Created on January 09, 2026

• The carry trade is still a very strong driver at the moment in a lot of the Japanese yen-related pairs, including the USD/JPY market.
• The US dollar drifted a bit lower against the Japanese yen to kick off the Thursday session, but we have seen a turnaround show us signs of upward momentum.
• The carry trade is still a very strong driver at the moment in a lot of the Japanese yen-related pairs, so despite the fact that the Bank of Japan has recently raised interest rates, the reality is that they are light years away from trying to tighten monetary policy enough to really turn things around.

With this being said, the market will, of course, remain a little bit noisy, but if we can break to the upside and finally clear the 158 yen level, we could really take off. At that point, I think we could go looking to the 160 yen level, which is an area where the Bank of Japan intervened ages ago.

Technical Support and Future Targets

Short-term pullbacks will end up being buying opportunities, I believe, and as a result, the support levels that I’m watching include the 50-day EMA and the 155 yen level. These are areas that I think will remain very important, but I think it is difficult to break down below.

If we were to break down below that area, then you could have a lot of problems for the US dollar, and I think you have a situation where if that does in fact happen, the 152 yen level might be your next target.

Ultimately, though, despite the fact that the Bank of Japan has raised interest rates and the Federal Reserve has cut, you still have a pretty wide gap between the two, and therefore, if you’re looking for the carry trade to play out, you are looking for the US dollar to remain somewhat resilient against the Japanese yen. Beyond that, the US dollar itself is fairly resilient, mainly due to the fact that the economic numbers coming out of America are stubbornly strong, so even if the Federal Reserve does cut it can only do so in a limited way.

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

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.

The GBPJPY pair lost the bullish momentum due to stochastic exit from the overbought level, which forces it to delay the bullish attack by reaching below 211.30 level, which keeps forming an important obstacle against the bullish attempts.

We expect providing new mixed trading with a chance of attacking the minor bullish channel’s support at 210.10, breaking this support makes us expect targeting extra corrective stations that might begin at 209.45 and 208.80, while the trading rally above the obstacle will increase the chances of recording new gains by targeting 212.55 and 213.75 level.

The expected trading range for today is between 210.10 and 211.50

Trend forecast: Fluctuated within the bullish trend

GBP/USD Technical Analysis

The British pound, of course, has drifted a little bit lower. We are in an area of consolidation. I don’t think that changes today. You could, in theory, see a little bit of a bounce when we get closer to 1.34, but really, I think this is the domain of short-term traders more than anything else, with 1.35 being a bit of a magnet for price.

The Bank of England is expected to cut rates as well, but it is expected to do so in a much slower and gradual manner than the market once thought, hence the British pound’s strength over the last couple of months. I think this is a currency that, relatively speaking, at least will fare better than many others against the greenback.

EUR/GBP Technical Analysis

The euro has climbed slightly against the British pound as we continue our bounce from the 200-day EMA, but I will direct you to my analysis from a couple of days ago. I think we’re going to start drifting towards the 0.8720 area and then maybe see some exhaustion that we can start shorting again.

While the Bank of England is expected to cut rates, it’s doing so at a much slower pace, and this, of course, is in comparison to the ECB, which is basically on hold, so we already know that the interest rate differential will continue to favor the pound for some time. That doesn’t necessarily mean that we fall apart. I just think that you’re going to continue to see more of a rally and then a fade type of situation going forward.

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

Created on January 08, 2026

The British pound continues to consolidate on Thursday, as we are waiting for the all-important Non-Farm Payroll numbers in the United States.

• I am looking at the British pound against the US dollar. The British pound continues to consolidate, although it was somewhat negative during the trading session on Thursday, but I think you’ve got a situation where we’re basically bouncing around between 1.34 and 1.3550.
• With that, we’re waiting on something. I think the most obvious candidate will be the non-farm payroll announcements coming out on Friday in the United States.

The non-farm payroll announcement, while in and of itself isn’t particularly interesting and not even particularly accurate, will have a major influence on what people think the Federal Reserve will do. The unemployment rate in America is expected to be 4.5%. The non-farm employment change is supposed to be an addition of 66,000 jobs.

With that being the case, I think it comes down to the number. The higher the number, the better off the US dollar does because we have a situation here where the Bank of England is cutting but is doing so slowly, and if the Federal Reserve has a reason to pause, then that means the dollar is mispriced.

