Created on October 16, 2025

• The US dollar has fallen pretty significantly during the trading session on Wednesday against the Japanese yen, but we are still extraordinarily elevated.
• With that being the case, I’m still looking for a little bit of a bounce that I can take advantage of, and we are starting to get it late in the session.
• The question is, will it be enough to really start buying into? I don’t know.

I think maybe we have a little further to go. I will let the market just tell me what it’s going to do. But right now, I know that I don’t want to get short of this pair. The 150 yen level would be interesting. The 149 yen level would be even more interesting. If we just bounce from here, then we may find ourselves consolidating a bit between the 151 yen level and the 153 yen level, trying to get our footing on this breakout.

Major Rectangle Below, and Possible Triangle

We previously had a major rectangle that we gapped out of whether or not we fill that gap remains to be seen. Typically, you do. So that is something that you want to pay attention to. But I also recognize that you can make an argument that we just broke out of a triangle and that could signify a massive move in this pair. In fact, you could be looking at somewhere in the neighborhood of a move to about 162 yen. That would be basically back where we fell in July of 2024. So, we’ll just have to wait and see.

Regardless, I do think that this is a buy on the dip market, and I do recognize that you get paid to sit at the end of the day with the swap interest rate differential. And at this point, I’m just looking for a nice entry, and I will get long again.

Want to trade our USD/JPY forex analysis and predictions? Here’s a list of forex brokers in Japan to check out.

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 16, 2025

EUR/USD Analysis Summary Today

• General Trend: Bearish.
• Today’s Support Points for EUR/USD: 1.1600 – 1.1560 – 1.1480.
• Today’s Resistance Points for EUR/USD: 1.1680 – 1.1730 – 1.1800.

EUR/USD Trading Signals:

• Buy EURUSD from the support level of 1.1550, target 1.1780, and stop 1.1470.
• Sell EURUSD from the resistance level of 1.1760, target 1.1500, and stop 1.1820.

Technical Analysis of EUR/USD Today:

Based on recent trading, the EUR/USD pair has formed a double bottom pattern on the short-term chart, suggesting the possibility of a reversal from the previous bearish trend. Across trading company platforms, the Euro/Dollar pair appears to be testing the neckline resistance at the key psychological level of 1.1600, and a breakout of this area could confirm a shift in direction. If the neckline is successfully broken, the EUR/USD pair could rise by the same height as the double bottom formation. However, the price may encounter resistance from the nearby descending trend line and the dynamic pivot point of the 100 Simple Moving Average (SMA), which could trigger a pullback before the upward trend gains momentum.

At the same time, the indicated area of interest on the chart shows where sellers could take a stand, but continued buying pressure outside this area suggests buyers are ready to take control. A strong break above the descending trend line and the moving averages could pave the way for a move towards higher levels. Regarding moving averages, the 100-day SMA remains below the 200-day SMA, indicating that the path of least resistance is still bearish, or that downward momentum may continue. However, the gap between the indicators appears to be narrowing, suggesting a potential bullish crossover is on the horizon. Furthermore, this confirms increasing buyer interest.

The Stochastic indicator for EUR/USD performance is hovering near the overbought zone, reflecting strong upward momentum at the moment. A decline of the oscillator from this area could signal buyer exhaustion, potentially leading to a rebound. On the other hand, if the Stochastic remains high, it would indicate that buyers are still in control. The Relative Strength Index (RSI) is also trending higher, so the price may continue to follow the same approach with buyers having the upper hand. However, the oscillator has limited room to climb before reaching the overbought zone, meaning that the upward momentum may start to fade soon.

Trading Tips:

Keep in mind that the rebound in the Euro/Dollar price still lacks strong momentum to confirm its occurrence, and the 1.1800 resistance will remain the most crucial to confirm an upward shift. Therefore, carefully monitor the factors influencing the currency exchange rate.

Dollar Retreats After Federal Reserve Signals

According to Forex currency market trading, the U.S. dollar fell after the Federal Reserve’s “Beige Book” report boosted expectations for further U.S. interest rate cuts. The report showed slowing economic growth, persistently weak labor market conditions, and rising prices for input costs. Indicators of tariff implementation varied, with some companies keeping selling prices unchanged, while others reported an increase in import costs.

According to expert views on the report, the “Beige Book” generally reinforces the view that the economic outlook has not changed much since the Fed’s September meeting. They suggest that this keeps the Fed on track to cut U.S. interest rates by 25 basis points later this month, and likely again in December.

According to reliable trading company platforms, the U.S. Dollar Index (DXY) fell by 0.2% to 98.596 after recording a one-week low of 98.417 on Wednesday.

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Created on October 16, 2025

• The British pound initially fell during the trading session on Wednesday, breaking below the ¥200 level, only to turn around and show signs of life.
• The market ends up forming a hammer on both Tuesday and potentially Wednesday now, suggesting that the buyers are in fact starting to fight back.
• The Japanese yen got a little bit of a boost after some members of the Bank of Japan suggested that perhaps they would have to do something about the weakness of the Japanese yen, but at this point in time the Japanese cannot afford higher interest rates of any real circumstance, as the Japanese economy is far too indebted to carry that load.

Pullback

I think this pullback makes a certain amount of sense considering that the ¥205 level offered significant resistance that we are now seeing a bit of a pullback. The question is whether or not we can pick up any momentum to the upside. If we do, then I’m a buyer of this pair because of the pullback giving me an opportunity to get involved in a obvious move to the upside, and of course a massive amount of interest rate differential that comes into the picture. The 50 Day EMA currently sits at the ¥200 level, so that makes that level even more important, and I think it’ll be interesting to see if we can stay above there. As long as we stay above the ¥200 level, then I think it’s a “buy on the dips” market, but I don’t necessarily think I would throw a ton of money into this market right away.

I think this is the beginning of something bigger, and the question will be how much further can it go to the upside? I think at this point in time the ¥210 level is a very reasonable target, surprise me if we end up going much higher than that. I have no interest in shorting this market until we break down below the ¥198 level, something that doesn’t seem very likely at the moment.

Begin trading our daily forecasts and analysis. Here is a list of Forex brokers in Japan to work with.

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 EURJPY pair confirmed the continuation of the bullish scenario by providing new close above the extra support at 175.20 level, forming bullish moves by reaching 176.00.

Note that the continuation of the main indicators’ contradiction might force the price to provide new sideways fluctuated moves, but its success in surpassing the intraday barrier near 176.45 might increase the efficiency of the bullish track, to target 177.05 level reaching the achieved top at 177.90.

The expected trading range for today is between 175.50 and 176.45

Trend forecast: Fluctuated within the bullish track

The EURJPY pair confirmed the continuation of the bullish scenario by providing new close above the extra support at 175.20 level, forming bullish moves by reaching 176.00.

Note that the continuation of the main indicators’ contradiction might force the price to provide new sideways fluctuated moves, but its success in surpassing the intraday barrier near 176.45 might increase the efficiency of the bullish track, to target 177.05 level reaching the achieved top at 177.90.

The expected trading range for today is between 175.50 and 176.45

Trend forecast: Fluctuated within the bullish track