InvestMacro

By RoboForex Analytical Department

The GBP/USD pair held around 1.3430 USD on Thursday, with the pound strengthening yesterday following better-than-expected UK economic growth data. These figures may shape market expectations for Bank of England policy in the coming months.

Since the start of January, sterling has made limited headway against the US dollar but has strengthened notably against the euro. Dollar sentiment remains cautious due to geopolitical tensions involving Iran and Greenland, as well as renewed comments from President Donald Trump questioning the Federal Reserve’s independence.

Investor sentiment toward the pound has turned more constructive at the start of 2026. According to the US Commodity Futures Trading Commission (CFTC), traders reduced bearish bets on the pound at the fastest pace in five months during the first week of January. The net long dollar position against sterling fell sharply to 2.577 billion USD, down from 6.586 billion USD at the end of December—marking the steepest weekly decline since September 2019.

Inflation in the UK eased faster than expected toward the end of 2025, and markets are currently pricing in two BoE rate cuts this year. However, analysts view this as overly optimistic: persistently weak growth and subdued inflation could ultimately weigh on the currency. Upcoming soft employment and inflation data for December will be key to reassessing the likelihood of a rate cut as early as February, though markets currently assign low odds to such a move.

Next week brings key releases, including consumer prices and labour market data, followed by GDP figures on Thursday. A Reuters poll suggests the UK economy contracted by 0.2% in the three months to November, with annual growth estimated at around 1.1%.

Technical Analysis: GBP/USD

H4 Chart:

On the H4 chart, GBP/USD is forming a broad consolidation range around 1.3455 USD. The range is expected to extend toward 1.3395 USD, followed by a corrective bounce to 1.3415 USD. Once complete, the downtrend may resume toward 1.3290 USD, with further potential to 1.3220 USD. The MACD indicator supports this bearish near-term outlook, with its signal line below zero and pointing firmly downward.

H1 Chart:

On the H1 chart, the pair has established a tight consolidation range around 1.3440 USD. A downward move toward 1.3395 USD is in progress, and a break below this level would open the door to further declines toward 1.3290 USD. The Stochastic oscillator aligns with this view, as its signal line is below 20 and trending lower, indicating sustained selling momentum.

Conclusion

Despite improving sentiment and a sharp reduction in speculative short positions, the pound remains vulnerable to downside risks from domestic data and shifting BoE expectations. Technically, the pair retains a near-term bearish bias, with key support levels at 1.3395 USD and 1.3290 USD. A break below these levels could accelerate declines, while any sustained recovery would likely require stronger-than-expected UK data in the coming week.

Disclaimer:

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

By RoboForex Analytical Department

The EUR/USD pair stabilised around 1.1658 on Tuesday, following a period of volatility over the preceding two sessions.

Market focus remains firmly on the forthcoming US inflation data, which is expected to provide crucial clarity on the future path of Federal Reserve policy. Currently, the market is pricing in two rate cuts this year, with the first anticipated in June. However, any upside surprise in inflation could significantly temper expectations for policy easing.

Supporting a more dovish outlook was last week’s disappointing Non-Farm Payrolls (NFP) report for December, which revealed weaker-than-expected job growth.

Investors are also monitoring developments in the US Supreme Court, which is expected to rule on the legality of President Donald Trump’s tariff policy as early as Wednesday.

Earlier this week, the US dollar faced additional headwinds following reports that Fed Chair Jerome Powell could face scrutiny over his congressional testimony related to a building renovation project. This has raised concerns, albeit limited, regarding the perceived independence of the Federal Reserve.

Technical Analysis: EUR/USD

H4 Chart:

On the H4 chart, the pair is forming a corrective retracement within the context of the second downward impulse. The immediate corrective target stands at 1.1700. Once this correction concludes, we anticipate the resumption of the downtrend, with the next bearish target at 1.1555. This scenario is supported by the MACD indicator, whose signal line is below zero and pointing decisively downward, reinforcing the ongoing bearish momentum and potential for further downside.

H1 Chart:

On the H1 chart, the market has completed a decline to 1.1655 and is now forming an upward corrective impulse towards 1.1700. Upon reaching this level, we expect a renewed wave of selling pressure to emerge. The Stochastic oscillator aligns with this view, as its signal line is currently below 20 but is turning upward towards 80, indicating room for a short-term rebound before the next potential decline.