Monitoring Support and Resistance

That being said, in the short term, it looks like we’re still range-bound. It will be interesting to see if we can break out of this little rectangle. A move above 1.36 would be bullish, especially if the US dollar is falling against everything else. In that case, then yes, the GBP rises here.

On the other hand, if we break down below the 50-day EMA currently right at the 1.3367 level, then I think you start to see the dollar strengthen against the pound quite a bit, maybe even a couple of handles.

Ready to trade our daily GBP/USD Forex forecast? Here’s some of the best forex broker UK reviews to check out.

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.

– Written by


Ben Hughes

STORY LINK Pound Sterling to Dollar Forecast: Can GBP Break Higher as USD Backing Fades?

The Pound to US Dollar exchange rate (GBP/USD) remained capped below 1.35 as signs of fragility in the US labour market offset lingering caution over global risk conditions.

With momentum slowing, traders are watching whether support can hold above the mid-1.34s.

GBP/USD Forecasts: Hold Near 1.35

The Pound to Dollar (GBP/USD) exchange rate has been held in tight ranges and traded just below 1.35 after the New York open. Tough resistance remains above 1.3550.

According to Scotiabank, the trend is bullish, but momentum has faded; “We note the importance of the 200 day MA at 1.3388, and we look to a near-term range roughly bound between 1.3450 and 1.3550.

UoB added; “Upward momentum has slowed with the pullback, and today, we expect GBP to range-trade, most likely between 1.3470 and 1.3535.”

Equity markets were less confident on Wednesday with limited pullbacks and the tone surrounding risk appetite was slightly less confident.

There is scope for increased volatility given geo-political tensions and important US data releases.

According to Scotiabank; “Calm, low volatility trading risks getting a shake up over the coming days.”

US ADP jobs data recorded an increase in private payrolls of 41,000 for December, slightly below consensus forecasts of around 50,000 and followed a revised 29,000 decline for November.

ADP chief economist Dr. Nela Richardson commented; “Small establishments recovered from November job losses with positive end-of-year hiring, even as large employers pulled back.”

Elsewhere, the JOLTS data recorded a decline in job openings to 7.15mn for November from 7.45mn previously and below consensus forecasts of 7.60mn.

There was, however, a stronger than expected reading for the ISM services-sector index.

Overall, markets are still not expecting the Federal Reserve to cut rates again in January, although traders are still on alert for an announcement on the next Fed Chair.

ING commented; “Beyond today, our short-term view remains neutral to slightly bullish on the greenback.”

Geo-political developments will be watched closely with Venezuela and Greenland both important areas.

Macquarie Group global forex and rates strategist Thierry Wizman commented; “Traders seem to be okay with the rhetoric coming from the U.S. when it does not imply that ‘boots on the ground’ will be needed to run Venezuela.”

He added; “A military invasion and a prolonged on-the-ground conflict would have risked a major dollar depreciation, as did the Iraq and Afghanistan wars in 2002-2008,

There has also been speculation that the Supreme Court could announce a decision on US reciprocal tariffs on Friday when it will hold an opinion day.

If there is a decision, MUFG commented; “We lean toward the Supreme Court striking down the use of IEEPA which will trigger a bout of uncertainty for US companies once again.

The bank expects there are plans to expand other tariffs if necessary.

According to the bank; “It’s unlikely that Plan B will be as all-encompassing and hence tariff revenue expectations would likely be downgraded, potentially steepening the US Treasury yield curve and potentially weakening the dollar. In any case, it adds renewed uncertainties for US companies that would be unhelpful for corporate sentiment.”

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TAGS: Pound Dollar Forecasts

Created on January 08, 2026

The US dollar continues to drift a bit against the yen, as we are in the middle of a major consolidation area. Traders will likely be focused on Non-Farm Payroll this Friday for the next move.

The US dollar drifted a little bit lower against the Japanese yen during early trading on Wednesday, as we continue to stay stuck between two major levels in consolidation. With that, I’m watching the 158 yen level above very carefully as it is a major resistance barrier, and the 154.50 yen level below as it is a major support level. It’s worth noting that the 50-day EMA has just crossed the 155 yen level, so it is potential support there as well.

As we go through the week, we’ll start to focus on the non-farm payroll announcement, and that tends to have a major influence on this pair and, by extension, causes it to react to the bond markets, which obviously will move as well. The interest rate differential still favors the US dollar, so I still favor the upside overall.

