• Pound capped by Bailey’s dovish remarks after BoE keeps Bank Rate at 4% amid inflation concerns.
• BoJ expected to hold rates steady after data showed slower growth, though GDP figures confirm ongoing expansion.
• Technicals point to consolidation, with key resistance at 201.50 and support seen around 199.50–198.90 levels.

The GBP/JPY prints back-to-back bullish candles, posting solid gains of 0.11% on Thursday, though it remains shy of re-testing the current year-to-date (YTD) high of 201.72.

Traders digested the Bank of England’s decision to hold rates, though a dovish tilt by the BoE’s Governor Andrew Bailey, capped the British Pound advance.

Conversely, the Bank of Japan is expected to hold rates on today’s meeting, as the bank’s paused its hiking cycle as data revealed that growth slowed. Nonetheless, recent GDP figures showed that the economy continues to grow.

GBP/JPY Price Forecast: To consolidate, within a 130-pip range

From a technical perspective, the GBP/JPY remains poised to extend its gains, but in the short term it could consolidate within the 200.04-201.30 range. The Relative Strength Index (RSI) is bullish, but it has turned flattish. This indicates that neither buyers nor sellers have the upper hand.

If GBP/JPY climbs above 201.00, the next resistance would be 201.50 before challenging the yearly high at 201.72. On further strength, the next area of interest would be 204.23, July 24, 2024, peak.

Conversely if the cross-pair slumps below 200.00, the first support would be the 20-day SMA at 199.49, before testing the 50-day SMA at 198.91. A breach of the latter will expose the August 29 low of 197.94.

GBP/JPY Price Chart – Daily

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• EUR/JPY has reached a fresh 14-month high at 174.47 on Thursday.
• The 14-day Relative Strength Index remains above 50, indicating a persistent bullish bias.
• The crucial level of 173.00 could act as the primary support.

EUR/JPY advances more than a quarter of a percent, trading around 174.40 during the European hours on Thursday. The technical analysis of the daily chart indicates an ongoing bullish bias as the currency cross moves upwards within the ascending channel pattern.

The 14-day Relative Strength Index (RSI) is positioned above the 50 mark, strengthening the bullish bias. Additionally, the short-term price momentum is stronger as the EUR/JPY cross remains above the nine-day Exponential Moving Average (EMA).

The EUR/JPY cross has marked a fresh 14-month high at 174.47 on Thursday, which is aligned with the crucial level at 174.50. Further advance would target the upper boundary of the ascending channel around 174.70. A break above the channel would strengthen the bullish bias and support the currency cross to explore the region around the all-time high of 175.43, reached in July 2024.

On the downside, the initial support lies at the psychological level of 173.00, followed by the nine-day EMA of 173.43. A break below this level would weaken the short-term price momentum and prompt the EUR/JPY cross to navigate the region around the ascending channel’s lower boundary around 172.20, followed by the 50-day EMA at 171.75.

EUR/JPY: Daily Chart

• The GBP/USD forecast indicates renewed strength in the pound as focus shifts from the Fed to the BoE.
• Powell said the Fed would continue easing, with forecasts showing two more cuts this year.
• The Bank of England will likely keep interest rates unchanged.

The GBP/USD forecast indicates renewed strength in the pound as focus shifts from the Fed meeting to the upcoming Bank of England meeting. Initially, the currency collapsed as the US dollar gained after the Fed decision. However, traders are now expecting a cautious tone from the Bank of England due to high UK inflation.

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The dollar initially collapsed after the Fed cut interest rates by 25-bps as expected. However, it recovered soon after since market participants had already priced in most of the move. Meanwhile, Powell said they would continue easing, with forecasts showing two more cuts this year. However, the outlook for next year remains uncertain, with traders having priced just one rate cut.

“The revised forecasts highlighted the degree of uncertainty that remains over the outlook,” said Elliot Clarke, head of international economics at Westpac.

“The timing and scale of the forecast rate cuts also point to lingering risks for inflation.”

