• EUR/USD trades in a tight channel below 1.1600 on Monday.
• The US Dollar came under heavy selling pressure after US employment data.
• The technical outlook highlights sellers’ hesitancy in the near term.

After spending the majority of the previous week under heavy selling pressure, EUR/USD gathered bullish momentum on Friday and gained about 1.5% on a daily basis. The pair stays in a consolidation phase below 1.1600 in the European morning on Monday.

The dismal July employment report from the US triggered a US Dollar (USD) selloff ahead of the weekend, fuelling a rally in EUR/USD.

The US Bureau of Labor Statistics (BLS) announced that Nonfarm Payrolls (NFP) rose by 73,000 in July, missing analysts’ estimate of 110,000. On a more concerning note, the BSL revised down May and June NFP increases by 125,000 and 133,000, respectively.

In response, US President Donald Trump fired BLS Chief Erika McEntarfer, accusing her of manipulating the numbers for political purposes.

According to the CME FedWatch Tool, the probability of a 25 basis points Federal Reserve (Fed) rate cut in September jumped above 70% from about 30% before the data, weighing on US Treasury bond yields and the USD.

June Factory Orders will be the only data featured in the US economic calendar on Monday, which is unlikely to trigger a market reaction.

Meanwhile, investors will pay close attention to political developments in the US. US President Donald Trump is expected to announce a replacement for Fed Governor Adriana Kugler, who decided to resign. Kugler’s term was scheduled to end on January 31, 2026.

In case markets grown increasingly concerned about the Fed and the BLS losing independence, the USD could have a difficult time staying resilient against its rivals.

EUR/USD Technical Analysis

The Relative Strength Index (RSI) indicator on the 4-hour chart holds above 50, highlighting sellers’ hesitancy. However, EUR/USD remains below the 50-period, 100-period and the 200-period Simple Moving Averages (SMAs), suggesting that buyers are yet to be convinced of a steady rebound.

On the upside, 1.1630 (100-period SMA) aligns as the first resistance before 1.1650-1.1660 (Fibonacci 23.6% retracement, 200-period SMA) and 1.1700 (static level, round level). Looking south, support levels could be seen at 1.1540 (Fibonacci 38.2% retracement), 1.1500 (static level, round level) ad 1.1450 (Fibonacci 50% retracement).

Created on August 04, 2025

• The British pound collapsed pretty significantly against the Japanese yen during the trading session on Friday, slicing through the crucial ¥198 level, an area that short-term traders have been watching very closely.
• Because of this, I think it suggests that perhaps market participants are going more “risk off”, as the Japanese yen is considered to be a safety currency.

Technical Analysis

The technical analysis for this pair is obviously in a state of flux as we just printed a massive red candlestick. A nasty red candlestick for the trading session on Friday might be enough to entice buyers, but quite frankly I think it’s asking a lot for markets to suddenly turn around. It’s very possible that the British pound could drop to the 200 Day EMA which is at the ¥194.23 level, before bouncing again. It’ll be interesting to see if that actually plays out, but I also recognize that a lot of this comes down to risk appetite overall.

The ¥198 level above probably ends up being a major barrier, but if we can break above there then we will threaten the ¥200 level again. Keep in mind that the area in the 200 point range has been resistant a couple of times in the past, so one has to ask questions as to whether or not we just found the top of a longer-term consolidation area that might hold. If we break down below the 200 Day EMA, we could very well see this market drop down to the ¥187.50 level, maybe even as low as the ¥184.50 level. This will almost certainly have everything to do with risk appetite and the overall attitude of markets in general. After all, there are a lot of different things going on at the same time, and this does have a lot of traders somewhat concerned. Ultimately, I think we’ve got a situation where traders are looking at this through the prism of a wondering whether or not the markets are about to see a major shift in attitude.

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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.

Important DisclaimersThe content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party’s services, and does not assume responsibility for your use of any such third party’s website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.Risk DisclaimersThis website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.

• The GBP/USD weekly forecast suggests further downside.

• The US economy grew by 3.0%, compared to the forecast of 2.5%.

• The dollar retreated on Friday after data revealed slower-than-expected job growth in July.

The GBP/USD weekly forecast suggests further downside as market participants prepare for a Bank of England rate cut.

