Title: Forex Technical Analysis: Key Currency Pairs to Watch Between July 20–26, 2025
Adapted from the original article by DailyForex.com
The week of July 20 to 26, 2025, presents key developments across several major currencies. From central bank policies to important technical indicators, this analysis provides insights into the likely movements of critical currency pairs. Traders and investors will need to navigate ongoing macroeconomic shifts, continued geopolitical influences, and market sentiment as they monitor price action and plan their trades.
This breakdown provides a comprehensive technical outlook on major forex pairs, including EUR/USD, GBP/USD, USD/JPY, and more. It also includes trader sentiment data and highlights emerging patterns that may inform short- to medium-term trading strategies.
EUR/USD Technical Outlook: Testing Key Resistance
After sustaining a bullish rally over previous weeks, the EUR/USD currency pair appears to be entering a consolidation phase. The pair has managed to maintain its hold above the key psychological level of 1.1000 and is now facing significant resistance near 1.1150.
Key Technical Insights:
– The 50-day Simple Moving Average (SMA) served as strong support, with price action continuing to trend above both the 50-day and 200-day SMAs. This indicates underlying bullish momentum.
– A potential ascending triangle pattern points toward bullish continuation, with resistance seen at the 1.1150 to 1.1200 range.
– If the pair breaks and sustains above this zone, a move toward 1.1300 becomes increasingly likely in the medium term.
– On the downside, initial support lies at 1.1040, followed by more substantial demand near the 1.0970 region.
– The Relative Strength Index (RSI) remains in bullish territory but is approaching overbought levels, suggesting that consolidation could continue before fresh buying momentum emerges.
Fundamental Drivers:
– Expectations surrounding the European Central Bank’s (ECB) next policy moves will heavily influence near-term direction. Any dovish signals about rate adjustments could stall the rally.
– On the U.S. side, a shift toward neutral language from the Federal Reserve has reduced dollar strength, offering tailwinds for the euro.
Outlook: Neutral to Bullish
Traders should watch for a clear breakout above 1.1150 accompanied by volume and confirmation on higher timeframes. Until then, the pair may oscillate within a sideways range.
GBP/USD Technical Outlook: Bullish Breakout in Progress
The British pound has shown strength in recent sessions, with GBP/USD breaking out of its earlier consolidation pattern. The pair is climbing toward multi-month highs, bolstered by investor optimism and a weaker U.S. dollar.
Key Technical Insights:
– Price action has broken cleanly above the resistance trendline that formed over several weeks, suggesting a bullish breakout.
– GBP/USD is now advancing toward 1.3300, a level not seen since early 2024.
– Strong support now lies at 1.3100 and 1.3030.
– Momentum indicators like the RSI and MACD confirm bullish trends, with minimal signs of divergence at the moment.
– The Ichimoku Cloud shows the price well above the cloud, reinforcing bullish sentiment.
Fundamental Drivers:
– Improved GDP readings and declining inflation are supporting the Bank of England’s position, with traders interpreting this as less urgent need for further tightening.
– Brexit-related concerns have faded into the background, allowing fundamentals to drive price performance.
– Meanwhile, mixed data from the U.S. has introduced uncertainty around Fed tightening, weighing on the dollar broadly.
Outlook: Bullish
Traders should look for buying opportunities on dips, especially near 1.3100. Any sustained move above 1.3300 could open the door to a long-term target of 1.3500.
USD/JPY Technical Outlook: Correction Underway Amid Falling Yields
USD/JPY has pulled back from highs reached earlier
Read more on EUR/USD trading.