Conclusion

The EUR/USD pair is in a holding pattern ahead of key US inflation data, which will likely dictate the near-term direction of the pair. While the technical structure remains bearish, a corrective bounce towards 1.1700 appears likely before sellers potentially regain control. A stronger-than-expected inflation print could reinforce the dollar’s strength and accelerate the move towards 1.1555.

Disclaimer:

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

By RoboForex Analytical Department

The USD/JPY pair paused on Monday after a sharp rally to around 157.95, with the yen holding near its lowest levels of the year. Trading activity was subdued as Japanese markets were closed for a public holiday.

Political uncertainty increased after Prime Minister Sanae Takaichi, a key coalition partner, raised the possibility of early elections on 8 or 15 February, adding another layer of caution to the market.

The yen also faced pressure from recent mixed macroeconomic data, which have clouded the outlook for the Bank of Japan’s future rate-hike trajectory.

Last week, BoJ Governor Kazuo Ueda reiterated that the central bank would continue to raise interest rates if economic momentum and inflation align with forecasts, while also emphasising a flexible approach to policy adjustments.

Over the coming week, traders will focus on a series of key Japanese economic indicators, including current account figures, machine tool orders, manufacturing PMI, and business sentiment data. Any surprises could prompt a shift in the yen’s direction.

Technical Analysis: USD/JPY

H4 Chart:

On the H4 chart, the pair has completed a local advance to 157.77 and is likely to enter a period of consolidation around this level. A break below this range could trigger a corrective move towards 156.60. Conversely, an upward break would open the potential for the rally to extend towards 159.33. This outlook is supported by the MACD indicator, with its signal line positioned above zero and pointing firmly upward, indicating ongoing bullish momentum.

H1 Chart:

On the H1 chart, the market is forming a consolidation range centred around 157.77, with interim boundaries at 158.18 to the upside and 157.50 to the downside. A downward exit from this range could see a decline towards 156.60, while an upward resolution would signal potential for a further move towards 159.33. The Stochastic oscillator aligns with this view, as its signal line is above 50 and rising towards 80, suggesting continued near-term upward momentum.

Conclusion

USD/JPY has entered a period of consolidation near annual highs, with direction likely to be determined by upcoming Japanese data and political developments. While the broader technical bias remains bullish, a break below 157.50 could signal the start of a short-term correction.

Disclaimer:

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

By ForexTime 

Article by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

By RoboForex Analytical Department

The Bank of Japan’s decision to raise its policy rate to 0.75% (from 0.50%), while in line with market forecasts, marks a clear step towards monetary tightening and has pushed yields higher on Japanese assets. For the USD/JPY pair, this typically exerts downward pressure – supporting the yen’s appreciation and weighing on the exchange rate.

The underlying mechanism is straightforward: a higher interest rate in Japan boosts the relative appeal of yen-denominated investments and narrows the yield differential with the US. This, in turn, reduces the incentive for the classic carry trade – borrowing in low-yielding yen to purchase higher-yielding assets abroad – thereby increasing structural demand for the yen.

As the decision was widely anticipated, the immediate market reaction may be relatively contained. However, beyond the rate itself, the tone of the BoJ’s forward guidance will be critical. Should the central bank signal that further hikes are on the table, sustained pressure on USD/JPY is likely. Conversely, an emphasis on caution and the gradual pace of policy normalisation could limit the move to a more short-term correction.

Technical Analysis: USD/JPY

H4 Chart:

On the H4 chart, the market reached a local bullish target at 157.72 before correcting to 155.55. We expect this corrective phase to conclude around the 155.50 level, with the potential for a consolidation range to form thereafter. A break below this range would open the path towards 155.12, while an upward exit could see a renewed advance towards 157.92.

This outlook is supported by the MACD indicator, whose signal line is currently above zero but pointing firmly lower, suggesting a loss of bullish momentum in the near term.

H1 Chart:

On the H1 chart, the pair is trading within a consolidation range around 156.06. A downside break would target a decline towards 155.12, whereas an upside resolution could initiate a move towards 157.92.

This view is further validated by the Stochastic oscillator, whose signal line is below 50 and trending downward towards the 20 level, indicating continued near-term selling pressure.

Conclusion

The BoJ’s rate hike has shifted the fundamental backdrop towards yen strength, though the extent of the move will hinge on the central bank’s future signalling. Technically, USD/JPY is entering a critical consolidation phase, with a break below 155.50 likely to accelerate the correction, while a hold above could see the pair attempt to retest recent highs.

