Created on December 30, 2024

• Recent attempts by the GBP/USD currency pair to rebound have not moved far from the vicinity of the 1.2500 support level, which we have often noted as the most important for maintaining bearish dominance over the GBP/USD trend.
• Technically, breaking this support would drive the pair towards its seven-month low.
• According to the forex market, the GBP has declined by 1.5% in 2024 so far, after maintaining its position against the US dollar for most of 2024.

GBP/USD Forecast for 2025

In this regard, Scotiabank expects a strong US economy and high yields to push the US dollar to its highest levels in two years as the EUR/USD slides to parity. In this environment, the GBP/USD is expected to decline to 1.22 support by the end of 2025. Scotiabank also expects the Trump administration to enact tax cuts and regulatory rollbacks that will support the US economy. The bank also sees the potential for another positive wealth effect from the strength of US equities, which would also help support consumer spending and investment.

In this context, the bank has revised its 2025 GDP growth forecast to 2.1% from 1.8%. With concerns about inflation, it also expects a significant impact on the US Federal Reserve’s policy. It now expects the Fed to be able to cut US interest rates only twice in 2025 to 4.00%, which will keep rates higher than the Eurozone. Moreover, Scotiabank expects the strength of equities and high yields to continue to support the US dollar over the year. However, it expects a reversal in 2026 as the US economy slows, with the GBP/USD pair recovering to 1.30 by the end of 2026.

Trading Tips:

The GBP/USD pair may remain in a narrow move with a downward bias until the markets’ vision of the future of Trump’s policies becomes clear

Bank of England policies affect the pound

One of the factors that pressured the performance of the GBP was the Bank of England’s slow pace of interest rate cuts during 2024, which reduced borrowing costs by only half a percentage point. This has supported much of the strength of the GBP. However, changing expectations for further cuts in UK interest rates in the future have put pressure on the GBP in recent weeks. In general, the markets expect interest rate cuts of 51.5 basis points in 2025 by the Bank of England, compared to 46 basis points in the cuts that were priced in before the latest monetary policy meeting of the year, when it kept interest rates unchanged but was more divided on the decision than markets expected.

Technical Analysis for the GBP/USD pair today:

According to the performance on the daily chart above, the overall trend of the GBP/USD remains downward. Meanwhile, the 1.2500 support level still solidifies the bears’ dominance and thus the readiness for a stronger downward move that could take the pair towards the following more important support levels of 1.2445, 1.2380, and 1.2300. technically, that in turn could move technical indicators towards oversold levels, led by the Relative Strength Index and the Stochastic oscillator. Furthermore, we still prefer selling the GBP/USD from every upward level without taking risks and activating take-profit and stop-loss levels to ensure the safety of the investment account from any sudden price reversals.

Ready to trade our daily GBP/USD Forex analysis? We’ve made this UK forex brokers list for you to check out. 

Created on December 30, 2024

• For eight consecutive trading sessions, the USD/JPY pair has been steadily rising, approaching the resistance level of 158.00, the highest level for the currency pair in five months.
• This stability has formed a bullish flag on the daily chart, confirming the bulls’ control over the direction of the USD/JPY pair.
• Also, bringing it closer to the next psychological resistance target of 160.00, which would increase talk of imminent Japanese intervention in the currency markets.

The Japanese Yen continues to be affected by the course of the Bank of Japan’s policy

The selling pressures on the Japanese yen against the rest of the other major currencies, led by the US dollar, continue as investors continue to assess the expectations of interest rates at the Bank of Japan. The summary of the Bank of Japan’s meeting in the last meeting of 2024 revealed that policymakers discussed the possibility of raising interest rates in the near term, as some bank officials suggested that the conditions were favourable for such a move. For its part, the Bank of Japan kept interest rates unchanged at 0.25%, with Governor Kazuo Ueda indicating the need to evaluate more data on wage growth next year and to gain more clarity on the economic policies of the incoming US administration. In general, investors are closely watching any potential intervention by the Japanese, especially after the Japanese Finance Minister reiterated concerns about the decline in the Japanese yen and repeated his warning against taking action against excessive movements in the currency.

