This article is a rewritten version of “Pairs in Focus: 12th to 17th October 2025” originally published by DailyForex, authored by Peter Taberner. This analysis expands upon the original content, offering an in-depth look at major forex pairs while maintaining the core insights and market evaluations provided.
Weekly Forex Market Overview: October 12 to 17, 2025
The upcoming week in the forex market offers intriguing opportunities for traders as key economic data and technical setups begin to take shape across major currency pairs. With central banks maintaining higher-for-longer interest rate policies and inflation data poised to influence sentiment, forex participants should be well-positioned to take advantage of potential breakouts or retracements.
The U.S. dollar continues to hold its ground following strong economic performance indicators and hawkish commentary from Federal Reserve members. On the other hand, the euro and pound sterling have shown varying degrees of weakness due to mixed economic signals. Attention in the coming days will also focus on energy prices and geopolitical headlines, which may further influence currency movements.
Key Currency Pairs in Focus
EUR/USD
The euro continues to struggle against the U.S. dollar amid persistent economic softness in the Eurozone and reinforced strength in the greenback.
– The pair approached 1.0600 support last week but managed to stabilize above this key level.
– The short-term trend remains bearish, largely due to lackluster fundamentals out of Europe, including subdued manufacturing and services PMIs.
– Technical indicators such as the 100-day and 200-day simple moving averages remain above current price action, suggesting continued selling pressure.
– Any near-term upside may face resistance near the 1.0650 and 1.0700 levels.
Analysts are closely watching inflation readings out of the United States. An elevated Consumer Price Index (CPI) print could add pressure on EUR/USD, reinforcing a stronger dollar narrative. However, a downside surprise to inflation data might offer a short-lived reprieve for the euro, allowing the pair to test 1.0700 or higher.
GBP/USD
The British pound appears technically vulnerable against the U.S. dollar despite attempts to stage a rebound last week.
– Last week, the pair traded stable around 1.2240, forming a minor short-term base around that level.
– The Bank of England has recently adopted a more neutral tone, pulling back from earlier aggressive rate hikes. This shift has created uncertainty in the pair’s direction.
– Economic data from the UK remains light, meaning the cable will likely take cues from dollar strength as well as risk sentiment across equities and bonds.
– Resistance is seen at 1.2300 followed by 1.2380, while support remains firm near 1.2175.
From a technical perspective, GBP/USD needs to clear above 1.2300 with strong momentum to shift the outlook to positive in the short term. Otherwise, failure to defend 1.2200 could open the door to deeper retracements toward 1.2100 or lower.
USD/JPY
The Japanese yen continued to depreciate last week, with USD/JPY trading above the psychologically significant 150.00 mark. The divergence in central bank policy between the Federal Reserve and the Bank of Japan strongly favors continued bullish movement for this pair.
– The Bank of Japan remains committed to ultra-loose monetary policy. In contrast, the Federal Reserve maintains tighter policy settings.
– USD/JPY remains in striking distance of recent highs near 150.80.
– Market participants are also alert to potential intervention by the Japanese Ministry of Finance, which previously signaled discomfort with a weaker yen.
– A break above 151.00 could lead to a rapid move toward 152.00, though traders remain cautious of sudden liquidity shocks from intervention.
The pair’s trajectory this week will be sensitive to inflation and wage data in the U.S., with high prints potentially extending the trend higher. Traders should maintain a close eye
Explore this further here: USD/JPY trading.