• EUR/JPY trades at 165.16, up 0.06% early Tuesday, extending 4-day rally.
• RSI favors buyers, but lack of momentum points to wait-and-see mode.
• Break above 165.30 could expose Nov. 6 high at 166.09, then 167.00.
• Drop below 165.00 opens path to support at 164.03 and 163.60.

EUR/JPY prolongs its rally to four straight days as Tuesday’s Asian session begins. At the time of writing, the cross-pair exchange hands at 165.16, up 0.06%, and is up 0.09% in the week so far.

EUR/JPY Price Forecast: Technical outlook

The EUR/JPY is neutral to upward biased, but so far, it has remained trapped within the 164.50-165.30 range for the last three days, indicating a lack of conviction among buyers and sellers regarding the cross-pair. Momentum-wise, the Relative Strength Index (RSI) suggests that buyers are in control but are taking a respite, awaiting a fresh catalyst.

If EUR/JPY clears the year-to-date high, this would pave the way for a test of the November 6 high at 166.09. Once surpassed, the next stop would be 167.00. On the other hand, if EUR/JPY tumbles beneath the 165.00 mark, look for a test of the Tenkan-sen at 164.03, followed by the Senkou Span A at 163.60.

EUR/JPY Price Chart – Daily

USD/JPY Technical Analysis

The US dollar has fallen a bit against the Japanese yen during the early hours here on Monday as well. And this makes a bit of sense. The 145 yen level has been resistant multiple times. And of course, we’ve had the 50-day EMA sitting right here offering resistance as well. So, with this, we’re basically at the top of the short-term range.

If we can break out above the 50 day EMA, then we will challenge the 146 level. And then after that, we could really start to break out towards the 200 day EMA. In the meantime, though, I think we’re just still building a base and it’s going to take some time, and we may go sideways for a little bit.

AUD/USD Technical Analysis

The Australian dollar has rallied again during the early hours on Monday as it continues to pressure the resistance just above, but it just seemingly can’t quite get above it. This is an area that I’ll be watching very closely in the form of 0.6550. And I think this could be a fairly important level. But as you can see, we’ve attempted multiple times now and we are starting to pull back again as we got there. So, I’ll be watching this.

Certainly, this pair looks to be tilting higher, but we just haven’t had enough pressure to make it truly break out to the upside. So, I think this is a pair that is probably more or less a scalping pair or one that you’ll just be watching for a while until it makes a definitive move.

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

• The US dollar rallied rather significantly during the trading session on Friday as we continue to see a lot of noisy behavior.
• With this being the case, the market is likely to continue to see a lot of opportunity, but you will have to be very quick to take advantage of it.
• After all, this is a very noisy pair most of the time, and when we just had a Non-Farm Payroll announcement that surprised the market, and therefore it’s not a huge surprise to see the US dollar take out the Japanese yen as the market is likely to continue to pay close attention to the bond markets.

With Bond yields rising in America, it makes the US dollar much more attractive, and then you also have to pay close attention to the fact that the Japanese bond market is an absolute disaster. We’ve had a couple of days recently that the Bank of Japan was unable to find buyers of government debt, and if that’s the case, the Bank of Japan will more likely than not have to step in and start buying bonds, which is essentially the same thing as quantitative easing.

Technical Analysis

The technical analysis for this market is obviously somewhat noisy, as we are going sideways in general, but we are testing the crucial 50 Day EMA. The 50 Day EMA is of course an indicator that a lot of people will pay close attention to as it is a major trend defining indicator most of the time. This is a market that I think given enough time will probably break out to the upside I have been suggesting that for a while, and the Friday candlestick might be the beginning of chewing through the massive resistance. This of course opens up the possibility of a move to much higher levels, and if we do have that happen, I would anticipate that the ¥148 level would be the target. On the downside, as long as we can stay above the ¥142 level, I think you have a real shot at continuing to consolidate overall with more of an upward bias.

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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.

EUR/USD Analysis Summary Today

• Overall Trend: Bullish.
• Today’s Euro-Dollar Support Levels: 1.1380 – 1.1300 – 1.1220.
• Today’s Euro-Dollar Resistance Levels: 1.1460 – 1.1520 – 1.1600.

EUR/USD Trading Signals:

• Buy Euro-Dollar from the 1.1340 support level with a target of 1.1420 and a stop-loss of 1.1300.
• Sell Euro-Dollar from the 1.1460 resistance level with a target of 1.1200 and a stop-loss of 1.1510.

