The euro faces pressure from weak growth signals in the bloc while central bank officials highlight inflation risks. The pound remains under strain from soft data and fiscal concerns, with sentiment tied to upcoming Bank of England policy signals. The yen gains modest support as investors reassess US policy direction and political tensions, though its broader outlook is still shaped by divergence between the Fed and Bank of Japan. Gold continues to attract strong demand as a safe haven, boosted by expectations of easier US policy and heightened geopolitical risks, extending its record-breaking rally and underscoring its role as a key hedge against uncertainty.
🇪🇺/🇺🇸 EUR/USD Outlook – Euro vs U.S. Dollar
Recent Price Action
- Euro held above 1.17 and climbed toward 1.18, supported by cautious optimism in European markets.
- Weak PMI data from the eurozone manufacturing sector, slipping below the 50 mark, limited gains and highlighted downside risks.
Macroeconomic Drivers
- Eurozone PMI contraction signals weaker industrial momentum, restraining bullish sentiment.
- ECB stance: Policymakers suggested the rate-cut cycle could soon end, citing inflation risks in services, tariffs, food, and fiscal policy.
- Fed stance: After cutting rates for the first time since December, another 50 bps cut is anticipated this year, which could weigh on the dollar if Powell confirms dovishness.
Key Events
- US PMI data and Powell’s speech remain decisive—better-than-expected results support USD strength, weak outcomes may fuel EUR upside.
- Eurozone inflation and employment indicators will also guide medium-term positioning.
Technical Levels
- Support: 1.1790, 1.1758, 1.1704
- Resistance: 1.1809, 1.1825, 1.1858
Outlook
- Base case: Range trading between 1.1750–1.1850, with slight bullish bias if Fed rhetoric softens.
- Alternative: A confirmed break below 1.1704 could trigger renewed downside toward 1.1650.
🇬🇧/🇺🇸 GBP/USD Outlook – British Pound vs U.S. Dollar
Recent Price Action
- The pound traded near 1.35 after weaker UK PMI data weighed on sentiment.
- Despite recent strength, the currency remains under pressure from domestic fiscal concerns and weaker growth outlook.
Macroeconomic Drivers
- UK PMI data showed contraction in manufacturing and a slowdown in services, heightening recession concerns.
- Inflation remains elevated, straining household spending and increasing policy dilemmas for the Bank of England.
- Fiscal position: Higher-than-expected government borrowing adds pressure ahead of the autumn budget.
- Fed policy and Powell’s upcoming speech remain influential for GBP/USD, especially if dovish tones emerge.
Key Events
- Market focus on upcoming BoE speeches and UK inflation updates.
- US PMI releases and Fed guidance may tilt GBP/USD direction in the short term.
Technical Levels
- Support: 1.3493, 1.3450, 1.3398
- Resistance: 1.3530, 1.3585, 1.3635, 1.3713
Outlook
- Base case: Mild downside bias as GBP struggles with domestic economic headwinds, holding between 1.3450–1.3550.
- Alternative: A breakout above 1.3635 may revive bullish momentum, opening the way toward 1.3700+.
🇺🇸/🇯🇵 USD/JPY Outlook – U.S. Dollar vs Japanese Yen
Recent Price Action
- Yen strengthened back toward 147.5 after a rebound from recent lows, supported by weaker dollar sentiment.
- Despite medium-term upward momentum in USD/JPY, recent volatility reflects shifting Fed policy expectations.
Macroeconomic Drivers
- Fed policy: Dovish signals could weigh heavily on USD/JPY, as markets anticipate further rate cuts.
- BoJ stance: The central bank held rates steady at 0.5%, highlighting risks tied to global trade but maintaining an accommodative outlook.
- Geopolitical factors: US political tensions, including funding concerns and risk of government shutdown, added pressure to the dollar.
Key Events
- US PMI data and Powell’s remarks remain immediate drivers.
- BoJ commentary on inflation and growth will be monitored for any policy shift hints.
Technical Levels
- Support: 147.46, 147.14, 146.86
- Resistance: 147.80, 148.76, 148.93
Outlook
- Base case: Range-bound between 147.0–148.5, with bias depending on Fed tone.
- Alternative: A break below 146.86 would signal downside continuation, while a surge above 148.76 would confirm bullish momentum.
🌕 Gold (XAU/USD) Outlook – Gold vs U.S. Dollar
Recent Price Action
- Gold surged to record highs above $3,780, supported by Fed rate-cut expectations and geopolitical risk demand.
- The rally has been continuous since early 2016, with the latest breakout showing no signs of exhaustion.
Macroeconomic Drivers
- Fed policy: Anticipated additional rate cuts this year lower real yields, boosting gold’s appeal.
- Geopolitical risks: Escalating Russia–Ukraine conflict, Middle East tensions, and global uncertainty sustain safe-haven demand.
- Central bank demand: Strong global buying of gold reserves provides structural support.
Historical Context
- Previous gold bull runs (1970s, 2000s) suggest the current rally could extend further given a mix of inflation concerns, monetary easing, and geopolitical crises.
- Current rally (2016–2025) has seen a 257% rise, potentially still in mid-cycle compared to past bull rallies.
Technical Levels
- Support: 3700, 3672, 3637, 3615, 3600
- Resistance: 3750, 3800
Outlook
- Base case: Continued bullish momentum, with upside potential toward 3800–3850.
- Alternative: Pullbacks possible, but only a break below 3636 would threaten the broader uptrend.
📊 Summary Table: As of September 24, 2025
| Asset | Bias | Key Drivers | Support Levels | Resistance Levels |
|---|---|---|---|---|
| 🇪🇺 EUR/USD | Slight Bullish | ECB cautious stance, Fed dovish risk, PMI data | 1.1790, 1.1758, 1.1704 | 1.1809, 1.1825, 1.1858 |
| 🇬🇧 GBP/USD | Mild Bearish | Weak UK PMI, fiscal risks, BoE policy outlook | 1.3493, 1.3450, 1.3398 | 1.3530, 1.3585, 1.3635, 1.3713 |
| 🇯🇵 USD/JPY | Neutral / Range | Fed cuts vs. BoJ steady policy, US political risks | 147.46, 147.14, 146.86 | 147.80, 148.76, 148.93 |
| 🪙 XAU/USD | Strong Bullish | Fed easing, geopolitical risks, safe-haven demand | 3700, 3672, 3637, 3615, 3600 | 3750, 3800 |
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