At the same time, the performance of the Japanese yen faced additional pressure from rising US Treasury yields, despite recent US interest rate cuts.

Trading Tips:

The dollar/Japanese yen price will remain in an upward trend until the vision of Trump’s policies becomes clear and until there is Japanese intervention in the currency markets to stop the collapse of the yen against other currencies

Asian stock indices decline

According to today’s trading through stock trading company platforms, we have noticed a decline in Asian stock market indices today, Monday, as was the performance of US stock indices. Selling came amid uncertainty ahead of the end of 2024 and the inauguration of Trump as US President. According to trading, the MSCI Asia Pacific Index halted its five-day gain as shares in Australian and Japanese markets fell, while Chinese shares rose. At the same time, US 10-year Treasury yields remained near their highest levels since May after rising last week, which could affect the performance of stock prices. Due to the holidays, trading remains limited and within narrow ranges.

Also, it was noticeable that trading volumes for Japanese stocks were about 17% below their 30-day average, and Monday is the last trading session for Japanese financial markets this year, with public holidays from Tuesday to January 6. Overall, while Asian stocks are at their lowest levels today, they are still heading towards a strong annual performance. The MSCI Asia Pacific Index advanced 7.5% in 2024 as global central banks eased monetary policy and technology stocks rose amid optimism about artificial intelligence.

USD/JPY Technical Analysis and Expectations Today:

The USD/JPY currency pair continues to trade at levels slightly above the 100-hour moving average, and despite the decline. The USD/JPY pair remains centrally anchored in the 14-hour Relative Strength Index, leaving enough room for both bulls and bears to move. In the near term, bears will seek to extend the current decline towards 156.89 or lower to the support at 155.98. On the other hand, bulls will seek to take advantage of rebounds at around 158.51 or higher at the resistance 159.32.

In the long term, based on the performance on the daily chart, the USD/JPY pair is trading within an ascending channel formation. Also, the 14-day RSI supports a long-term bullish bias as it approaches overbought levels. Therefore, bulls will seek to continue the current winning streak to around 161.73 or above the resistance of 166.50. On the other hand, bears will seek to take advantage of the selling operations to book profits at around 153.31 or below the resistance of 148.86.

Want to trade our USD/JPY forex analysis and predictions? Here’s a list of forex brokers in Japan to check out. 

Created on December 30, 2024

• The US dollar pulled back just a bit during the early hours on Friday, as it looks like the 158 yen level continues to be a major barrier.
• This is an area where we’ve seen a lot of action in the past, so it does make a certain amount of sense that we would continue to look at this through the prism of a market that’s trying to bust through a major barrier.

I think it’s going to take some work, and I also think it is difficult to assume that the market is just going to be able to slice through there. Longer term, I do believe that the interest rate differential in the United States, in comparison to Japan will be a major factor. And we will eventually break out to the upside, but we may have to pull back a couple of times in order to build up pressure in a market that is a little extended. And of course, we also have the specter of illiquidity at the moment due to the fact that we are between two major holidays.

In Conclusion

So, in short, the way I look at this USD/JPY chart is I am trying to find a buying opportunity on pullbacks that show signs of a bounce. I would be very patient at this point in time, there’s no need to rush this because once traders come back after New Year’s Day, it is likely to be very volatile and very noisy. Therefore, you have to keep in mind that you’ve got a situation where traders will probably have to deal with a lot of back and forth chops.

The 155 yen level at the moment for me at least is going to be the floor in the market. If we were to break down below there, then we may have to rethink some things. But as things stand right now, I just think you don’t have enough volume in the market to finally break out above the 158 yen level, at least not right now.

Want to trade our USD/JPY forex analysis and predictions? Here’s a list of forex brokers in Japan to check out. 

• EUR/USD continues to trade in a narrow channel above 1.0400.
• The near-term technical outlook fails to offer a directional clue.
• Cautious comments from ECB officials help the Euro stay resilient against its rivals.

After ending the holiday-shortened week virtually unchanged, EUR/USD extends its sideways grind slightly above 1.0400 in the European session on Monday. The pair is likely to remain stuck in a tight range, with trading conditions unlikely to normalize until after the New Year holiday.