Ups and downs of GBP/USD 

The GBP/USD price had a bearish week as the dollar strengthened on upbeat data and higher tariffs. However, there was a pullback after the nonfarm payrolls report. 

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At the start of the week, data revealed solid private employment. At the same time, the economy grew by 3.0%, compared to the forecast of 2.5%. The data boosted the dollar. Moreover, Trump imposed higher tariffs on several countries, which sent Treasury yields and the dollar higher. 

However, the dollar retreated on Friday after data revealed slower-than-expected job growth in July.

Next week’s key events for GBP/USD

Next week’s calendar for GBP/USD is quite light. Market participants will focus on the Bank of England policy meeting, where the central bank might cut interest rates by 25-bps. The pound had a bad month in July as traders worried about the state of the UK economy. 

Despite being among the first countries to sign a trade deal with the US, the UK’s currency has suffered amid poor economic data. The weak reports have led to an increase in expectations for Bank of England rate cuts.

GBP/USD weekly technical forecast: Lower low confirms new downtrend

On the technical side, the GBP/USD price trades well below the 22-SMA, showing bears are in the lead. At the same time, the RSI trades below 50, indicating solid bearish momentum. At the same time, the price recently broke below the 1.3402 support level to form a lower low. This confirms a bearish trend. 

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Previously, the price was in a bullish trend that paused near the 1.3803 key level. Bears took charge by breaking below the 22-SMA and respecting it as resistance. The bearish bias is strong, especially since the price has confirmed a new downtrend. 

Currently, the price has paused after making a lower low. It might pull back to retest the recently broken 1.3402 level before dropping to fresh lows. The next target for GBP/USD is at the 1.3001 key support level. A break below will strengthen the bearish bias.

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USD/JPY Technical Analysis

The US dollar has gotten slammed against the Japanese yen during the trading session here on Friday as well, as now it looks like the reaction is going to cause chaos. That being said, I think there’s still support underneath, and I think it’s only a matter of time before the support could come into the picture at the 200 day EMA and the 148 yen level, but we’ll just have to wait and see how that plays out. If we turn around and start rallying again, we could go looking at the 151 yen level. At this point, I still prefer the upside for now, but we’ll see how this plays out over the next couple of days.

AUD/USD Technical Analysis

The Australian dollar rallied and looked like it’s going to try to break the top of an inverted hammer. We’ll have to wait and see how this closes. But if it closes above the 50 day EMA, that would be a bullish sign for the Aussie. That being said, if the job situation in the United States continues to deteriorate, that actually quite often will make the US dollar stronger over the longer term because people run into buy treasuries. If the US jobs numbers and the job market starts to crumble, the rest of the world goes with it.

Typically, what we see is a month or two of strength in other places and then it starts to show up in their economy. There’s an old adage that says, when the US sneezes, the world catches a cold. I’ve been told multiple times in the last 18 years that that’s no longer true. And every time it happens, it ends up being true. So do keep that in mind. I think strength in other currencies could be a short-term thing. I can really see that environment. But over the longer term, if this keeps up, people run to the Treasury market, so keep that in mind.

For a look at all of today’s economic events, check out our economic calendar.

Important DisclaimersThe content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party’s services, and does not assume responsibility for your use of any such third party’s website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.Risk DisclaimersThis website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.

The price of (EURUSD) rose slightly in its last intraday trading, attempting to recover its early losses, to offload some of its clear oversold levels on the (RSI), especially with the emergence of positive signals that reinforce the chances for intraday stability.

This limited rise comes amid the continuation of the dominance of bearish correctional wave, indicating the superiority of the selling powers on the trading in the near-term basis, imposing restrictions on any attempts for recovery.

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STORY LINK GBP/USD Forecast: Pound Surges Against Dollar as US Jobs Slows Sharply

The US Dollar dived after the latest US jobs data, and the Pound to Dollar (GBP/USD) exchange rate recovered from 10-week lows near 1.3140 to just above the 1.3300 level in an immediate reaction.

Another important element, however, was a decline in equity markets and a weaker tone surrounding risk appetite with unease over US tariff developments amplifying the impact of the jobs shock.

Weaker risk appetite hampered the Pound in global markets and GBP/USD settled around 1.3265.

The latest US jobs data recorded an increase in July non-farm payrolls of 73,000 compared with market expectations of just over 100,000.

