The EURJPY pair ended its rally above 166.40 level, to notice recording some extra gains by hitting 167.70 level, taking advantage of its main stability with the bullish channel’s levels besides stochastic attempt to provide extra positive momentum by its fluctuation near 80 level.

Therefore, we will keep our bullish scenario, which targets 168.20 level reaching to the resistance of the bullish channel at 169.45, to form the main target of the current period trading.

The expected trading range for today is between 166.75 and 168.20

Trend forecast: Bullish

June 20, 2025 – Written by Ben Hughes

STORY LINK Pound Rate Today: Short Covering Underpins GBP vs EUR, USD

The British Pound (GBP) dipped against the Euro (EUR) and US Dollar (USD) in immediate response to the Bank of England (BoE) interest rate decision, but found solid support on dips with an element of short covering after the currency failed to extend losses.

Global markets were subdued amid a US market holiday, but conditions were still very tense given speculation over a US military strike on Iran’s nuclear infrastructure.

The Pound to Euro (GBP/EUR) exchange rate dipped to 1.1685 before a recovery to 1.1710 and marginal gains on the day

According to ING; “We retain a short-term target in EUR/GBP at 0.860. (1.1630 for GBP/EUR). It added; “Geopolitical risks and a potential return of trade-induced market volatility in July argue that the balance of risks remains tilted to the upside for the pair despite the recent rally.”

The Pound to Dollar (GBP/USD) exchange rate hit lows near 1.3400 before a rebound to near 1.3450.

Scotiabank commented; “The multi-month trend is intact, for now, as GBPUSD tests the important medium-term 50 day MA (1.3390) support level. A break from here would call for a more decisive call in the trend shift. The latest pair of doji candles signals uncertainty, and we expect the near-term range to be defined by support below 1.3380 and resistance above 1.3480.”

The Monetary Policy Committee (MPC) held interest rates at 4.25%, in line with strong consensus forecasts with the chances of a cut seen at below 5%.

There was no updated Monetary Policy Report at this meeting and, therefore, no fresh macroeconomic forecasts.

There was a 6-3 vote split for the decision with Dhingra, Taylor and Ramsden dissenting and calling for a further 25 basis-point cut to 4.00% at this meeting.

According to Handelsbanken UK economist Daniel Mahoney; “The central bank’s decision was slightly more dovish than expected.”

He added; “I think most people in the markets thought there would be a 7-2 so I think that’s interesting, but I think those three members are obviously focusing on some of those domestic indicators.”

The key theme was uncertainty, especially given important trade and Middle East tensions.

The bank maintained its overall guidance; “Given the outlook, and continued disinflation, a gradual and careful approach to the further withdrawal of monetary policy restraint remained appropriate.”

It added; “The Committee would continue to monitor closely the risks of inflation persistence and what the evidence might reveal about the balance between aggregate supply and demand in the economy.”

It noted that wages growth has slowed and expects this process will continue, but it was still not willing to sound the “all clear” on wages or inflation.

In this context, it stated that further progress is needed to reach the 2% target.

The majority was confident that disinflation was continuing but commented that; “there was not a strong case for a further easing of monetary policy at this meeting.”

Governor Bailey commented; “The world is highly unpredictable. In the UK we are seeing signs of softening in the labour market. We will be looking carefully at the extent to which those signs feed through to consumer price inflation.”

There will also be concerns over any further increase in energy prices.

ING commented; “The hawks, meanwhile, will also have a beady eye on oil prices. Though the rise so far won’t make much difference to the inflation outlook we know some at the Bank are wary of a repeat of 2022, where a rise in energy prices turned into a much wider and more persistent services-driven inflation episode.

PwC chief economist Barret Kupelian also noted geopolitical uncertainty and the threat of a surge in oil prices.

He added; “If that rally embeds itself into wage setting or in household bills, the upside risk to inflation could well push any rate cut further down the calendar. In these murky waters, patience is the Bank’s best compass, steering a steady course between hawkish overreach and premature relief.”

Handelsbanken’s Mahoney considered that comments that the bank is not on a pre-set path was a “critical point.”

In this context, a major spike in oil prices could force the bank to consider a rate hike.

According to the minority, policy was too restrictive at the current time and a further cut was needed at this time to avoid inflation falling too far below 2%.

Markets are now pricing in an 80% chance that rates will be lowered to 4.00% at the August meeting.

Traders also expect that there will be at least one further cut before the end of 2025.

