Earlier this week the US Federal Reserve cut interest rates by 25 bps to a 3.50%–3.75% range, and though markets expected the move, Fed Chair Jerome Powell’s commentary hinted at an extended period without further hikes, dampening the greenback. This drove the dollar lower against the Swiss franc and other majors.

At the same time, the Swiss National Bank (SNB) kept its policy rate at 0%, and the Swiss franc drew strength on global risk aversion and safe-haven demand. As a result, USD/CHF retreated from levels near 0.8000 toward approximately 0.7950–0.7980 as CHF gains traction.

Despite this decline, there are foundational forces that could support a rebound in USD/CHF. Firstly, markets are now pricing a potential pause in easing after the recent Fed cut, which could lend support to the dollar if upcoming US data surprises to the upside. Secondly, the SNB’s commitment to holding the policy rate through 2026 suggests limited downward pressure from Swiss monetary policy alone, and at times the franc can weaken if the global market shifts back towards risk assets.

Investor sentiment toward USD/CHF remains cautious but not uniformly bearish. The broad dollar weakness of recent days has encouraged CHF strength, especially given the franc’s safe-haven status. However, sentiment may be shifting slightly as markets absorb the full impact of the Fed decision and consider that the cycle of consecutive cuts may be nearing a pause, if not a bottom. This dynamic tends to create short-term rebounds in the dollar when data show resilience, or when risk sentiment improves. With the franc’s safe-haven status potentially losing some immediate appeal amidst easing expectations for further rate cuts, USD/CHF could find demand at support. On short timeframes, traders are watching the 0.7950–0.7980 zone; if this holds and USD buyers step in, sentiment could flip toward cautious bullishness, especially into intraday dips.

USD/CHF price is currently trading near the lower region of the intra-day range. Recent candlesticks have probed below the 0.8000 psychological level, with daily trading data showing the rate has fluctuated between approximately 0.7924 and 0.8002. This suggests the market is finding interest around the lower Bollinger band of the short-term volatility envelope. The mid-band often lies near 0.7980–0.7990, and if price finds support around this area and rejects lower levels, a move back toward the mid or upper band becomes feasible.

Under Ichimoku (9,26,52) rules on M15, price trading near or slightly below the Kijun-sen and Tenkan-sen can indicate a compressed, oversold dynamic where mean reversion is likely once downward momentum hits exhaustion. If price then crosses above the Tenkan, a short-term BUY bias is confirmed. Stochastic (5,3,3) on M15 will be crucial: a bullish crossover from the oversold region (below ~20) signals a return of short-term buying momentum. A confluence of rejected lower wicks, a bullish stochastic trigger, and price stabilising above the lower Bollinger band strengthens the case for a reversal.

Entry: 0.7960–0.7970

Take Profit: 0.8015

Stop Loss: 0.7920

GBP/USD recently climbed toward 1.3400+ on the back of broad USD weakness following the Federal Reserve’s December rate cut and softer guidance, which initially pressured the greenback lower. However, price action appears to be stalling just under psychological resistance after several attempts to clear higher levels. Markets are now heavily focused on UK growth indicators and speculation around the BoE’s next move, with a Reuters poll showing a BoE rate cut widely expected at their upcoming meeting as inflation eases and economic growth slows.

Meanwhile the US dollar, though weaker post-Fed, may regain traction if macro data surprises to the upside or if risk sentiment shifts back toward safe-haven demand. Recent trading ranges show GBP/USD dancing around 1.3350 – 1.3439.The combination of an impending BoE cut and a potentially resilient USD sets a context where sterling’s recent gains may be retraced rather than extended.

Investor sentiment toward GBP/USD is mixed and leaning cautious. Although the pound has recently strengthened and hit multi-week highs, analysts and forecasts point to mounting UK economic concerns particularly slowing labour data, weak growth signals, and the looming probability of BoE easing.

This has weakened longer-term bullish conviction and increased scrutiny on the pair’s ability to sustain higher levels. Meanwhile, the recent Fed rate cut, although dovish in headline terms, was accompanied by commentary hinting at a more data-dependent outlook, which could support the USD if upcoming US data surprises positively.

Furthermore, nearly half of UK firms report high GBP volatility impacting operations, which reflects broader market discomfort with sterling’s rally and may contribute to bearish positioning.

In this environment, short-term traders may treat current peaks as corrective, positioning more aggressively on breaks back down rather than chasing further upside.

GBP/USD appears to be running into resistance near the upper Bollinger band after a series of marginal rallies into the 1.3400–1.3430 zone. Price failing to consistently close above this upper band suggests that bulls may be struggling to sustain momentum, with potential for a mean reversion back toward the mid-band around the 1.3360–1.3370 area. Ichimoku (9,26,52) on M15 would likely reflect price approaching or slightly above the Kumo cloud with Tenkan-sen and Kijun-sen flattening, indicating a loss of short-term bullish acceleration and a setup where downward pressure could emerge if price crosses back below those lines. A Stochastic (5,3,3) reading that has been in overbought territory or showing a bearish crossover near resistance would further confirm weakening upward momentum and increase the probability of a short-term dip. Together, these signals on the M15 chart imply that a push lower toward support zones is a technically reasonable expectation if bearish confirmation appears near current levels.

