Created on November 21, 2024

• The gains made yesterday by the GBP/USD currency pair to the resistance level of 1.2715 quickly evaporated.
• Concurrently, it returned to stabilizing around its six-month low, currently around the 1.2650 support level at the time of writing this analysis.
• This comes ahead of the announcement of a package of important US economic data and statements by some US Federal Reserve officials.
• Recently, weakening risk sentiment has deprived the pound sterling of its chance to rise.

Reasons for the Rise in the Pound Sterling

According to reliable trading platforms, the pound sterling has strengthened against other major currencies. This followed the announcement of economic data results, which showed that UK consumer price inflation rose to 2.3% year-on-year in October from 1.7% in September, a larger increase than the 2.2% expected by the market. At the same time, the UK monthly inflation rate rose to 0.6% in October, from being stable in the previous month. The crucial annual rate of services for the Consumer Price Index rose from 4.9% to 5.0%, signalling to the Bank of England that it should not rush to cut interest rates.

The reaction to the economic data results caused UK bond yields to rise, reflecting expectations that borrowing costs will remain higher for longer. Overall, the chances of a British interest rate cut next month have declined after the releases, in line with the rise in the pound sterling.

Weakening Risk Sentiment Negatively Impacts Sterling

As is known, the pound is a risk currency and tensions between Russia and Ukraine have recently escalated amid measures that threaten to widen the scope and length of the war. This is in addition to the continued strength of the US dollar, driven by expectations for the future of the US economy under Trump’s leadership.

Bank of England Policy Expectations

Widely, markets are expecting no change in the Bank of England policy decisions next week, and expectations have increased based on Governor Andrew Bailey’s testimony to the Treasury Select Committee this week. However, the BoE Governor is unsure how the £26 billion jobs tax announced in October will affect UK inflation. Recent economic data has also given the BoE Governor “reason to think”. Consequently, next month is too early for another rate cut.

Technical Analysis for the GBP/USD pair today:

According to the performance on the daily chart, the overall outlook for the GBP/USD currency pair remains bearish. However, dear follower of TradersUp, you should pay attention that the movement of the GBP/USD towards the support levels of 1.2600 and 1.2545 will push technical indicators towards strong oversold levels. From the last level, you can consider buying the GBP/USD. Furthermore, as we always recommend, do not take risks and activate take-profit and stop-loss orders to ensure the safety of your trading account from any sudden price reversals. Conversely, for the currency pair to exit the downward trend, the bulls must first move towards the resistance levels of 1.2775 and the psychological resistance of 1.3000, respectively.

Also, do not forget that the pound sterling was one of the best performing G10 currencies in 2024, due to the factors of economic growth surprises and the cautious approach to dealing with interest rates at the Bank of England.

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• Recent Bank of Japan remarks have shown a growing urgency to strengthen the weak yen.

• BoJ’s Ueda said the central bank would focus on incoming data before the December meeting.

• The dollar eased as market participants awaited new developments in the US.

The USD/JPY outlook indicates growing enthusiasm among yen bulls after recent hawkish remarks from BoJ policymakers. Meanwhile, the dollar eased from recent peaks as traders awaited new US politics and monetary policy developments. 

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Recent Bank of Japan remarks have shown a growing urgency to strengthen the weak yen. BoJ governor Kazuo Ueda noted that rising wage growth would drive inflation, allowing the central bank to continue hiking interest rates. On Thursday, he said the central bank would focus on incoming data before the December meeting to decide whether to hike interest rates.

Moreover, policymakers will focus on the impacts of a weak yen on Japan’s economy. These comments have boosted the yen as markets see a growing likelihood that interest rates in Japan will rise in December. 

Before the US election, a Reuters poll had shown that most economists expected the Bank of Japan to pause in December and hike in March next year. However, Trump’s win has shifted the outlook for US monetary policy. Markets expect fewer rate cuts by the Fed, which will keep the greenback strong. Consequently, further weakness for the yen is piling more pressure on Japan to hike interest rates.

Meanwhile, after a solid Trump rally, the dollar eased as market participants awaited new developments in the US. On the other hand, Fed policymakers have assumed a more hawkish tone, lowering rate cut expectations. Nevertheless, economists still believe the central bank will cut rates in December.

USD/JPY key events today

USD/JPY technical outlook: Lower high signals bearish resurgence

On the technical side, the USD/JPY price has broken well below the 30-SMA, showing control has shifted from bulls to bears. At the same time, the price has punctured the 154.51 support level. Meanwhile, the RSI has dipped into bearish territory below 50. 

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Initially, the price broke below its bullish trendline after a surge in bearish momentum. However, bulls managed to retake control. Unfortunately, they only made a lower high, indicating weaker momentum. Consequently, bears returned and are ready to break below 154.51. Such an outcome would allow USD/JPY to revisit the 151.74 support level.