ING added; “our base case is that the BoE cuts rates in August and November, and twice more in 2026.”

Simon Dangoor, head of fixed income macro strategies at Goldman Sachs added; “We continue to expect the bank to resume rate cuts in August, followed by a shift to consecutive reductions starting in November, ultimately bringing the bank rate down to 3.25%.”

Berenberg is not expecting further cuts this year due to upward pressure on costs; “As companies pass those costs on, inflation is likely to prove too stubborn for the Bank to cut again this year.”

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TAGS: Pound Dollar Forecasts Pound Euro Forecasts

• Thursday was Juneteenth in the United States, which of course is a federal holiday.
• Because of this, most American traders were not involved in the markets, and it suggests that we have a scenario where traders are going to be somewhat shrugging their shoulders based on the lack of liquidity.
• However, the candlestick from the Wednesday session was of course very important as well.

Technical Analysis

The technical analysis for this market is still bullish overall, but the fact that we ended up forming a shooting star on Wednesday, breaking down below the bottom of the candlestick opens up the possibility of a move down to the 1.14 level. The 1.14 level being broken to the downside of course opens up the possibility of a move to the 1.13 level, where we currently see the 50 Day EMA residing.

On the upside, the 1.16 level is a major barrier, and therefore we will have to watch that very closely. If the market were to break above there, then the Euro would really start to take off to the upside. I think at this point in time though, we are more or less in a consolidation area, and we are trying to sort out where to go next. This is a pair that will be mainly driven by the overall attitude of the US dollar, which of course is considered to be a “safety currency”, and therefore the fact that we have so much going on in the Middle East in Ukraine at the moment, as well as all of the trade war rhetoric, makes it very likely that the US dollar will continue to be a big mover over the next foreseeable trading sessions.

When you look at the area that we are in right now, the 1.13 level being the floor in the 1.16 level being the ceiling, we are fairly close to the middle. Because of this, I feel that we are essentially “killing time” waiting for some type of clarity. I also am fully cognizant of the fact that it’s probably easier for this pair to rise and fall, but whether or not there is any real conviction is a completely different question.

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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.

• GBP/USD stays in a consolidation phase above 1.3400 on Thursday.
• The BoE is expected to maintain its bank rate at 4.25% after June meeting.
• The risk-averse market atmosphere could make it difficult for the pair to stage a rebound.

After closing the day virtually unchanged on Wednesday, GBP/USD edged lower and touched its weakest level in about a month near 1.3380 in the Asian session on Thursday. Although the pair managed to recover above 1.3400 by the European morning, it’s struggling to attract buyers ahead of the Bank of England’s (BoE) policy announcements.

The BoE is widely expected to maintain its bank rate at 4.25% following the 25 basis points (bps) cut announced in May. Because there will not be a press conference, the vote split and the language in the policy statement could drive Pound Sterling’s valuation in the near term.

In case the vote is unanimous for a policy hold, the immediate reaction could help Pound Sterling gather strength. On the flip side, GBP/USD could continue to stretch lower if more than two policymakers vote in favor of a rate cut.

Meanwhile, the US Dollar (USD) stays resilient against its peers on Thursday and limits GBP/USD’s upside. The Federal Reserve’s (Fed) cautious tone and the risk-averse market atmosphere support the USD.

The Fed left the policy rate unchanged at the range of 4.25%-4.5% after the June meeting, as expected, and the revised Summary of Economic Projections (SEP) showed that policymakers still see a 50 bps reduction in the policy rate in 2025. On a hawkish revision, the document highlighted that officials now forecast only a 25 bps cut in 2026, against the 50 bps projected in March’s SEP.

In the post-meeting press conference, Fed Chairman Jerome Powell noted that there is unusually elevated uncertainty in the outlook and said that they expect goods inflation to rise further this summer, with tariffs working their way to the consumer. Powell also reiterated that they are well-positioned to wait before deciding on the next policy step.

Meanwhile, markets grow anxious as tensions in the Middle East remain high, with the possibility of the United States (US) directly getting involved in the Iran-Israel conflict. Bloomberg reported early Thursday that US officials are preparing for a possible strike on Iran in coming days. Additionally, the Wall Street Journal claimed that US President Donald Trump has approved attack plans on Iran earlier this week but wanted to wait to see if Tehran would abandon its nuclear program.

GBP/USD Technical Analysis

GBP/USD remains below the lower limit of the ascending regression and channel and stays below the 200-period Simple Moving Average after closing the previous four 4-hour candles below that level, reflecting a bearish tilt in the near term.

