Date: 15th October 2025.
Federal Reserve Turns Dovish. BOE to Follow?
GBPUSD - Technical Analysis
Despite the Pound’s decline on Tuesday, the currency looks to rebound today due to the weakening of the US Dollar. The GBPUSD was trading at its lowest price since August 1st before rebounding due to the Federal Reserve’s comments.
Despite the recent bullish price movement, the exchange rate has risen to a resistance level which has triggered a decline in the past days. In addition to this, on a 2-hour timeframe the price remains level with the 75-period EMA and 100-period SMA. If we switch over to a 3-minute timeframe, the price of the GBPUSD trades above the 200-period SMA but is failing to pass the swing high from earlier in the morning.
GBPUSD 2-Hour Chart
For this reason, the GBPUSD is close to obtaining bullish signals from technical analysis but is still witnessing conflicting data. This week the performance of the Pound against the whole currency market has been neutral. Currently the GBP index is trading 0.20% lower. The main cause for concern for the British Pound is the lack of economic growth and the recent poor employment data which we can see here.
USDJPY - Technical Analysis
The USDJPY is gaining bullish momentum as the US session edges closer, but remains lower than the day’s open price. This is due to the Yen’s strong performance during this morning’s Asian session.
Even with the slight rise in recent hours, the USDJPY continues to form lower highs and lower lows. In addition to this, the USDJPY is trading below the main Moving Averages on the 2-hour chart and below 50.00 on the RSI. This provides a slight bearish bias. Bearish signals from price action are likely to strengthen when the price falls below 151.186. The next support level can be seen at 149.293, while the resistance level can be seen at 153.235.
Traders should also note that according to experts, a price above 150.00 increases the possibility of the Japanese Federal Government intervention. The government previously intervened in April 2024.
Bank of England
Both the Bank of England and the Federal Reserve have taken a dovish tone over the past 24-hours due to concerns over growth and employment.
Bank of England committee member, Alan Taylor, advises that the UK economy is at a higher risk of a ‘bumpy landing’. Economists expect a slightly more dovish Central Bank. Mr Alan Taylor also tells journalists that the downside risk to the economy from rising unemployment and weak demand is greater than wage-led inflation.
Federal Reserve
One of the main price drivers pushing the US Dollar lower is the latest comments from the Federal Reserve Chairman. The Fed Chairman advises that the economy remains resilient, but employment shows signs of pressure and weakness. Due to this, he supports further rate cuts but will remain data-dependent.
The US Dollar is the worst-performing currency due to pressure from the Fed’s recent dovish comments. Possibilities for two rate cuts for 2025 have risen from 79% to 95%.
Key Takeaways:
GBPUSD rebounded after Fed comments but faces resistance and conflicting technical signals near key moving averages.
USDJPY shows bearish bias with lower highs/lows and remains below key averages; risk of government intervention above 150.00.
Bank of England adopts a dovish stance amid weak growth and rising unemployment concerns.
The Federal Reserve signals potential rate cuts in 2025, weakening the US Dollar further.
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Please note that times displayed based on local time zone and are from time of writing this report.
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Michalis Efthymiou
HFMarkets
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