirm its readiness to renew the bullish attempts, to expect attacking the extra barrier at 197.45, while the continuation of the negative pressure and breaking the current support will force it to suffer new losses, to wait for reaching 194.20, then attempts to press on the EMA50 that is located near 193.55.
The expected trading range for today is between 195.55 and 197.45
The GBPJPY pair is under strong bearish pressure, which forces it to resume the bearish correctional attack, facing the support of the bullish channel’s support at 195.35, to settle above it to stop the negative bleeding in the current period, to rally towards 195.95.
Note that surpassing 196.45 level is important to confirm its readiness to renew the bullish attempts, to expect attacking the extra barrier at 197.45, while the continuation of the negative pressure and breaking the current support will force it to suffer new losses, to wait for reaching 194.20, then attempts to press on the EMA50 that is located near 193.55.
The expected trading range for today is between 195.55 and 197.45