Entry: 1.3395

Take Profit: 1.3320

Stop Loss: 1.3445

Following Governor Ueda’s deliberately ambiguous guidance on 9 December, USDJPY has declined for a third consecutive session.

The Reuters poll conducted 2–9 December shows that most economists expect the Bank of Japan (BoJ) to raise its policy rate by 25 bp to 0.75% at the December meeting and to lift borrowing costs to at least 1% by end-September 2026.

According to sources, the BoJ is set to deliver its first rate hike since January at the December meeting. The government led by Prime Minister Sanae Takaichi is expected to tolerate the move, given upside inflation risks and a weak yen. 90% of economists surveyed (63 of 70) now forecast that the BoJ will raise the short-term policy rate from 0.50% to 0.75% next week, a sharp increase from 53% in last month’s poll. Just over two-thirds of respondents (37 of 54) expect the policy rate to reach at least 1.00% by end-September 2026.

Scepticism that the BoJ will deliver a 1.00% policy rate—or anything higher—is containing JPY appreciation. Despite recent BoJ guidance pointing to a December hike, upside pressure on the yen has remained modest and USDJPY is still trading above 155.00.

Until the Bank issues a decisively hawkish signal and commits to pushing the real policy rate further into positive territory, investors are unlikely to build meaningful long-JPY exposure.

An intraday break below the 156.00 support shelf opens the door to a deeper pullback. Daily oscillators, however, are still in bullish territory, so initial demand is expected in the 155.00–154.68 demand zone, which is the lower bound of the recent range. A daily close below 154.35 would flip the short-term bias to bearish.

Conversely, a sustained bullish rebound in USDJPY through the 156.00 handle would likely lift the spot price toward the 156.60–156.65 supply zone and ultimately to the 157.00 area—the two-week high printed on Tuesday. Follow-through buying should then pave the way for a further extension higher.

Trade Direction: Buy

Entry Price: 155.20

Target Price: 160.82

Stop Loss: 153.60

Valid Until: 27 December, 2025, 23:55:00

Support: 155.15/154.67/154.33

Resistance Levels: 156.19/156.95/157.91

During Thursday’s European session, gold rebounded moderately after touching around 4,204, but overall remained within a downward trend. The US dollar was supported by dip-buying and partially recovered the losses seen after Wednesday’s Fed decision, although it continued to hover near its lowest level since October 24. The dollar’s stabilization did not help gold extend its upward move or refresh its weekly high.

As widely expected, the Fed lowered the federal funds target range by 25 basis points at Wednesday’s policy meeting and indicated that only one additional rate cut is expected in 2026. However, after Chair Powell delivered relatively dovish signals, some investors continued to bet on the possibility of two additional cuts in 2026.

Powell stated at the press conference that the US labor market faces significant downside risks and that the Fed has no intention of using policy to further restrain job growth. This remark pushed the dollar to a fresh seven-week low and drove gold to a new weekly high on Thursday.

However, Powell refrained from providing guidance on the timing of the next rate cut and emphasized that the path for further easing would be more challenging. Additionally, two hawkish committee members opposed the current rate cut, which heightened concerns about next year’s easing pace and put pressure on non-yielding gold.

Meanwhile, improved risk appetite also prompted some safe-haven money to exit precious metals. However, the slow progress in Russia–Ukraine ceasefire negotiations means related geopolitical risks remain, which may discourage traders from building large short positions and could cushion gold prices.

Gold prices retreated from the upper boundary of the two-week trading range on Thursday, reminding bullish traders to remain cautious. It also suggests that the tug-of-war between bulls and bears will continue to dominate trading before the weekend. Oscillators on the daily chart indicate that if the price falls further below the 4,200 level, it may offer buying opportunities and find solid support near the lower boundary of the triangle consolidation. However, a sustained break below this area could open the door to additional downside.

Trade Direction: Buy

Entry Price: 4195

Target Price: 4350

Stop Loss: 4150

Valid Until: December 27, 2025 23:55:00

Support: 4192 / 4185 / 4170

Resistance: 4225 / 4240 / 4259

BoE rate-cut expectations are weighing on GBPUSD. With CPI momentum easing, the market now prices an about 88% probability of a 25 bp reduction next week.

Meanwhile, Chancellor Rachel Reeves on 10 Dec condemned the pre-budget leak of key tax measures as "damaging". An 13 Nov FT report that she would shelve a planned income-tax rise moved Gilt yields sharply higher. Testifying to the Treasury Select Committee, Reeves said the disclosure was not from an authorised briefing and called the story "partial and inaccurate". Opposition MPs accuse her of talking down the economy to justify tax rises needed to fund higher welfare spending pledged by the Labour party. Reeves rejected claims she misrepresented the OBR's downward revision to productivity, noting that while higher inflation boosts nominal receipts, it erodes the real purchasing power of those revenues.