On the downside, 1.3400 (Fibonacci 50% retracement of the latest uptrend) aligns as the immediate support level before 1.3340 (Fibonacci 61.8% retracement) and 1.3300 (static level, round level). Looking north, resistance levels could be spotted at 1.3440-1.3450 (200-period SMA, Fibonacci 38.2% retracement and 1.3520 (Fibonacci 23.6% retracement, 100-period SMA).

USD/JPY Technical Analysis

The US dollar has rallied a bit against the Japanese yen in that same time frame, initially pulling back below the 145 yen level, but now it looks like we’re going to make a serious attempt at threatening the 146 yen level. This is an area where I think if we can clear somewhat cleanly, we could have a nice breakout. It would make a certain amount of sense. The Japanese are having issues with their bond market, as far as not finding enough buyers. So, the Bank of Japan’s probably going now to be somewhat loose with its monetary policy going forward.

AUD/USD Technical Analysis

The Australian dollar fell against the US dollar as it is now threatening the bottom of the overall channel that we have been following for several months now. With that being the case, the 50 day EMA and the 200 day EMA come into the picture as potential support as well. But really at this point, the Australian dollar just doesn’t seem to be able to pick up momentum.

It has been grinding higher for a while now, but it just can’t get above that crucial 0.6550 level. And until that’s the case, it’s a short-term back and forth type of range-bound market more than anything else. If we break down below the moving averages, then we could see a drop to the 0.6350 level.

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

The GBPJPY pair faced new negative pressure by stochastic reach below 50 level, which forces it to attack the support of the minor bullish channel’s support and suffer some losses by hitting 194.00 level, facing 50% Fibonacci correction level.

We expect the price to be affected by the instability and providing mixed trading, to keep waiting for confirming the main trend, depending on the next close, so the repeated stability above 194.40 will reinforce the bullish scenario to assist to breach the barrier at 195.70 reaching the next target at 196.60, while the stability below 194.00 will confirm the dominance of the bearish bias domination in the near trading, to expect suffering big losses by reaching 192.85.

The expected trading range for today is between 194.00 and 195.10

Trend forecast: Neutral

The EURJPY pair continued forming bearish correctional trading, to keep gathering the gains of the last bullish attack, hitting the 166.00 level, which represents the extra support level for the current trading.

Stochastic exit from the overbought level might force the price to renew the pressure on the current support, where breaking it will confirm its readiness to resume the attempts of gathering the gains by reaching 165.45 and 165.00, while activating the bullish track requires forming a strong bullish rally to settle above 167.35 level, then targeting new positive stations that begin at 168.00 and 168.90.

The expected trading range for today is between 165.45 and 166.85

Trend forecast: Fluctuated within the bullish track

• The GBP/USD forecast is bearish amid a hawkish Fed.
• Geopolitical concerns continue to weigh on the pound.
• Markets are now awaiting BoE policy decision and statement.

The GBP/USD forecast has turned slightly bearish after staying subdued for the third consecutive session. The pair is trading around 1.3415, at the time of writing.

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The British pound is struggling as the US dollar demand rises due to safe-haven flows stemming from Iran-Israel conflict. On the other hand, FOMC meeting surprised the markets with a hawkish tilt. Now, the market participants await Bank of England policy meeting and statement, due later today.

On Wednesday, the GBP/USD pair found a mild support after the UK CPI print came better than expected. However, the inflation is still ticking down. That’s why the pound could not capitalize on the move. The last week’s dismal GDP and employment data continue to add pressure on the Bank of England to retain the easing policy.

On the geopolitics front, the Iran-Israel war has entered the seventh day. According to Bloomberg report, the US officials are preparing to attack Iran in the coming days. Another report from Wall Street Journal also claimed that the US President had approved attacks on Iran on Tuesday but he wanted to see if Iran would abandon its nuclear program.

Moreover, the Greenback found additional support from the Fed Chair Powell’s comments. He signaled that the inflation is still somehow above their targets and could rise again in near future due to Trump tariffs. Powell also supported currency policy program, leaving them well positioned. He reiterated that the Fed will hold rates and cuts will depend primarily on the inflation and labor data.

The FOMC kept the rates unchanged at 4.25% – 4.50%, as widely anticipated. The central bank still expects a 50 bps cut by the end of 2025.