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• EUR/GBP has returned to the range it has been trading in since the end of September. 
• It will probably continue oscillating there until it breaks out either higher or lower.
• The false downside break at the start of November, suggests the range floor may be vulnerable. 

EUR/GBP continues trading in a range. The pair is probably now in a sideways trend and given the principle of technical analysis that “the trend is your friend” it will probably continue oscillating until it makes a decisive breakout one way or another. 
 

EUR/GBP 4-hour Chart 

The pair made a false break on November 8 when it fell to a two-and-a-half year low of 0.8260. However, rather than continuing down to the target generated from the range, EUR/GBP recovered back inside where it now trades. 

Because it is in a sideways trend, however, the odds favor a continuation sideways, which suggests the possibility of a recovery from the current level near the range floor, and the unfolding of a leg up towards the ceiling at around 0.8450. 

It is too early to say with any confidence whether EUR/GBP will indeed rise up to the top of the range. Further, the false break may be a sign of weakness and be followed by another break lower, thus complicating the picture and adding a bearish tone to the chart. 

Assuming a break lower, it is possible the pair could fall to the target established by the range, at 0.8219 – the 61.8% Fibonacci extension.

Created on November 21, 2024

• During my daily analysis of the GBP/USD pair, the first thing I notice is that we did try to rally, but it seems like above the 1.27 level, the sellers came in and really started to push the markets again.
• All things being equal, this does make a certain amount of sense, because quite frankly the interest rates in the bond markets continue to climb in the United States, despite the fact that the Federal Reserve is trying to loosen monetary policy.
• Quite frankly, bond traders don’t care what the Federal Reserve wants.

Technical Analysis

The technical analysis is very negative, but we are approaching an area that is rather supported. The 1.25 level of course is a large, round, psychologically significant figure, and a lot of people will be paying close attention to whether or not we can find buyers in this region. Furthermore, there will be a lot of options being traded in that general vicinity, so therefore it offers a certain amount of support. This is an area that has been important multiple times so I think a lot of traders will be paying close attention to it. On the other hand, if we were to rally from here, the market could go looking to the 200 Day EMA near the 1.2850 level, which of course is an indicator that a lot of people pay close attention to. For what it is worth, the 50 Day EMA has fallen a bit again, and it looks like it is trying to do everything it can to cross below the 200 Day EMA, kicking off the so-called “death cross.”

All things being equal, this is a pair that is fairly negative, and I think may continue to be so. Quite frankly, I think any time this market rallies, you will be looking for signs of exhaustion that you can start selling again. I have no interest in buying this pair anytime soon.

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Created on November 21, 2024

• The Japanese yen’s gains continued to weaken on Tuesday as uncertainty surrounding the future of the Bank of Japan’s policy pushed the USD/JPY pair down to 153.28.
• However, it quickly reversed to an upward trend, with gains extending to the resistance level of 155.88.
• The USD/JPY pair is currently stabilizing around the 155.40 level at the time of writing this analysis, ahead of the announcement of important US data, led by the announcement of weekly jobless claims and statements by some US Federal Reserve officials.

BoJ Policies

In addition to the strength of the US dollar since Trump’s victory, investors are also reacting to expectations about the future of the Bank of Japan’s policies. Recently, uncertainty has persisted regarding future Japanese interest rate hikes. In this regard, the Governor of the Bank of Japan confirmed that any interest rate hikes would be gradual, depending on economic conditions, and at the same time did not indicate a timeline for when such increases in rates would occur.

Exchange Rate and Japanese Intervention

The continued rise of the US dollar against the Japanese yen has often prompted statements from Japanese officials about the harm of continued increases. Recently, the latest verbal warnings from Japanese authorities have been less effective in curbing market concerns, as traders are looking at the 160 level for the US dollar against the Japanese yen as a potential trigger for further government intervention in the forex market. In general, the Japanese yen remains under pressure from the US dollar, supported by expectations that Trump’s policies may reignite inflation and limit future interest rate cuts by the Federal Reserve.

Japanese stocks in decline

According to stock trading platforms, the Nikkei 225 Japanese stock index fell by 0.8% to around 38030, while the broader TOPIX index lost 0.2% to 2693 on Thursday, as Japanese stocks reached their lowest levels in several weeks, and Japanese stocks were negatively affected by losses in the technology sector. The decline came after a sharp drop in the US-based Nvidia stock after hours, despite the company announcing better-than-expected quarterly results and providing strong forward guidance. Overall, the suffering of Nvidia shares has greatly affected the broader technology sector.