EUR/USD Technical Analysis Today:

This week, forex market trading will primarily focus on the results of trade talks between the United States and China. Meanwhile, the EUR/USD is still in an upward trend, and technically, the 200-hour moving average, currently observed at the 1.1377 support level, is helping to limit declines. According to performance across trusted brokerage platforms, the US Dollar Index (DXY), which measures the US currency’s performance against a basket of other major currencies, has fallen as investors prepare for a busy week of key economic data and trade developments.

Overall, sentiment has been affected by renewed hopes for progress in US-China trade relations. US President Donald Trump announced that officials from both countries will meet in London later today, following a recent phone call with Chinese President Xi Jinping.

Trading Tips:

We still recommend selling the EUR/USD pair on any upward bounce, while constantly monitoring market factors and avoiding risk, regardless of the strength of the trading opportunities.

Regarding economic data, markets are awaiting several key releases according to the economic calendar. The Consumer Price Index (CPI) is scheduled for Wednesday at 3:30 PM EEST, followed by the Producer Price Index (PPI) and the US University of Michigan Consumer Confidence report on Friday. These figures could offer new insights into how tariffs are impacting inflation and broader economic conditions.

According to forex market trading, the US dollar rose last Friday after the US jobs report for May showed slightly stronger-than-expected employment growth, although private sector employment, jobless claims, and services data pointed to some weakness in the economy.

Technical levels for the EUR/USD pair:

Based on the daily timeframe chart, the overall trend for the EUR/USD currency pair is upward. As we mentioned before, the 1.1400 resistance will continue to motivate the bulls for further advances. Recent gains have moved the 14-day Relative Strength Index (RSI) away from the midline, and the indicator still has more time and potential for gains before reaching overbought territory. At the same time, the MACD indicator lines are strongly trending upwards. Bulls’ attention is now on the psychological 1.1500 resistance. Decisively, Euro-dollar trading will remain within its current range until markets and investors react to the US-China trade talks and this week’s important US economic data releases.

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The GBPJPY pair succeeded in taking advantage of the main indicator’s positiveness, forming a strong bullish rally, achieving the previously suggested targets by reaching 196.18, forming a temporary negative rebound, in order to catch its breath before forming a new bullish attack.

The bullish track will remain valid, depending on the stability of the support near 194.20, besides the continuation of providing positive momentum by the main indicators, to expect surpassing 196.30 and reaching the next target at 197.35, to face 61.8%Fibonacci correction level.

The expected trading range for today is between 195.25 and 197.35

Trend forecast: Bullish

• The British pound did fall during the day on Friday as we continue to see a lot of noisy behavior.
• That being said, the market is likely to continue to look at the 1.3650 level above as a major barrier.
• If we can break above there, then I think we have a lot of buyers coming back into the picture and pushing the British pound to the 1.40 level.

That being said, the market is likely to see a lot of noise in this area. And I do think we continue to consolidate between 1.34 at the bottom and 1.3650 on the top. So, with that being the case, I think you’ve got a scenario where we just go back and forth, but I’ll be watching the 1.34 level for a potential breakdown. If we break down below there, then we could go look into the 50-day EMA.

On a move to the upside, breaking above that 1.3650 level, again, I think you see the British pound going looking to the 1.40 level. In that environment, I would anticipate that the US dollar is selling off everywhere.

US Dollar Strength

However, it’s probably worth noting that the US dollar strengthen against everything due to better than anticipated jobs numbers coming out of America. So, it’s very possible that we are getting close to seeing the end of US dollar selling, especially with the massive amount of increase in rates that I have seen over the last couple of weeks.

At this point in time, I anticipate that we see a lot of sideways action, but overall, I think there is still a lot of overhang when it comes to this market, as we had gotten a little bit ahead of ourselves. Ultimately, this is a pair that I’ll be watching very closely, because it could give us a bit of a “heads up” as to how the US dollar will behave overall.

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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.

Is the US dollar carving a higher low for the first time in 2025?

Get all of the details on the DXY, EURUSD, GBPUSD, USDJPY, and the Yen Basket of Currencies in today’s forecast. The GBPUSD analysis is a must-see.

US Dollar Index (DXY) Forecast

The DXY closed last week just above the 98.90 level, keeping bulls in the game for now.