GBP/USD Technical Forecast: Sellers Pause at 1.3400

The GBP/USD 4-hour chart shows a mild support around 1.3400. However, the previously broken support at 1.3418 now acts as a resistance. If the price holds around current resistance, it may fall towards the next support at 1.3340. The RSI is near the oversold area which indicates the pair may see some buying.

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However, the price staying below the 20-period SMA shows the bears are in control for now. The markets may consolidate around the current levels before finding any directional bias.

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The EURJPY pair recorded some extra gains by hitting 167.60 level, which forces it to form a temporary correctional rebound, affected by a stochastic attempt to exit the overbought level, providing chances for catching its breath and gathering the gains by reaching 166.70.

The price keeps providing mixed trading, but its repeated stability within the bullish channel’s levels and forming extra support at 166.00 level, so these factors make us keep the main bullish suggestion, which might target 168.00 level in the near period trading reaching the resistance level at 168.90.

The expected trading range for today is between 165.95 and 167.45

Trend forecast: Fluctuated within the bullish track

Is the US dollar gearing up for a significant reversal? There are early warning signs everywhere.

Watch today’s forex mid-week analysis to see how I’m trading the DXY, EURUSD, GBPUSD, and USDJPY this week!

US Dollar Index (DXY) Forecast

The US dollar could be on the verge of a significant turning point. For all of 2025, the DXY has trended lower steadily and aggressively. It’s been a relentless selloff that has wiped out several key levels.

However, no trend lasts forever, and a significant buy-side imbalance is evident near 106.00. Imbalances or inefficiencies like the one at 106.00 can often serve as magnets.

But without a technical trigger, imbalances like 106.00 don’t mean much. There also needs to be a trigger, such as a high-timeframe breakout, to confirm the reversal and open the door to those imbalances.

So far, USD bulls have cleared the 98.30 level. That was the first hurdle that I discussed in the last Weekly Forex Forecast. The next big test for buyers is the February trend line at 99.00.

That’s resistance for now, but a sustained break above would support the idea of a bullish reversal. It would also expose higher levels, such as 100.20 and 101.90.

Until then, the DXY remains range-bound and indecisive, oscillating between the 99.00 resistance level and the 98.30 support level.

EURUSD Forecast

The EURUSD uptrend could be in trouble as Tuesday’s session failed to hold above 1.1530. Additionally, the DXY broke above the 98.30 level I discussed in the Weekly Forex Forecast.

In that video, I shared how the DXY had been testing channel support from over a decade ago. I have also shared in recent weeks how the DXY 106.00 region could become a magnet.

The US dollar index left a significant imbalance at 106.00 during the March selloff. EURUSD shares a similar imbalance at 1.0600.

However, a couple of things need to occur to confirm these reversals.

First, EURUSD needs a sustained break below 1.1530 and 1.1440. That could confirm a significant top for the euro. So far, sellers have only dealt with 1.1530.

Second, the DXY needs to hold above 98.30, which is breaking today, and clear its February trend line at 99.00.

If that occurs, the EURUSD could target lower levels, such as 1.1275 and 1.1060. My final target on a confirmed top (if we get it) will be the 1.0600 region.

However, as mentioned above, the current price action serves as a warning sign. Both the EURUSD and DXY have work to do to confirm a full reversal pattern.

GBPUSD Forecast

GBPUSD is also flashing warning signs of a potential top. In previous videos, I discussed the similarities with the 2024 top, including a multi-month rising wedge and RSI bearish divergence.

The pound broke its rising wedge on Tuesday, closing the session right on the 1.3430 support area.

Where Wednesday’s session closes could determine if this key support area broke down on Tuesday. If the GBPUSD closes convincingly above 1.3430/40 on Wednesday, it will keep the area intact as support for now.

As with the DXY and EURUSD, the pound left a massive imbalance in the 1.2900 region during the April rally. That could serve as a magnet for GBPUSD if the breakdown is confirmed this week.

USDJPY Forecast

USDJPY remains range-bound between 145.40 resistance and 142.40 support. There has been no change to recent forecasts, but the potential remains.

One idea I have discussed in recent videos is a potentially weaker yen in the coming weeks. However, the Yen Basket remains above its 2020 descending trend line, so nothing is confirmed.

The same goes for USDJPY and other yen pairs. USDJPY is selling off from 145.40 yet again, so the pair remains range-bound until proven otherwise.

I’ll continue to monitor the Yen Basket as it tests its 2020 trend line. Recent price action suggests a possible buy-side fakeout, which could be bearish for the yen; however, I need to see more evidence before taking action.