USD/JPY Technical analysis and Expectations Today:

The overall trend of the USD/JPY pair remains upward. Bulls are in control as long as the currency pair is above the resistance of 155.00. The performance of the USD/JPY pair is currently focusing on the possibility of intervention from Japan. Talk of this will increase within the resistance ranges of 155.00 and 160.00, respectively. The upward movement amidst a strong rebound from the 21-day simple moving average. So far, Japanese intervention in the foreign exchange markets has been verbal. Therefore, you should be cautious as actual Japanese intervention in the market may bring about strong selling of the currency pair. Meanwhile, the first move will be from the support of 152.00 and below.

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• The euro collapsed on Wednesday after reports that Ukraine had hit Russia with missiles.

• Traders fear Trump’s looming tariffs on Eurozone goods.

• Economists expect the Fed to lower borrowing costs in December.

The EUR/USD forecast shows a fragile euro as investors worry about the escalating Ukraine war and Trump’s looming tariffs. Meanwhile, the greenback paused its rally as traders took profits after the Trump trade.

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The euro collapsed on Wednesday after reports that Ukraine had hit Russia with missiles. The conflict between Russia and Ukraine has escalated in recent days, with Putin threatening to use nuclear power. Consequently, there is an ever-increasing risk that the war will hurt the Eurozone economy. 

At the same time, traders fear Trump’s looming tariffs on Eurozone goods, which might weaken the economy. Trump has promised to impose taxes on European cars, reducing demand. This looming threat to Eurozone exports has clouded the outlook for the euro.

Elsewhere, the dollar paused its Trump rally as markets awaited new developments after the election. Currently, the president-elect is forming his cabinet, which has put a pause on policy speculations. The greenback has rallied to a one-year high against the euro amid optimism that Trump’s presidency will bring robust economic growth and higher inflation. As a result, markets have gradually lowered expectations for Fed rate cuts. 

A Reuters poll revealed that economists expect the Fed to lower borrowing costs in December. However, market participants have lowered bets to slightly below 60%. Meanwhile, the outlook for 2025 has also shifted, with experts forecasting fewer rate cuts. 

Traders will now watch economic reports to gauge whether the Fed will cut in December. At the same time, policymaker remarks might give more insight into future policy moves.

EUR/USD key events today

EUR/USD technical forecast: Downtrend resumes after brief pause

On the technical side, the EUR/USD price has dropped back below the 30-SMA after recently pausing its decline. The downtrend halted near the 1.0501 key level before bulls took charge and broke above the SMA. However, despite two attempts, they failed to go beyond the 1.0600 key level. 

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As a result, bears resurfaced and broke below the SMA. The price has now retested the SMA as resistance and is bouncing lower to challenge the 1.0501 support level. A break below this support will signal a continuation of the previous downtrend.

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• GBP/JPY may depreciate further as daily chart analysis suggests a bearish bias.
• The nine-day EMA sits below the 14-day EMA, signaling continued weakness in short-term price momentum.
• The immediate support appears at the lower boundary of the descending channel at 193.50 level.

The GBP/JPY cross pares its recent gains, trading around 195.80 during the early European hours on Thursday. The daily chart analysis indicates that the pair is positioned within the descending channel pattern, suggesting a bearish bias.

The 14-day Relative Strength Index (RSI) is slightly below the 50 level, confirming bearish momentum. Additionally, the nine-day Exponential Moving Average (EMA) is positioned below the 14-day EMA, indicating persistent weakness in short-term price momentum.

On the downside, the GBP/JPY cross may navigate the region around the lower boundary of the descending channel at the 193.50 level. A break below this level would reinforce the bearish bias and put downward pressure on the currency cross to revisit the two-month low at the 189.56 level, which was recorded on September 30.

Regarding the upside, the immediate barrier appears at the nine-day EMA at 196.46 level, followed by the 14-day EMA at 196.63 level. Further resistance appears at the upper boundary of the descending channel at 197.70 level. A successful breach above this channel could cause the emergence of the bullish bias and support the GBP/JPY cross to test the four-month high at 199.81 level, reached on October 30.

GBP/JPY: Daily Chart

GBP/USD is trading at $1.26435, down 0.06%, indicating a cautious bearish sentiment on the 4-hour chart. The pair remains below the pivot point at $1.26735, suggesting further downside risk.

Immediate support is seen at $1.26129, with additional levels at $1.25713 and $1.25309 offering a safety net. Resistance is positioned at $1.27154 and $1.27544, with a higher ceiling at $1.27934.

The 50-day EMA at $1.26718 is aligning with the pivot, reinforcing bearish momentum, while the 200-day EMA at $1.27991 highlights a stronger resistance zone above.