Disclaimer:

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

By RoboForex Analytical Department

The latest UK GDP data showed annualised growth of 1.3%, in line with market expectations and slightly below the previous reading of 1.4%. The report had a broadly neutral impact on sterling, as it confirms the UK economy continues to expand, albeit at a moderate pace, without signs of acceleration.

For the GBP/USD pair, the lack of surprise is the key takeaway. With the data matching consensus forecasts, investors have little reason to reassess their current macroeconomic outlook. In such cases, the pound tends not to attract fresh buying momentum but also avoids sharp selling pressure.

Nevertheless, the slight deceleration in growth from the prior period creates a modestly cautious backdrop for sterling. The softer figure may signal that the economy remains sensitive to elevated interest rates and subdued domestic demand. This interpretation could temper expectations of further monetary tightening from the Bank of England and limit the scope for more hawkish communication.

In the near term, the direct market impact of this GDP release is assessed as largely neutral, albeit with a mild downside bias for the pound. Subsequent direction will likely depend on upcoming UK inflation and labour market reports, alongside evolving US rate expectations and broader global risk sentiment.

Technical Analysis: GBP/USD

H4 Chart:

On the H4 chart, the pair has entered a broad consolidation zone around 1.3418. We anticipate a possible extension of the range towards 1.3500 in the near term, followed by a corrective pullback to 1.3418. Upon completion of this retracement, the broader upward trend is expected to resume, targeting 1.3520, with potential for further extension towards 1.3550.

This outlook is supported by the MACD indicator, with its signal line positioned above zero and pointing firmly upward.

H1 Chart:

On the H1 chart, price action formed a tight consolidation around 1.3424 before breaking higher and advancing to 1.3492 (a local target). We now expect a corrective decline to retest the 1.3424 level from above. Once this correction concludes, the focus will shift to the potential for a subsequent growth wave toward 1.3533.

This scenario is validated by the Stochastic oscillator, whose signal line is above 80 and has begun to turn lower towards the 20 level, indicating near-term corrective momentum.

Conclusion

The GBP/USD pair is likely to remain range-bound in the wake of in-line GDP data, which neither strengthens nor weakens the sterling narrative decisively. While the technical structure favours further upside in the medium term, near-term price action suggests a period of consolidation or mild correction may precede any renewed bullish impulse.

Disclaimer:

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

By RoboForex Analytical Department

At its meeting on 18 December, the European Central Bank (ECB) left all key interest rates unchanged, maintaining the deposit facility rate at 2.0%. The decision was widely anticipated, offering no fresh catalyst for meaningful euro movement. While headline inflation for the eurozone remained close to target at 2.15% in November, the ECB’s updated projections saw a slight upward revision for the coming years, primarily driven by persistent price growth in the services sector.

Concurrently, the ECB improved its GDP growth forecast for 2025–2027. However, with the decision fully priced in, it provided neither additional support nor pressure to the single currency.

The primary driver for EUR/USD now stems from US monetary policy. The recent Federal Reserve rate cut from 4.00% to 3.75% has narrowed the yield differential between the dollar and the euro. This reduces the dollar’s interest rate advantage and makes euro-denominated assets relatively more attractive, providing a moderate tailwind for the euro.

Looking ahead, medium-term dynamics will hinge on relative expectations for central bank policy. Should markets continue to price in a more aggressive easing cycle from the Fed compared to the ECB, the euro is likely to find further support. Conversely, any signs that the ECB is preparing to proactively ease policy in response to eurozone economic weakness would limit the euro’s upside potential.

Technical Analysis: EUR/USD

H4 Chart:

On the H4 chart, the pair is consolidating near the breakdown level of the previous growth channel’s lower boundary. We anticipate a downside breakout from this range and a resumption of the third decline wave, with an initial target at 1.1650.

The MACD indicator technically confirms this bearish outlook. Its signal line is below zero and pointing decisively downward, reflecting sustained bearish momentum and potential for further downside.

H1 Chart:

On the H1 chart, the market completed another decline wave to 1.1702, followed by a correction to 1.1737. A new downward impulse towards 1.1650 is currently forming. A sustained break below this level would signal the potential for an extended third wave, targeting the 1.1645 area as a local objective.

This scenario is supported by the Stochastic oscillator, with its signal line below the 50 level and trending firmly downwards.

