The EUR/USD pair is currently trading at 1.1362, and is showcasing further signs of weakness after recently sliding beneath the 1.1325 support zone. Below both of the moving averues, and in a lower high formation, the pair has further potential to the downside, and could still be in a short term formation.

I will be looking for the first significant level of resistance to be near the 1.1412 level. If the pair is able to rise above 1.1412, further resistance may come in near 1.1455, 1.1504 and 1.1558 respectively. If current support at 1.1325 is broken, further support may come in near 1.1266 and 1.1211.

While RSI has been showing some bullish signs near oversold territory, I believe further downside may be limited at the current time. If current support is broken, I may gain a bearish bias near 1.1266. I would gain a bearish bias near 1.1412 if it is tested and broken, and would need to see a bullish move above 1.1455 to negate my current bearish bias.

EURJPY maintained its negative stability since yesterday’s trading below the additional resistance barrier at 179.45, approaching the downside target at 178.00 by a narrow margin before being forced into some sideways trading in an attempt to gather additional negative momentum.

In general, the bearish bias will remain valid as long as the resistance level at 180.80 holds, keeping the way open for further bearish waves that could soon extend toward 177.80, followed by the next target near 176.70.

The expected trading range for today is between 177.80 and 179.50

Trend forecast: Bearish

EURGBP ended its bullish corrective rebound after facing the resistance of the descending channel at 0.8605, forming a quick bearish reversal that pushed the price to stabilize below the 55-period moving average, targeting 0.8565.

Currently, stochastic provides additional bearish momentum, the effectiveness of the bearish path is expected to increase, waiting for the price to target the next downside levels, which may start at 0.8535 and 0.8510.

The expected trading range for today is between 0.8535 and 0.8590.

Trend forecast: Bearish

– Written by


James Fuller

STORY LINK GBP/USD Forecast: Pound Sterling Gains as UK Fuel Prices Hit Record High

The Pound US Dollar (GBP/USD) exchange rate gained ground on Monday as UK diesel prices reached a record high, strengthening expectations of higher Bank of England (BoE) interest rates.

However, the pair’s advance remained limited.

At the time of writing, GBP/USD was trading at $1.3265 after briefly climbing to a five-day high.

The Pound (GBP) strengthened on Monday after UK diesel prices climbed to a new record, leading markets to raise their expectations for tighter Bank of England monetary policy in the months ahead.

Average diesel prices at UK forecourts reached 199.18p per litre, moving above the previous record set in June 2022 following Russia’s full-scale invasion of Ukraine.

Higher fuel costs can feed through into wider inflationary pressures, particularly if businesses reliant on diesel-powered transport pass increased operating expenses on to customers.

As the risk of renewed inflation became more prominent, markets began to anticipate a more hawkish approach from the BoE.

Meanwhile, the US Dollar (USD) found some support on Monday as fresh developments surrounding the Middle East crisis encouraged a degree of caution among investors.

Over the weekend, the US rejected an Iranian peace proposal that would have seen the Strait of Hormuz reopened within seven days.

President Donald Trump subsequently said he expected negotiations to resume shortly, although Tehran disputed his account.

However, developments in US-China trade relations offered some reassurance, preventing a decisive shift towards risk aversion.

Following in-person talks between President Trump and Chinese President Xi Jinping last week, both sides published lists outlining around $30bn each in tariff cuts, potentially providing a boost to Sino-American trade.

Near-Term GBP/USD Forecast: US Data and Middle East Tensions in Focus

Looking ahead, the latest US Job Openings and Labor Turnover Survey (JOLTS) is due on Tuesday.

A modest reduction in job vacancies could take some of the shine off the US Dollar.

At the same time, the ‘Greenback’ could find support if September’s consumer confidence reading comes in higher as forecast.

However, if escalating Middle East tensions and expectations of higher interest rates had a stronger-than-expected impact on consumer morale last month, the US Dollar could come under pressure instead.

For the Pound, Tuesday’s UK calendar is relatively quiet, putting the spotlight on domestic political developments.

Updates from the Labour Party Conference could consequently influence Sterling.

Bank of England policymaker Alan Taylor is also due to speak, and his remarks could help shape expectations around the central bank’s future policy.

Any dovish signals may add to the pressure on the Pound.

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Traders also had a chance to take a look at the Dallas Fed Manufacturing Index report. The report indicated that Dallas Fed Manufacturing Index declined from 11.6 in August to 9.8 in September, compared to analyst forecast of 1.

In case U.S. Dollar Index stays above the 101.00 level, it will head towards the next resistance level, which is located in the 101.50 – 101.65 range. A successful test of this level will open the way to the test of the next resistance at 102.35 – 102.50.