Early Thursday, the FOMC cut the target range by 25 bp to 3.50%-3.75%, in line with consensus. The DXY sold off on the release, sending GBPUSD to the 1.3390 handle. This marks the third 2024 easing, adopted 9–3.

Dissent split two-ways: two voters favored holding the rate, one preferred a 50 bp cut, exposing a sharp internal divide on the outlook and policy path.

The post-meeting statement notes that activity is "expanding at a solid pace" but concedes job gains have slowed and the unemployment rate has moved higher. At the same time, the prior characterization of the labor market as "strong" or the jobless rate as "low" was dropped. Inflation has eased from its early-year highs but remains "somewhat elevated." Uncertainty around the outlook has risen, with downside risks to employment having increased.

To keep reserve balances ample, the FOMC announced a short-dated Treasury purchase program, set to begin 12 Dec at an initial pace of around $40 bn. The Committee reiterated that any future adjustments will be data-dependent, conditional on the evolving outlook and balance of risks, with no preset course.

At the post-meeting press conference, Chair Powell elaborated that the 175 bp of cuts since September have brought the policy rate into the broad neutral range, giving the FOMC a "watch-and-see" vantage point. He stressed that "rate hikes are in no one's baseline," dispelling fears of an imminent policy reversal.

On the 4-hour chart, GBPUSD has printed a record high, yet the MACD histogram is shrinking and RSI peaks are successively lower, which is a classic bearish divergence that flags a correction. Bollinger bands are widening with price riding the upper band. the SMA stack is fanning upward, so the macro up-trend remains intact. Immediate resistance sits at the psychological 1.40 handle and the prior swing-high at 1.347. RSI reads 63, still in bullish territory, favouring buy-the-dip tactics.

On the weekly chart, price is compressing beneath the Bollinger mid-line. The MACD fast-slow lines has retreat to the zero-axis but has not yet crossed bullish. A golden-cross there would open a high-probability move toward the upper Bollinger band and the previous high. Failure would send price back to the EMA200. RSI is 54 and rolling over, signalling neutral-to-cautious sentiment. Strategy. Therefore, traders are advised to look for a short-term fade lower, then flip long on confirmation.

Trade Direction: Sell

Entry Price: 1.337

Target Price: 1.29

Stop Loss: 1.35

Support: 1.3/1.29/1.28

Resistance Levels: 1.34/1.342/1.35

At today's meeting, the Federal Reserve lowered the federal funds rate by 25 basis points to a range of 3.50%–3.75%, and simultaneously announced the resumption of technical purchases of short-term Treasury securities to manage year-end liquidity. Following this, the Fed's statement and dot plot generally conveyed a message of "rate cuts proceeding cautiously, with possible pauses in the future." As a result, the market initially sold off the dollar in the short term, but quickly began to digest the implication that "this rate cut does not signal long-term easing." Consequently, USD/JPY showed an initial dip followed by stabilization and even a renewed upside push. The impact of this decision is not one-dimensional. While the 25-basis-point rate cut did reduce the immediate yield advantage of the dollar on a nominal level, more importantly, the Fed did not commit to further rapid cuts in its statement or in the Chair's remarks. Moreover, the updated dot plot indicates that the tightening cycle has not come to a complete end. Therefore, markets have priced in the probability of "limited rate cuts and potential pause going forward." In other words, while short-term rates were lowered, medium- and short-term yields did not collapse. After an initial pullback, the dollar may find support due to a "slower-than-expected pace of rate cuts."

Meanwhile, Japan's interest rate policy has not responded in kind—if the Bank of Japan maintains a relatively accommodative stance and the yield differential between Japanese and U.S. bonds remains intact, the fundamental bullish logic for USD/JPY stays valid. Additionally, the Fed's move to resume purchases of short-term Treasuries helps ease technical tensions in money markets, which can suppress extreme volatility toward year-end and provide a practical window for initiating long positions on pullbacks.

Based on the daily chart, USD/JPY has shown a clear uptrend recently. Despite yesterday's bearish close, as of the European session today, the exchange rate is still oscillating around the 23.6% Fibonacci retracement level at 155.91. If today's closing price holds above 155.91, the likelihood of USD/JPY continuing its earlier uptrend will increase significantly.

Simultaneously, a long lower shadow bullish candle has formed on the 4-hour chart, creating a bullish engulfing pattern, further reinforcing the pair's upward momentum.

Trading direction: Buy

Entry price: 156.00

Target price: 160.10

Stop loss: 155.40

Valid Until: December 25, 2025, 23:00:00

Support: 155.48/154.34

Resistance: 157.89/160.00