Conclusion

The euro’s trajectory remains more sensitive to shifting US policy expectations than to the ECB’s predictable stance. While the narrowed interest rate differential offers near-term support, the technical structure appears bearish. A decisive break below the current consolidation range could trigger a renewed move towards the 1.1650–1.1645 support zone.

Disclaimer:

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

By RoboForex Analytical Department

The EUR/USD pair declined to around 1.1700 after the European Central Bank (ECB) left key interest rates unchanged, a widely anticipated decision that provided little fresh directional impetus for the single currency.

As expected, the main refinancing rate was held at 2.15%, with the deposit facility rate unchanged at 2.0%. ECB officials reiterated their commitment to a meeting-by-meeting, data-dependent approach.

During the subsequent press conference, President Christine Lagarde stated that policymakers did not discuss either a rate hike or a cut at this juncture. She emphasised that the ECB does not have a pre-set path for interest rates and, given the prevailing high uncertainty, cannot provide forward guidance on future policy moves.

In parallel, the central bank released its latest quarterly economic projections. Growth forecasts were revised upwards to 1.4% for 2025, 1.2% for 2026, and 1.4% for 2027. The inflation outlook for 2026 was also adjusted higher, primarily driven by persistent price pressures in the services sector.

Technical Analysis: EUR/USD

H4 Chart:

On the H4 chart, the pair completed a corrective rebound to 1.1760 and is now forming a downward impulse targeting 1.1706. A break below this level is anticipated, which would set the next local bearish target at 1.1640.

This scenario is technically confirmed by the MACD indicator. Its signal line is positioned above zero but is pointing sharply downwards, reflecting sustained bearish momentum and the potential for a further extension of the downtrend.

H1 Chart:

On the H1 chart, the market has finished a first decline to 1.1705, followed by a correction to 1.1755. A second downward impulse towards 1.1705 is currently developing. A clear break below this support would signal the potential for a third wave of decline, targeting the 1.1645 level as a local objective.

This outlook is supported by the Stochastic oscillator, whose signal line is below the 50 level and trending firmly downwards.

Conclusion

The euro remains range-bound following a largely uneventful ECB meeting, with the central bank’s cautious, data-dependent stance offering little support. The technical structure points to further downside risk, with a break below immediate support at 1.1705 likely to trigger a move towards the 1.1640 area.

Disclaimer:

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

By RoboForex Analytical Department

The British pound declined to around $1.3300 against the US dollar on Wednesday, as UK inflation undershot expectations and reinforced market convictions that the Bank of England (BoE) will cut interest rates on Thursday.

The annual Consumer Prices Index (CPI) inflation rate slowed to 3.2% in November, missing forecasts of 3.5% and falling below the central bank’s projection of 3.4%. This followed labour market data earlier in the week, which revealed unemployment rose to its highest level since 2021, while wage growth eased – albeit less sharply than anticipated.

The economic backdrop has weakened further following last week’s Gross Domestic Product (GDP) data, which confirmed the UK economy contracted for a second consecutive month in October. Given this deteriorating picture, the BoE is now widely expected to resume its monetary easing cycle, cutting the Bank Rate by 25 basis points to 3.75% – its lowest level since 2022. The central bank has held rates steady at its last two meetings in September and November.

Money markets have adjusted their expectations in response, now pricing in approximately 66 basis points of total easing by the end of 2026, up from around 58 basis points before the latest inflation report.

Technical Analysis: GBP/USD

H4 Chart:

On the H4 chart, the pair is developing a downward wave structure with a target at 1.3300. We expect this level to be tested today. Subsequently, a corrective rebound towards 1.3370 is likely. Once this correction is complete, the primary downtrend is anticipated to resume, targeting 1.3240, with potential for an extension towards 1.3175.

This bearish scenario is technically confirmed by the MACD indicator. Its signal line has exited the histogram zone and is near the zero mark, suggesting it will decline to new lows.

H1 Chart:

On the H1 chart, the market is forming a downward impulse targeting 1.3290 as its initial objective. Following this, a correction towards 1.3370 is likely. Upon completion of this corrective phase, the focus will shift to the potential continuation of the downtrend.

This outlook is supported by the Stochastic oscillator. Its signal line is below the 50 level and is pointing firmly downwards towards 20.

Conclusion

The pound remains under clear pressure ahead of Thursday’s pivotal BoE meeting, with soft inflation and growth data significantly raising the odds of a rate cut. The technical posture is bearish across timeframes, suggesting any near-term corrective bounce is likely to be sold into, paving the way for a test of lower support levels.

Disclaimer:

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.