There were big revisions with the June increase downgraded to 14,000 from the provisional reading of 147,000.

For May and June, there was a huge downward revision of 258,000 jobs.

ING commented; “This puts a completely different light on what has been happening in the US economy post the 2 April ‘Liberation Day’ announcements.”

The latest ISM manufacturing business confidence data was also weaker than expected, increasing reservations over the outlook.

There has been a big shift in expectations surrounding Fed policy with markets now pricing in close to an 80% chance that rates will be cut at the September meeting compared with less than 40% ahead of the data which undermined the dollar.

Markets had been broadly unruffled by the latest tariff developments, but the payrolls revisions put a slightly different perspective on the outlook.

Trump pressure on Fed Chair Powell is also likely to intensify.

“The July employment report was a dud. Nonfarm payrolls rose by 73K in July, short of expectations and coming on the heels of sharp downward revisions to the prior two months” say economists at Wells Fargo.

“The unemployment rate rose to 4.2% from 4.1%, and the labor force participation rate ticked lower for the third straight month,” added Sarah House, Senior Economist at Wells Fargo.

“Coming into today’s report, our base case forecast was that the FOMC would cut the federal funds rate by 25 bps at its September, October and December meetings, with no additional rate cuts in 2026. Based on today’s data, we are inclined to leave that projection unchanged for now.”

The latest US jobs data delivered a stark reassessment of recent labour market strength.

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TAGS: Pound Dollar Forecasts

Created on August 01, 2025

• Taking a look at the US dollar against the Japanese yen, the US dollar has initially fallen during the trading session on Thursday, which makes a certain amount of sense considering that there was a Bank of Japan meeting.
• So, people were a bit cautious. That being said, we turned around to show signs of life, and now we have exploded towards the 150.5 yen level.
• If we can break above the 151 yen level, then I think the US dollar really starts to take off against the Japanese yen, as the yen itself is in serious trouble from what I can see.

Measured Move Coming?

If you take the measured move of the previous ascending triangle that we broke out of, we’re probably looking at about 156.5 yen, all things being equal though. I think this is a situation where any pullback that we get will end up being a buying opportunity as the federal reserve looks likely to remain somewhat tight while the Japanese central bank has no choice but to be loose, as the bond market in Japan is in trouble recently. That being said, the jobs number on Friday morning may cause a bit of a pullback.

I look at that as an opportunity to get long yet again. I’ve got no interest whatsoever in shorting. I do think that the 148 yen level, which is also the two hundred day EMA will offer a significant amount of support. Again, I won’t short this pair.

I believe that the us dollar is making a huge turnaround against most currencies, and the Japanese yen is especially vulnerable at this point in time. However, I also expect to see that the US dollar will more likely than not move in the same direction against almost everything.

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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 August 01, 2025

• The Euro rallied just a touch during the trading session on Thursday, as we continue to see a lot of noisy behavior.
• The market has recently seen a whole lot of downward pressure, especially now that the Federal Reserve seems to be more hawkish than anticipated, and therefore it’s likely that the US dollar will continue to be stronger overall.
• Contrast that with the Euro, which has seen a trade deal with the United States, which quite frankly, is not very good for Europe.

Breakdown?

Because of this, we have to ask the question as to whether or not we are about to see a breakdown. The market broke down below the 1.15 level, and the 50 Day EMA, both of which are very negative turns of event. The market being sub 1.15 is rather telling, and I think you’ve got a situation where people are going to be looking for some type of continuation. The jobs number on Friday could be the next catalyst, we don’t know, but quite frankly if the jobs number comes out hotter than anticipated, this will be yet another reason to think that the Federal Reserve will stay hawkish and stay away from cutting rates. On the other hand, the Europeans have to deal with quite a bit of energy dependence on the United States, and that’s something that we may have to watch from a longer-term standpoint.

On the other hand, if we were to break out to the upside, it’s not until we recapture the 50 Day EMA at the very least that I would consider buying. In that environment, we would probably see the US dollar drop significantly against most currencies, not just the Euro. Ultimately, this is a situation where it’s likely that the Euro would just be benefiting from US dollar weakness rather than any real strength at that point. Ultimately, I think this is a market that continues lower if the jobs number comes out significantly higher than the expected 106,000 jobs added in the United States.

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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.