• GBP/JPY’s tests two-week lows below 208.00 after being rejected at 209.00.
• The Pound resumes its bearish trend after a mild recovery attempt during the Asian session.
• The BoJ minutes highlight an increasing concern about inflation and policymakers’ willingness to accelerate rate hikes.

The British Pound (GBP) extends losses against the Japanese Yen (JPY) on Monday, following a mild recovery attempt earlier in the day. The GBP/JPY hit fresh two-week lows at the 207.70 area on Wednesday, after being rejected at 209.00 in the Asian session, highlighting a more than 1% decline over the last two trading days and nearing oversold levels on intraday charts.

The Bank of Japan (BoJ) released the minutes of July’s meeting earlier on Monday, which showed that some policymakers called for faster interest rate hikes in July, in light of the mounting inflation risks. The minutes, however, failed to have any significant impact on the pair at the moment of their release.

The bank hiked interest rates in September, but the two dovish dissenters in the committee left investors pondering the ability of the BoJ to tighten its monetary policy much further and sent the Yen lower across the board.

In the UK, the Bank of England has turned hawkish with Governor Bailey and Deputy Governor Clare Lombardelli hinting at interest rate hikes ahead, although, according to HSBC analysts, “weak UK labour demand and sluggish private sector momentum could weigh on the GBP in the near term”

Apart from that, the political and fiscal backdrop is an additional source of weakness for the pound, says HSBC, noting that “the run-up to the budget update on 28 October may add further pressure, with elevated gilt yields and difficult fiscal choices ahead for the new Chancellor.”

Technical Analysis: Testing support at 207.80 with RSI approaching oversold levels

GBP/JPY trades at 208.00, holding the near-term bearish structure in place. Momentum indicators in the 4-hour chart remain bearish, with the Relative Strength Index (14) just above oversold levels and the Moving Average Convergence Divergence (MACD) histogram printing widening red bars, which suggests that upside attmepts are likely to find sellers.

Bears have pierced a trendline resistance from early September lows, at 208,10 and are now testing the support area around 207.80 (September 17 and 25 lows) with their focus on the key support area at the September 8 trough of 207.10.

On the topside, initial resistance arrives at 209.00, which has capped bulls on Monday. A clear break of that level would expose the horizontal resistance around 210.10 (September 23, 24 highs) ahead of the September 22 high at 210.90.

(The technical analysis of this story was written with the help of an AI tool. Know more.)

EURJPY confirmed its commitment to the bearish scenario by recently closing below the resistance level at 180.80. During Friday’s trading, the pair posted a sharp decline, approaching the first additional target at 178.60.

The price now needs to gather further negative momentum to remain below 179.40, allowing it to renew pressure on the target at 178.60. A break below this level could extend the decline directly toward the next bearish target around 177.40.

The expected trading range for today is between 178.00 and 180.00

Trend forecast: Bearish

Crédit Agricole expects renewed Yen weakness before a 2027 recovery, while JPMorgan sees near-term demand from Japanese investors.

Crédit Agricole expects the US Dollar to Japanese Yen (USD/JPY) exchange rate to climb to 163 by December 2026, even as JPMorgan identifies signs of Japanese buying interest in the Yen.

Friday’s close of 157.29 leaves Crédit Agricole’s year-end forecast around 3.6% above the market.

USD/JPY fell 0.97% that day, surrendering most of its weekly advance as the Yen recovered following fresh comments from Finance Minister Satsuki Katayama about US concerns over Yen weakness.

Crédit Agricole’s path falls from 163 in December to 162 in March 2027, 161 in June, 158 in September and 156 in December 2027.

It argues that official currency support needs stronger backing from monetary policy:

“Record levels of intervention have capped USD/JPY’s rally at 164, but for the JPY to stage a sustainable rally, the BoJ needs to accelerate the pace of its rate hikes, reducing the currency’s appeal as a carry funder.”

JPMorgan’s 157.80 pivot has already given way

JPMorgan’s earlier assessment identified two support levels:

“Rate check pivot around 157.80 will provide some short term support with 156.50/60 below”

Friday’s close was beneath that first level, leaving 156.50-156.60 as the next lower area to watch.

The desk saw more local Yen demand near recent USD/JPY highs, although overseas institutional investors had increased Yen selling during the week.

It also questioned how effectively intervention could offset broader pressures:

“As you know I really do not doubt the intentions but I am starting to worry about the efficacy of the actions so far in the face of what is a huge energy and fixed income shock.”

Crédit Agricole similarly cites elevated oil prices and Japanese fiscal concerns as obstacles to lasting Yen gains.

The 156 end-2027 forecast is less than 1% below Friday’s close, but the intervening path includes renewed Yen weakness towards 163 before that recovery.

Our currency coverage draws on live market data, official economic releases and published bank research.