Meanwhile, the Bank of England will likely keep interest rates unchanged. The central bank is grappling with high inflation that has caused caution among policymakers. Moreover, experts are only predicting one more rate cut this year.

GBP/USD key events today

• Bank of England policy meeting
• US unemployment claims

GBP/USD technical forecast: Bulls show readiness to bounce off the 30-SMA

On the technical side, the GBP/USD price has bounced off the 30-SMA after dropping to retest the line. If it respects this support, the bullish bias will remain intact. Meanwhile, the RSI trades above 50, suggesting solid bullish momentum.

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GBP/USD rallied to a new high in the previous session and briefly punctured the 1.3701 resistance level before pulling back sharply. The pullback allowed the price to retest the 30-SMA after such a steep climb. However, it also revealed some strength among bears, who made large red candles.

If the SMA holds firm, bulls will retest the 1.3701 resistance and likely break above to make a new high. Such a move will continue the bullish trend. On the other hand, if bulls fail to reach a new high or the SMA gives way at any point, the bias will change to bearish.

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• Bitcoin did initially try to rally during the trading session on Wednesday, but we have given back gains near the $117,000 level, an area that has been important more than once.
• And really, with that being the case, I think you’ve got a situation where traders are looking at this through the prism of a market that has been a little bit noisy.
• And with that being said, I think you’ve got a situation where the fact that the FOMC interest rate decision press conference and statement all come later in the day, it’s not a huge surprise to see a certain amount of hesitation or perhaps even liquidation in order to get away from the market and see what the Federal Reserve is going to do.

A lot of retail Bitcoin traders have no idea that the Federal Reserve has a major influence on Bitcoin. It always has. It’s kind of ironic because Bitcoin was essentially invented to get away from fiat currencies. And now it’s driven by central bank policy.

The Fed Will Matter

Why is this? Well, it’s because Wall Street has its hands in Bitcoin. So, Bitcoin is going to behave like every other Wall Street asset, like it or not. At this point, if Wall Street thinks that the Federal Reserve is going to be tighter than anticipated over the next six months or so, that causes panic and that probably has Bitcoin selling off.

On the other hand, if the Federal Reserve looks like they are going to cut two more times later this year and not in a panic, that could be reason enough for Bitcoin to rally and head towards the $120,000 level. This is a market that’s been very choppy and noisy as of late, but it is worth noting that recently we have formed a lower low.

Now the question is, are we going to form a lower high? I think we might know the answer to that in the next few days.

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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.

Platinum price is affected by the contradiction between the main indicators, which forces it to delay the bullish attack by reaching below $1400,00, to provide mixed trading to keep its stability main stability above the critical support at $1355.00.

We expect the continuation of forming mixed trading until gathering the positive momentum, to pave the way for holding above $1400.00, to begin recording extra gains that might begin at $1435.00, while the decline below the critical support and holding below it will force the price to activate the negative track, which forces it to suffer several losses by reaching $1315.00 and $1300.00.

The expected trading range for today is between $1355.00 and $1395.00

Trend forecast: Fluctuated within the bullish trend

Platinum price is affected by the contradiction between the main indicators, which forces it to delay the bullish attack by reaching below $1400,00, to provide mixed trading to keep its stability main stability above the critical support at $1355.00.

We expect the continuation of forming mixed trading until gathering the positive momentum, to pave the way for holding above $1400.00, to begin recording extra gains that might begin at $1435.00, while the decline below the critical support and holding below it will force the price to activate the negative track, which forces it to suffer several losses by reaching $1315.00 and $1300.00.

The expected trading range for today is between $1355.00 and $1395.00

Trend forecast: Fluctuated within the bullish trend

– Written by


Frank Davies

STORY LINK Euro to Dollar Forecast: EUR Hits 4-Year Highs Before Fed Sparks USD Rally

The Euro to Dollar (EUR/USD) briefly surged to 1.1880, its strongest level in four years, before fading after the Federal Reserve cut rates by 25bp and signalled three more reductions this year.

