April 24, 2025 – Written by Frank Davies

STORY LINK GBP/USD Forecast: Pound Sterling Bullish, Next Resistance at 1.34

The Pound to Dollar exchange rate (GBP/USD) again found support close to 1.3250 and traded close to 1.3300 in Europe on Wednesday as the dollar retreated from Wednesday’s highs.

Volatility has eased to some extent, but underlying stresses remain substantial with choppy trading.

According to Scotiabank; “We look to near-term support between 1.3220 and 1.3250 and resistance between 1.3400 and 1.3420.”

MUFG is still not convinced that there is a lot of mileage in the dollar rebound; “While further steps to water down/reverse tariffs would be positive developments, we are not convinced that recent developments are sufficient yet to support a more sustained rebound for the US dollar at the current juncture.”

There have been further media headlines suggesting that the Trump Administration is planning a more conciliatory stance towards tariffs, although the underlying details have tended to be less favourable, reinforcing uncertainty.

According to Rabobank; “Pantomime policies produce pantomime markets.”

It added; “This has been fully evident in the oscillating price action in recent sessions with Trump’s ‘he’s behind you, oh no he isn’t!’ approach to governing not only prompting market reversals but even arguably resulting in the same driver provoking two diametrically-opposed reactions.”

Scotiabank commented; “The positive spin on trade reflects the reality that, at this point, the US may need an off-ramp more than China does. The Chinese leadership has not picked up the phone for the White House by some accounts and talks with China on trade have not been held even at low diplomatic levels.

It added; “It seems that there is little appetite in China to make concessions and any agreement is a long way off. Relief for the USD may be temporary as trade uncertainty will continue to shade US economic prospects.”

Underlying economic pressures will build quickly amid logistics challenges and pricing pressures.

According to Rabobank; “with a de facto US-China trade embargo in place, the US economy could see shortages on shelves within weeks and/or of price rises; and even if there is a tariff U-turn, logistics would then be overwhelmed.”

The Beige Book reported that the outlook in several districts worsened considerably as economic uncertainty around tariffs rose. Immediate pricing dynamics were little changed, but most Districts noted that firms expected elevated input cost growth resulting from tariffs.

There is still a high degree of uncertainty, especially given lags and attempts to buy goods ahead of price increases and there will be mixed official data in the short term.

At this stage, markets are pricing in just below a 60% chance of a June rate cut, but the Fed will be in a very difficult position if inflation pressures increase.

MUFG commented; “The US dollar could derive more support going forward if the US economy does not slow as much as feared making it harder for the Fed to cut rates as much as currently priced in.”

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TAGS: Pound Dollar Forecasts

April 24, 2025 – Written by David Woodsmith

STORY LINK Euro to Dollar Forecast: Crucial EURUSD Support Near 1.13

After finding support above 1.1300, the Euro to Dollar exchange rate (EUR/USD) posted strong gains to just below 1.14 on Thursday before settling just above 1.1350 as the dollar’s recovery from 3-year lows ran out of steam and better than expected data helped protect the Euro.

Scotiabank commented on the short-term outlook; “EURUSD remains in an uptrend, with a clear sequence of higher lows and higher highs. Recent support has been observed in the 1.1280 area and near-term resistance appears limited ahead of 1.15.”

According to ING; “The 1.130 area is key: in the past couple of weeks, attempted EUR/USD corrections faced heavy buying interest around that level. A decisive break below 1.130 can open the door for a bigger leg lower.”

Goldman Sachs chief economist Jan Hatzius noted the perils of forecasting; “I often dodge questions about the dollar. A large body of academic literature and my own experience as an economic forecaster have taught me that predicting exchange rates is even harder than predicting growth, inflation and interest rates.”

He does, however, have strong views; “But with all due humility, I believe that the recent dollar depreciation of 5% on a broad trade-weighted basis has considerably further to go.”

Hatzius pointed to two historical periods with similar dollar valuations to the present day – the mid-1980s and early 2000s – and these set the stage for a 25-30% depreciation.

Markets are continuing to monitor trade related headlines very closely, but there have been no major developments surrounding tariff talks on Thursday.

MUFG commented; “While further steps to water down/reverse tariffs would be positive developments, we are not convinced that recent developments are sufficient yet to support a more sustained rebound for the US dollar at the current juncture.”

Scotiabank added; “Grounds for optimism on trade should remain in check, I think which will serve to keep the USD on the defensive.”

There was further relatively dovish rhetoric from Fed Governor Waller who stated that he expects tariff-related price increases would be a on-off event and that we would be willing to look through price increases.

Waller also stated that the focus on data brings the risk of being too late on policy action.

The German IFO business confidence index edged higher to 86.9 for April from 86.7 previously and significantly above consensus forecasts of 85.1.

There was a net improvement in the current conditions index with only a small retreat in the expectations component.

According to the IFO; “Uncertainty among the companies has increased. The German economy is preparing for turbulence.”

ING commented; “All in all, today’s Ifo index comes as a positive surprise.”

The bank, however, put this into perspective; “Still, we caution against too premature optimism. There are currently more unknowns than knowns for the German economy, and we continue to expect another year of stagnation – which would mark the first time ever for Germany to go through three consecutive years without growth.”