In an interview with Austrian newspaper Kurier over the weekend, European Central Bank (ECB) Governing Council member Robert Holzmann said that it might take more time until the ECB cuts rates again. “There are signs of an upward trend in some energy prices. But there are also other scenarios as to how inflation could return, like via a stronger devaluation of the euro,” Holzmann elaborated.

These comments seem to be helping the Euro hold its ground. In the second half of the day, Pending Home Sales for November and Chicago Purchasing Managers Index for December will be featured in the US economic calendar. These data, however, are unlikely to influence the US Dollar’s (USD) valuation in a noticeable way.

In the meantime, US stock index futures trade in negative territory, reflecting a cautious market mood. In case Wall Street’s main indexes turn south after the opening bell, EUR/USD could have a hard time keeping its footing.

EUR/USD Technical Analysis

The Relative Strength Index (RSI) indicator on the 4-hour chart holds slightly above 50 and EUR/USD stays above the 20 and the 50-period Simple Moving Averages (SMA), reflecting a lack of seller interest.

EUR/USD could face first resistance at 1.0440 (static level) before 1.0470 (100-period SMA) and 1.0500 (200-period SMA). On the downside, 1.0400 (round level, static level) could be seen as interim support ahead of 1.0350 (static level) and 1.0300 (static level, round level).

Created on December 29, 2024

The GBP/USD finished the week near the 1.25700 level, as the lower range of the currency pair continues to see plenty of tests and nervous sentiment appears to be creating headwinds.

Holiday trading in Forex created rather tight ranges for most major currencies last week and the GBP/USD was no exception. The lower elements of the GBP/USD remain the status quo as USD centric strength continue to be exhibited. Financial institutions were open for business before going into the weekend, but volumes were lackluster and trading in Forex this coming week will be relatively quiet too.

The GBP/USD is near important support ratios that are definitely being watched by large financial institutions. The 1.25000 ratio remains an important psychological level which came within sight early and late last week, this until a slight buying surge returned the GBP/USD to a more comfortable looking value and within talking distance of the 1.26000 level. However, the currency pair is certainly facing tests and these will not disappear this coming week.

Speculative Near-Term Considerations for the GBP/USD

Traders who believe the GBP/USD is oversold should be careful. The GBP/USD suffered when the Bank of England was overly cautious on the 19th of December and kept their interest rate in place. The BoE is practicing extreme caution even as the U.K economy is lackluster. The economic picture for the U.K is unlikely to see a vast amount of improvement in the mid-term. Yes, the Bank of England is nervous about inflation, but better fiscal policy would help the inflation fight.

The testing of the 1.25000 level as behavioral sentiment in financial institutions is nervous about Bank of England policy and also fragile because of USD centric strength make for a volatile mid-term to come. President-Trump’s takeover of the U.S White House has been digested, and now attention has turned to U.S Fed policy which is becoming more cautious. If U.S interest rates are not lowered over the mid-term, and the BoE must consider an interest rate cut this sets the stage for more potential weakness in the GBP/USD via financial institutional outlook. Light holiday trading this week will not seek to bet against these mid-term notions. A lack of clarity is not helping.

A New Lower Range for the GBP/USD Mid-Term

After having attained values in September above the 1.34000 level, the GBP/USD looks oversold. However, conditions have changed regarding outlook for the currency pair and they are not about to alter dramatically. Speculators who have bias towards the GBP/USD should make sure they are not betting on notions that have no foundation.

• Looking for a sustained move higher with solid price velocity in the near-term is not likely going to see good result.
• Instead traders of the GPB/USD this coming week should be prepared to see the 1.25100 to 1.25900 range get plenty of price action.
• Volumes may be solid tomorrow, but by early Tuesday Forex will again become very quiet and this will remain the case into Thursday.
• Friday of this week could see some more action as financial institutions position for the opening of the following week when volumes are certain to increase.

GBP/USD Weekly Outlook:

Speculative price range for GBP/USD is 1.25030 to 1.26070

The GBP/USD may appear to be in oversold territory to some speculators, but the price action of the currency pair matches the dynamics of the broad Forex market. Until sentiment begins to stabilize there will be no sudden shifts of momentum upwards for the GBP/USD that are sustained. The lower realms of the GBP/USD getting tested consistently the past week may see another round of these depths emerge.