The initial reaction sent the dollar down by around 0.5%, but US yields quickly reversed higher and the greenback clawed back losses, leaving EUR/USD back near 1.1845.

ING says the reversal reflected positioning rather than a shift in the Fed’s message, underscoring that this is “a trader’s market.”

Fed delivers 25bp cut, signals more to come

The Federal Reserve lowered its policy rate by 25bp as expected and indicated three further cuts in 2025 to boost growth and revive the labour market.

ING commented;

“The Fed cut the policy rate 25bp as expected. They think three more cuts will be enough to boost growth and prompt a revival in the jobs market, but the market is sceptical. We look for four more 25bp cuts before trade clarity, a weaker dollar and lower borrowing costs start to stabilise the situation.”

The market’s initial response was sharp, with the dollar sold off aggressively across the board.

ING analysts added;

“Dollar bears went into this meeting a little nervous that the Fed wouldn’t deliver for them. In the end, the Fed delivered on expectations of three cuts this year and the first reaction for the dollar was to fall across the board by around 0.5%.”

“Within about 30 minutes, however, the dollar had more than recouped its losses as US yields reversed higher. We suspect this reversal had more to do with positioning rather than a less dovish re-assessment of today’s communication from the Fed. A trader’s market.”

The Euro had entered the Fed meeting on a strong footing, breaking out of a 10-week range as inflows drove EUR/USD to 1.1880. Analysts said momentum looked hard to resist.

ING noted;

“EUR/USD has broken to the topside of a 10-week trading range, and it looks hard to resist the move. Seasonality now builds against the dollar – especially in November and into December – and 1.1910 looks like the final resistance level before 1.20 is hit.”

UoB added;

“While the sharp rally appears excessive, strong momentum continues to suggest a higher EUR today. That said, it remains to be seen if EUR can break above the next resistance at 1.1915.”

HSBC maintains a year-end target of 1.20 for EUR/USD.

EUR/USD: Risks and positioning

Not all analysts expect a straight path higher. Danske Bank said;

“With EUR/USD rallying sharply in recent sessions and 25bp cuts already almost fully priced for the remainder of the year, we would be surprised to see the cross extend materially higher post-FOMC. While we remain strategically bullish on EUR/USD over the medium term, near-term risks look more balanced.”

It added;

“EUR/USD could come under pressure if the Fed signals a preference for quarterly rather than sequential cuts. In our view, the bar for a dovish surprise is high, given current market pricing and inflation still running above target.”

IG’s Tony Sycamore said any dollar rebound could prove temporary;

“In light of that, we believe any ‘buy the rumour, sell the fact’ reaction will be short-lived, given the possibility of follow-up 25 bp rate cuts in October and December.”

HSBC concluded;

“One could argue that this likely policy divergence between the Fed and the ECB is already priced into the market. But it is difficult to sell EUR/USD when there is still a lively debate around how much and how quickly the Fed might ease while there is little debate about whether the ECB may need to act.”

Live Exchange Rates:
Pound to Dollar (GBP/USD): 1.36292 (-0.18%)
Euro to Dollar (EUR/USD): 1.1816 (-0.47%)
Dollar to Japanese Yen (USD/JPY): 146.944 (+0.37%)

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TAGS: Euro Dollar Forecasts

Despite the weak trading of Platinum price recently, its stability above the moving average 55 reinforces the stability of the extra support at $1382.00, besides stochastic attempt to provide positive momentum, these factors assist confirming the continuation of the positivity, to keep waiting for breaching the obstacle of $1408,00 to ease the mission of achieving the main targets that begin at $1435.00.

The risk of changing the main trend is represented by attempting to break the critical support at $1355.00, forcing it to form strong bearish waves, to expect reaching $1302.00 initially reaching to 38.2%Fibonacci correction level at $1255.00. 

The expected trading range for today is between $1375.00 and $1425.00

Trend forecast: Bullish