ECB rhetoric remains relatively dovish with the potential for further rate cuts while there were also reports from within the central bank that is considering changing strategy to enable more nimble moves.

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TAGS: Euro Dollar Forecasts

Created on April 24, 2025

• The British pound has rallied significantly against the Japanese yen during trading on Wednesday, as the ¥190 level has been broken.
• Breaking above the ¥190 level allows for the market to go higher, but I also recognize that this is a situation where traders will have to be somewhat cautious as the risk profile for markets around the world is all over the place.
• As a general rule, this is a market that rallies when people are feeling like taking on more risk, and falls when people are much more cautious.
• As things stand right now, caution makes quite a bit of sense as the markets remained very erratic.

Technical Analysis

Obviously, breaking above the ¥190 level is a very bullish sign, and therefore it does open up the possibility that the British Pound continues to go much higher. The 50 Day EMA is sitting right around the ¥191 level, so that might be our first barrier. If we can clear that area, then the 200 Day EMA, just above the ¥192 level, is your next potential target.

After that, the British pound could go looking to the ¥195 level. This of course would be a major coup for the British pound bulls, and an area that should see a lot of resistance. If we can break above there, then it changes the entire outlook for this pair.

That being said, rallying to the ¥195 level would not be as crazy as it sounds, because it would just be a return to the previous consolidation area that we had been in. After all, this was the ceiling previously for several months, so return to testing that makes quite a bit of sense.

If we were to break down from here, the ¥188 level is very important, and breaking below there could open up a move all the way down to the ¥185 level. While that doesn’t seem as likely, it is something that you need to keep in the back of your mind for potential targeting.

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Created on April 24, 2025

• For two consecutive days, the GBP/USD currency pair has been subject to selling pressure originating from the resistance level of 1.3423, the pair’s highest in six months.
• Losses extending to the support level of 1.3233, around which today’s Thursday trading session is expected to open.
• This comes ahead of a round of US economic releases, led by the announcement of the US weekly jobless claims and US durable goods orders figures, which will be released today, Thursday, at 13:30 Saudi Arabia time.

Sterling Affected by Economic Data Results

According to Forex trading, the British pound declined against most other major currencies following the release of the latest UK services PMI data. The preliminary Purchasing Managers’ Index (PMI) for April revealed a marked decline in the UK’s vital services sector, falling below the 50-point threshold for the first time in 18 months, the dividing line between growth and contraction.

Amid ongoing global disruptions stemming from US President Donald Trump’s tariffs, this month’s services sector data reflected broader economic challenges, leading to decreased demand for the British pound in mid-week trading.

Trading Tips:

The British pound will remain the best performer amid market pressure on the dollar due to Trump’s trade wars, with Britain relatively insulated from the tension.

UK stock prices rebound

According to recent trading and across stock trading platforms, the UK’s FTSE 100 index closed higher by approximately 0.9% at 8,403 points, tracking gains in major stock markets amid trader optimism that trade tensions between the US and China would soon ease. At the same time, concerns about the independence of US monetary policy subsided. Meanwhile, traders monitored the April Manufacturing and Services PMI data, along with major corporate earnings results. The latest data showed UK business activity returning to contraction in April, at its fastest rate in over two years.

According to stock prices, Croda International shares rose by 8.2%, leading the index, after the chemical group reported strong first-quarter sales. On the other hand, Fresnillo shares were among the biggest losers, falling by 5.2%, as the precious metals mining company reported a decrease in silver and gold production in the first quarter despite reaffirming its full-year production outlook.

Technical Analysis for the GBP/USD pair today:

According to recent trading, the GBP/USD pair has recently retreated from its highs near 1.3490, suggesting a potential corrective move within the broader bullish trend. The pair is currently testing key Fibonacci retracement levels that could provide significant support areas for buyers. After reaching overbought conditions, the price has declined towards the 38.2% Fibonacci retracement level at 1.3153, which could offer initial support. Should selling pressure persist, the 50% retracement level at 1.3068 and the 61.8% level at 1.2983 could form the next key support areas. The 61.8% Fibonacci level is particularly important as it coincides with a previous resistance area that could now act as support.

From a broader trend perspective, the GBP/USD pair maintains its bullish structure on the daily timeframe, as evidenced by the series of higher lows and higher highs since March. The 100-day Simple Moving Average (SMA) remains above the 200-day SMA, confirming that the dominant trend is upward.

At the same time, both moving averages are trending upwards, reinforcing the bullish bias. The pair is also trading above an ascending trendline that has supported price action since early March. However, momentum indicators suggest some caution. The Stochastic oscillator is trending downwards from the overbought zone, indicating the potential for continued downward pressure in the near term. Similarly, the Relative Strength Index (RSI) has declined from elevated levels and has room to fall before reaching oversold conditions.

Looking ahead, if the current pullback finds support at any of the aforementioned Fibonacci levels, the GBP/USD pair could resume its bullish trend towards its recent highs and potentially target the 1.3600 area. Conversely, a break below the 61.8% Fibonacci level and the ascending trendline could signal a deeper correction towards the 100% Fibonacci retracement level at 1.2707.

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