Support did seem to be fairly strong around the 1..25100 mark with some outliers lower and perhaps this will continue to be the case in the coming days. Traders who want to participate in the GBP/USD like all of Forex this week should not be overly ambitious and be on the lookout for sudden bursts if large trades are transacted in inactive markets. Retail traders are reminded to use entry price points in Forex this coming week because spreads will widen in quiet conditions.

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.

• EUR/USD trades in a tight channel at around 1.0400 on Friday.
• The cautious market mood is likely to cap the pair’s upside.
• The near-term technical outlook points to a lack of directional momentum.

EUR/USD registered marginal gains after returning from the Christmas break on Thursday but failed to gather bullish momentum. Early Friday, the pair trades in a narrow channel at around 1.0400.

The data published by the US Census Bureau showed on Thursday that Initial Jobless Claims edged lower to 219,000 in the week ending December 21 from 220,000 in the previous week. This reading came in better than the market expectation of 224,000 but failed to influence the US Dollar’s (USD) valuation. In the second half of the day, the mixed action seen in Wall Street’s main indexes limited the pair’s upside.

The economic calendar will not offer any high-tier data releases on Friday. Meanwhile, US stock index futures trade in negative territory, reflecting a cautious market stance in the European session. Unless there is a noticeable improvement in risk mood in the American session, the pair could stay on the back foot.

Nevertheless, trading conditions are likely to remain thin, not allowing EUR/USD to make a decisive move in either direction.

EUR/USD Technical Analysis

The Relative Strength Index (RSI) indicator on the 4-hour chart stays near 50, highlighting EUR/USD’s indecisiveness. 

First resistance for EUR/USD could be spotted at 1.0430-1.0440 (50-period Simple Moving Average (SMA), static level) before 1.0475, (100-period SMA) and 1.0500 (200-period SMA). On the downside, 1.0350 (static level) and 1.0300 (static level, round level) could be seen as next support levels if the pair flips 1.0400 (static level, round level) into resistance.

Created on December 27, 2024

• The Canadian dollar initially did rally a little bit during the trading session, but it is somewhat stagnant at this point, which makes a certain amount of sense as we are getting close to the crucial 110 yen level.
• The 110 yen level is the beginning of a zone of resistance that extends to the 111.50 yen level.
• So, I think you have to look at this as a process, not necessarily something that just takes off.

Now, having said all of that, the US dollar is beating up on the Japanese yen, and I think that does have a little bit of a knock-on effect, but it’s also worth noting that we are at the 200-day EMA. The stochastic oscillator is starting to crossover in the overbought condition as well, and as this market has been somewhat sideways over the last several months, that could come into play.

Interest Rates Not as Big Here

However, the interest rate differential between most currencies and the Japanese yen is still fairly wide, although it’s probably worth pointing out in Canada, not as much as many of the other majors. The biggest thing that this pair has going for it is the fact that it’s denominated in Japanese yen. I do not like the Canadian dollar at all, but in this case, the Canadian dollar just is a touch stronger than the Japanese yen.

You still get paid swap at the end of every day, assuming that you’re with a reputable broker, but you also have to recognize the fact that there is going to be quite a bit more work to do here than there would be in say the US dollar against the yen or maybe even the pound against the yen. Short-term pullback should be thought of as buying opportunities with a 50 day EMA, probably offering quite a bit of support as well. Furthermore, we also have the 106 yen level that drops down to the 105 yen level offering a large region of support. I’m a buyer, not a seller, but not an avid buyer.

Want to trade our daily forex analysis and predictions? Here’s a list of forex brokers in Japan to check out. 

Gold (XAU/USD) is trading at $2,633.03, down 0.03%, consolidating above its pivot at $2,631.59. The 50-day EMA at $2,624.82 offers near-term support, while the 200-day EMA at $2,639.07 signals broader consolidation.

Immediate resistance is at $2,651.62, with potential to rise toward $2,676.43. Support lies at $2,608.24, with a break below targeting $2,584.66.

Gold’s outlook remains cautiously optimistic above $2,630, but a breach could trigger bearish momentum.

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.