However, the downtrend in 2025 remains intact. The DXY remains below its February descending trend line and the 100.20 handle.

So, although we could see the US dollar bottom here, bulls have work to do. Specifically, the DXY will have to break its February trend line and close a daily candle above 100.20.

Until then, there’s no change to the USD downtrend.

EURUSD Forecast

EURUSD has trended higher all year. However, the pace of the uptrend has slowed in recent weeks, leading to relatively choppy price action since May 12th.

Although the uptrend remains intact, the euro’s future direction is at a crossroads.

On the one hand, buyers remain in control, with the pair carving higher highs and lows. However, on the other hand, the recent repeated tests of the March trend line warrant caution.

If the EURUSD breaks its March trend line near 1.1340 next week, it will open up downside targets. But if the uptrend continues, a test of 1.1530 could be next.

I’m in no rush to trade the choppy price action, so I’ll wait to see what next week brings.

GBPUSD Forecast

GBPUSD remains in its 2025 uptrend, carving higher highs and lows. However, the price action over the last few months bears an eerie resemblance to the 2024 high.

With that said, there is no confirmation of a top just yet. As long as GBPUSD is above 1.3500 and 1.3430, the pair is trending higher.

If the pound falls below those levels on the high time frames, it could mark a significant top for GBPUSD. That would expose levels like 1.3200 and the 1.3050 imbalance.

On the other hand, a sustained break above 1.3630 would open up higher levels. But I would be skeptical of that, given the structure that has developed since April.

Another factor affecting the pound and the euro is the DXY. The dollar index will need to break its February trend line and 100.20 to signal a correction from the EURUSD and GBPUSD.

USDJPY Forecast

USDJPY is on my radar, but only if the yen basket of currencies (below) breaks below a key level. I discuss this more below, but for USDJPY, key resistance remains at 145.40, followed by 148.70.

The potential for the recent 142.00 low to become a higher low is present. However, we don’t have confirmation of that yet.

Other rules also apply when trading USDJPY. The yen basket chart needs to drop below a key level, and the DXY needs to break out for me to consider a long position in USDJPY.

For now, I’ll keep a close watch on USDJPY. However, other charts need to set up for me to consider trading the pair.

Japanese Yen Basket (JPYBASKET)

The Yen Basket of Currencies, or JPY Basket for short, is an appealing chart. It’s also a chart that’s overlooked by most traders, given how USDJPY is usually the center of attention.

However, the descending trend line on the weekly time frame from 2020 is incredibly well-defined. The index may also be approaching a weekly close below the level after breaking out earlier this year.

If it is confirmed, we could have a buy-side fakeout for the yen. That could introduce significant weakness for the JPY across the forex market.

The Yen Basket has already broken its 2024 ascending trend line, suggesting a weaker yen ahead. However, for the yen to weaken further, the JPY Basket needs to fall below its 2020 trend line, currently near 6,650, on a weekly closing basis.

• The GBP/USD weekly forecast indicates trade optimism in the UK.

• A better-than-expected nonfarm payrolls report allowed the dollar to recover on Friday.

• Next week, the US will release crucial inflation figures.

The GBP/USD weekly forecast indicates trade optimism in the UK after exemptions from Trump’s steel and aluminum tariffs.

Ups and downs of GBP/USD

The GBP/USD pair had a bullish week as the pound gained on trade optimism and a weak dollar. However, the dollar recovered on Friday after upbeat employment figures.

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The UK has already signed a trade deal with the US. Therefore, when Trump doubled tariffs on steel and aluminum, Britain was exempted. At the same time, the dollar fell at the start of the week due to downbeat data on business activity and private employment. This allowed the pound to gain. However, a better-than-expected nonfarm payrolls report allowed the dollar to recover on Friday.

Next week’s key events for GBP/USD

Next week, market participants will focus on key economic reports from the UK, including employment, manufacturing production, and GDP. Meanwhile, the US will release consumer and wholesale inflation figures. 

UK employment and GDP numbers will show the state of the economy, shaping the outlook for BoE policy. At the moment, market participants expect the central bank to pause at its next meeting. Still, the outlook for future moves will continue to change with incoming data.

Meanwhile, US inflation numbers will show whether Trump’s tariffs have increased price pressures. If not, policymakers will be confident to cut rates in September.

