The following is a rewritten and expanded version of the article “Pairs in Focus (21st to 26th December 2025)” published by DailyForex. The analysis and commentary credit belongs to the original author at DailyForex.com. This adaptation adds further context and analysis while maintaining the original informational structure.
Forex Pairs in Focus: Market Insights and Technical Analysis for December 21–26, 2025
Author: DailyForex Analyst
Original Source: https://www.dailyforex.com/forex-technical-analysis/2025/12/pairs-in-focus-21th-to-26th-december-2025/238743
Overview
As Christmas approaches, financial markets typically enter a quieter phase characterized by lower liquidity and reduced volatility. However, specific forex pairs can still offer meaningful opportunities for traders who pay close attention to technical setups and macroeconomic developments. This week’s outlook focuses on several major and minor currency pairs, analyzing their current position and future potential from a technical and fundamental perspective.
The pairs under review for the trading days between December 21 and 26, 2025, include:
• EUR/USD
• USD/JPY
• GBP/USD
• USD/CAD
• AUD/USD
• NZD/USD
• USD/CHF
EUR/USD Technical and Sentiment Analysis
• The EUR/USD remains under pressure with a modestly bearish tone as price hovers near a key support level of 1.0890.
• A descending triangle pattern continues to develop on the 4-hour and daily charts, signaling potential continuation of the downtrend.
• Momentum indicators like the RSI hover around the midline (50), suggesting indecision in the short term.
• Traders should pay attention to the daily close: a conclusive break below 1.0890 could open the path toward the next support level near 1.0800.
• Fundamental factors influencing the euro include recent ECB rhetoric, which remains dovish amid slowing inflation expectations.
• In the U.S., continued strength in employment and inflation data supports the Federal Reserve’s hawkish posture.
Outlook: Bearish unless the 1.0890 level rebounds decisively. Sellers could target 1.0800 with stop-losses placed above 1.0960 for risk management.
USD/JPY Perspective
• The USD/JPY has shown renewed bullishness, bouncing sharply from the psychological support at 140.00.
• The pair is back above its 200-day moving average, confirming strength and reinforcing a medium-term bullish bias.
• The Bank of Japan’s dovishness stands in contrast with the Fed’s tighter monetary stance, supporting further upside.
• Technically, the uptrend resumes toward 144.50 and possibly 146.00 in coming sessions.
• Daily MACD and RSI readings are supportive of upward momentum, although RSI is near 70, indicating the pair may briefly consolidate.
Outlook: Bullish with buying opportunities on pullbacks toward 141.50, setting stops below 140.00 for a conservative risk-reward ratio.
GBP/USD Analysis
• The British pound is showing signs of exhaustion after strong bullish performance earlier this month.
• The cable faces resistance around 1.2770, a level that has held firm for several weeks.
• Any decisive move above could spark bullish continuation toward 1.2850, but repeated failures suggest consolidation or near-term weakness.
• From a fundamental standpoint, the Bank of England has become more data-dependent and cautious, weakening sterling’s bullish case.
• U.S. dollar strength could further suppress the pound if hawkish Fed narratives continue to dominate.
• The 1.2600 support remains pivotal; a break lower would challenge the 1.2520 level next.
Outlook: Neutral to slightly bearish. A failure to clear 1.2770 could lead to a short-term correction.
USD/CAD Forecast
Explore this further here: USD/JPY trading.