**Pairs in Focus: August 3rd to 8th, 2025 – Forex Technical Outlook**
*By: Adam Lemon (original article inspiration from DailyForex.com)*
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The first week of August 2025 introduces a trading landscape shaped by divergent central bank policies, inflation expectations, and a cautiously optimistic market outlook. As summer trading thins liquidity, volatility in the major currency pairs and selective crosses could offer unique trading opportunities and challenges. With the Federal Reserve maintaining a hawkish stance, the European Central Bank facing persistent economic headwinds, and risk-on sentiment waxing and waning with shifting data prints, traders must pay particular attention to key levels and trend-defining signals.
Below is a detailed technical outlook for the major currency pairs and cross-pairs, distilled from market conditions for the week ahead. This analysis is based on the original work by Adam Lemon at DailyForex.com and aims to guide traders with actionable insights.
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### 1. **EUR/USD: Struggling in a Bearish Channel**
**Overview:**
The euro continues to struggle as market participants remain unconvinced about the region’s growth trajectory while the Federal Reserve’s resolute messaging supports the US dollar. Persistent inflation in the US and lackluster numbers from the Eurozone keep the pair within a descending channel.
**Key Technical Points:**
– **Resistance Levels:** 1.0830, 1.0915
– **Support Levels:** 1.0720, 1.0650
– **Trend:** Downtrend, with occasional corrective rallies limited by strong overhead supply.
– **Momentum Indicators:** RSI on the daily chart remains below 50, confirming bearish sentiment; MACD shows negative divergence.
**Trading Ideas:**
– Short EUR/USD on rallies toward resistance, especially near 1.0830, with stops above 1.0915.
– Break below 1.0720 could trigger a fresh leg lower toward 1.0650.
– Watch for reversal signs if the pair closes above 1.0915 on a daily basis.
**Fundamental Focus:**
– Monitor ECB communications for any dovish turns.
– Key US nonfarm payrolls (NFP) and services PMI could inject further USD volatility.
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### 2. **GBP/USD: Sideways Action, Awaiting Direction**
**Overview:**
Sterling has outperformed in relative terms, but the lack of aggressive hikes from the Bank of England restrains GBP/USD momentum. With no clear direction, the pair hovers inside a range, offering range trading opportunities.
**Key Technical Points:**
– **Resistance Levels:** 1.2820, 1.2950
– **Support Levels:** 1.2650, 1.2580
– **Trend:** Sideways, coiling just below the 200-day moving average; lack of strong conviction in either direction.
– **Momentum Indicators:** Stochastics mid-range; neutral MACD.
**Trading Ideas:**
– Range trade between 1.2650 and 1.2820, using tight stops.
– In case of a breakout above 1.2950, target 1.3020.
– If 1.2580 fails, watch for quick moves down to 1.2500.
**Fundamental Focus:**
– UK GDP figures and BoE governor commentary will be crucial market movers.
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### 3. **USD/JPY: Yield Momentum Keeps Bulls in Charge**
**Overview:**
The yen continues to weaken against the dollar, driven by yield differentials and dovish policy from the Bank of Japan (BoJ). The pair remains in a robust uptrend, with risk of BoJ intervention if moves accelerate.
**Key Technical Points:**
– **Resistance Levels:** 163.80, 165.30
– **Support Levels:** 161.20, 160.00
– **Trend:** Strong uptrend, with price action
Read more on GBP/USD trading.