GBP/USD weekly technical forecast: Bearish RSI divergence

On the technical side, the GBP/USD price has made new peaks near the 1.3603 key level. Moreover, it trades above the 30-SMA, with the RSI above 50, indicating a solid bullish bias. However, while the price has reached a new high in the uptrend, the RSI has made a lower high, indicating a bearish divergence. 

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This is a sign that bullish momentum is fading. Therefore, bears might get stronger and push the price below the 22-SMA. Such a move would allow GBP/USD to retest the 1.3201 support level. However, bulls will remain in the lead as long as the price stays above the support trendline. 

On the other hand, if bulls regain momentum, the price will likely retest the 1.3603 resistance level. A break above would strengthen the bullish bias by making a higher high.

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The GBPJPY pair renewed the bullish attempts by its rally above 194.55 level, attempting to confirm the suggested bullish scenario, achieving some gains by hitting 195.30 level.

Note that the beginning of providing positive momentum will reinforce the chances for forming strong bullish waves, to expect attacking 195.70 level, and surpassing it will make it target new bullish stations, by reaching 61.8%Fibonacci correction level at 197.35, while the decline below 194.00 will force it to delay the rise and provide mixed trading again.

The expected trading range for today is between 194.45 and 195.70

Trend forecast: Bullish

June 6, 2025 – Written by David Woodsmith

STORY LINK Pound to Dollar Forecast: GBP Sterling Slides on US Jobs USD Relief

Dollar Secures Limited Corrective Relief after Jobs Data, GBP/USD Held Below 39-Month Highs

The dollar managed to secure tentative gains on Friday following the latest US jobs release. The data certainly had important weaknesses, but markets were braced for an even weaker report and the figures triggered an element of short covering.

Markets were also monitoring the Trump-Musk row given the potential impact on the Budget Bill in the Senate.

After failing to make a fresh attack on 1.3600 earlier in the day, the Pound to Dollar (GBP/USD) exchange rate dipped to lows at 1.3520.

According to Scotiabank the outlook is still bullish; “the September/April highs around 1.34 are likely to provide meaningful support from here. An extension of gains above 1.36 should find limited resistance ahead of the early 2022 high around 1.3750.”

ING noted market positioning; “With a market seemingly positioned for a soft number today, we think it will take a figure substantially under +100k and a rise in the unemployment rate (currently a low 4.2%) to trigger another leg lower in the dollar.”

The US employment report registered an increase in non-farm payrolls of 139,000 for May, above consensus forecasts of around 125,000, although the April increase was revised down to 147,000 from the original estimate of 177,000.

There were monthly job losses in manufacturing, retail and professional services while there was also a marginal decline in government jobs.

The unemployment rate held at 4.2% which was in line with expectations.

There was, however, a substantial decline in the labour force of 625,000 and the number of people reported as being employed plunged close to 700,000 on the month.

According to Annex Wealth Management Chief Economist Brian Jacobsen; “On its face, this shows an economy that’s holding up under the weight of a trade war, but the details show plenty of cracks forming.”

Ray Attrill, head of FX research at National Australia Bank commented; “Within all the noise the softness that we’ve seen in the data this week has probably been more responsible for rejuvenating the bearish U.S. dollar narrative than anything else that’s gone on.”

He added; “We’ve always taken the view that once it becomes clear that the U.S. economy is no longer exceptional, and that the policy actions that we’ve seen to date, together with the relative tightness of Fed policy, will start to show through particularly in a weakening labour market.”

Thursday’s data recorded a huge decline the monthly goods trade deficit to $61.6bn for April from a record $138.3bn the previous month as imports plunged.

Wells Fargo commented; “The temporary surge in imports as businesses pulled-forward demand to get ahead of tariffs has run its course. The U.S. international trade deficit narrowed sharply in April as a result and suggests a big boost to Q2 growth from net exports.”

Scotiabank commented; “With broader market sentiment still quite fragile, a new front of worry has opened up between President Trump and Elon Musk. Yesterday’s social media fisticuffs are one thing but Musk could muster support against the president’s tax bill, adding to broader market uncertainty.”

It added; “The overall downtrend remains intact and the USD has a lot of work to do in order to display any real strength. It does, however, see scope for a short-term bottom for the dollar index.

There were no major UK developments on Friday with traders looking ahead to next week. Scotiabank commented; “The near-term domestic release calendar offers some risk as we look to next week’s employment, industrial production, and trade figures.”

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