Market Reaction to Bank of Japan

I also recognize that this is more or less a consolidation than anything else. The market is likely to remain somewhat tight and rangebound for the short term, but eventually, we will have to make a decision, perhaps in the next Bank of Japan meeting, as there are a lot of questions as to whether or not they will actually attempt to tighten monetary policy.

With the massive amount of debt in Japan, it’s difficult to imagine that being a long-term play, but in the short term, it does cause some noise here. Anything above the 158 yen level really has this market taking off. I suspect running to the 160 yen level.

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

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.

Oil Steadies After Recent Declines, with Geopolitical Tensions and Data Still in Focus

has steadied around 56.00 after two days of declines. Oil prices have fallen 2% so far this week as Venezuela’s supply weighs on the market and investors digest recent data.

Oil has been under pressure following the U.S. announcement of plans to import 50 million barrels of Venezuelan crude oil, raising concerns about oversupply.  While typical geopolitical tensions in an oil-producing region can lift oil prices. This isn’t the case here as the prospect of increased supply keeps prices under pressure.

There have been some supportive developments that have helped stem the selloff.

US crude stockpiles fell by more than expected, an indication of demand strength, which, together with a stronger-than-expected , helped to support prices for now. Attention will turn to US and Chinese inflation data.

Investors will continue to monitor geopolitical developments, particularly reports in the Wall Street Journal that Trump plans to assume long-term control of Venezuela’s oil to bring prices down to $50 per barrel.

Oil Forecast- Technical Analysis

Oil trades in a multi-month descending channel. Recent failure to rise above the 50 SMA, combined with the RSI below 50, keeps sellers hopeful of further declines.

After rejection at the 50 SMA, the price rebounded lower and is testing support at 56.00, the October low. Sellers will look to take out this level, opening the door to 55.00, the 2025 low. Below here, attention turns to 50.00, a level last seen in 2021.

On the upside, resistance is seen at 58.70, the 50 SMA, and the upper band of the falling channel. A rise above here creates a higher high and brings 60.00, the round number, into focus. A rise above here exposes the 200 SMA at 62.50.

EUR/USD Holds Steady Ahead of US Data

is holding steady for a second day following mixed data yesterday and ahead of further US figures today.

The pair is so far on track for a small decline at the start of 2026, following a 13.5% jump last year.

The EUR is looking ahead to consumer, business, and economic sentiment data for the region. This comes after yesterday’s inflation figures, which showed eased to 2% YoY, down from 2.1% in November and reaching the ECB’s target level for the first time since August. The data support the view that the ECB will not cut rates again this year, which could keep the EUR underpinned.

However, investors will closely monitor the Trump Greenland story. While this is not impacting the EUR for now, any sense that Trump could move forward with plans to acquire Greenland could pull the EUR lower.

The is calm on Thursday ahead of US jobless claims. Data on Wednesday showed that the US labour market was in a low-hiring, low-firing state, with job openings falling by more than forecast. However, the service sector unexpectedly ramped up in December, with the services PMI reaching a 14-month high. These data points present a mixed picture for the Federal Reserve, which could reinforce a cautious stance.

The market is pricing in two this year, compared with the Fed’s one. Policymakers are divided over the outlook, but no rate cut is expected this month.

EUR/USD Forecast- Technical Analysis

EUR/USD’s recovery from 1.15, the November low ran into resistance at 1.18 and rebounded lower. The price is testing the 1.1670 support zone.

Sellers supported by the RSI below 50 will look to break below this support zone and the 50 SMA at 1.1640. A break below here exposes the 200 SMA at 1.1560 before bringing the 1.15 level back into focus.

Should the 1.1670 support zone hold, buyers will look to rise above 1.17 before bringing 1.18 into play.

Original Post

The EURJPY pair continued providing weak sideways trading, fluctuating near the extra support at 182.80, affected by the continuation of the main indicators besides forming extra obstacle at 183.50 level as appears in the above image.

Therefore, we will remain neutral until providing signal for detecting the main trend in the near and medium trading, while breaking the current support and providing negative close will confirm the bearish corrective trend, which might target 182.30 and 181.75 level initially, while breaching 183.50 level will ease the mission of detecting the bullish attempts, to expect its rally towards 183.85, to attack the broken channel’s support in order to find an exit for regaining the bullish trend again.

The expected trading range for today is between 182.80 and 183.50

Trend forecast: Neutral