Growth Amid Financial Uncertainty

The Eurozone’s economic outlook remains precarious, as the ECB’s Financial Stability Review highlighted elevated vulnerabilities in financial markets and sovereign debt. German PPI met expectations at 0.2%, signaling stable producer prices, while the German 30-year bond auction showed slightly higher yields at 2.55%.

Upcoming Eurozone Consumer Confidence data (-13 forecast) is unlikely to shift sentiment. Elevated borrowing costs and weak fiscal fundamentals continue to weigh on corporate balance sheets, leaving the euro under pressure amidst geopolitical and policy uncertainty.

EUR/USD Technical Forecast

Created on November 20, 2024

• For four consecutive trading sessions, the EUR/USD currency pair has been attempting to rebound and recover from its lowest levels in a year, which reached the support level of 1.0496 at the end of last week.
• This is due to the strength of Trump’s trade policies, which provided further strength to the US dollar against other major currencies. The rebound gains for the EUR/USD pair did not exceed the level of 1.0609 before stabilizing around the level of 1.0588 at the time of writing this analysis, awaiting further stimulation to avoid further collapse.

Factors Weakening the Euro Price Performance

According to the Forex market trading, the euro’s losses came primarily in light of the impact of investor sentiment on concerns about the impact of US trade tariffs on Eurozone growth and geopolitical tensions. Investors have been buying safer assets, especially after Ukraine used Western-made missiles to strike Russia, and in return, Russian President Vladimir Putin expanded Russia’s nuclear doctrine to allow nuclear responses to major conventional attacks.

In addition, European Central Bank officials warned that new US tariffs could harm economic growth in the Eurozone, reducing inflation concerns. The European Central Bank has cut interest rates three times since last June, as inflation is approaching its target of 2%, but growth forecasts have been cut twice. In general, financial markets largely expect the ECB to cut interest rates by 25 basis points next month, with a smaller chance of a larger move.

European Stocks Continue to Suffer Losses

According to stock trading platforms, selling pressure continues on the performance of European stock market indices in yesterday’s trading, Tuesday. The Stoxx 50 fell 0.9% and the Stoxx 600 fell 0.4%, closing at its lowest in more than three months and posting its third straight session of losses.

Most sectors were lower, with banks down 1.4% and travel stocks down 1%. Meanwhile, healthcare stocks rose 0.6%. furthermore, Investors moved towards safe-haven assets after Russia announced expanded terms for nuclear retaliation. Earnings updates, however, offered mixed signals: Imperial Brands reported a better-than-expected 4.6% rise in annual profit, while Germany’s Thyssenkrupp pointed to challenges at its steel division with a €1 billion impairment. Caixabank shares fell 5% after unveiling a new strategy, and Nestlé shares fell 1.9% as it announced further cost-cutting measures.

What will affect the performance of the Euro Dollar today?

According to economic data, the EUR/USD price today will be affected by the announcement of the German producer price index reading and expected statements from European Central Bank Governor Lagarde to look for signals from bank officials about the future of the ongoing easing cycle considering European political and economic concerns and under a US administration led by Trump. Later today, the EUR/USD will also be affected by new statements from some US Federal Reserve policy makers.

EUR/USD Technical Analysis

According to recent trades, the EUR/USD currency pair has formed lower consecutive peaks with a downward trend line that has been steady since last October. Technically, the price is rising from its lowest levels around 1.0490 and may be about to test the resistance zone. At the same time, Fibonacci retracement levels on the latest swing high and low show that the 61.8% Fibonacci level is closest to the trendline around the 1.0775 level. Meanwhile, the 50% level coincides with the dynamic resistance of the 100 simple moving average at 1.0721. therefore, the minor correction may actually find sellers at the 38.2% Fibonacci at 1.0666.

Overall, if either of these levels hold as resistance, EUR/USD could make its way back to the swing low or lower. Also, the 100 SMA is below the 200 SMA to indicate that the stronger trend is down or that the downtrend is likely to resume rather than reverse. As per the technical indicators, the Stochastic is already in the overbought zone, so a downward shift suggests that selling pressure is ready to increase. The oscillator has plenty of room to slide before reaching the oversold zone, so the price could continue to follow the same trend. On the other hand, the RSI has room to rise before reaching overbought levels, so the correction could continue until that happens. However, a break above the trend line and the dynamic turning point of the 200 SMA could signal the beginning of a reversal.

EUR/USD Signals:

Dear reader, we advise you to monitor the movement of the Euro against the US Dollar EUR/USD price around and below the support level of 1.0500 to look for buying levels for the Euro Dollar, waiting for an opportunity to rebound upwards. Decisively, by considering not taking risks and activating profit limit and stop loss orders to ensure the safety of your trading account from any sudden price reversals. To get EUR/USD recommendations and other free direct trading signals through our website, register your presence with us.

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British Pound PRICE Today

The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the New Zealand Dollar.

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).