Market participants may be waiting to see how much further the pound can rise against the U.S. dollar

Market participants may be waiting to see how much further the pound can rise after rebounding against the U.S. dollar

12.05.2025

Last weekend, the U.S. dollar fell against the euro.The EUR/USD pair rebounded from 1.1197 to 1.1292. On the hourly chart, the price has moved from below the 20-period moving average (MA) to above it. On the 4-hour chart, the 200-period exponential moving average (EMA) is acting as a support level, and the candlesticks have reversed. On the daily chart, the pair is currently in the process of recovering after breaking below the 20-period MA, which had previously provided support. We will be watching price movements during European trading hours to see if the US dollar continues to weaken.

Among European currencies, the pound strengthened, much like the Japanese yen. The GBP/USD pair rebounded from 1.3212 to 1.3321. On the hourly chart, the price moved from the -2σ to the +3σ Bollinger Band. On the 4-hour chart, a return to the 20-period moving average (MA) is evident, while on the daily chart, the 20-MA is acting as support, with a rebound occurring just below it. We will be watching closely to see if the pound can maintain its momentum against the U.S. dollar.

Today’s economic indicators include Japan’s balance of payments at 8:50, the Japan Economic Watchers Survey at 14:00, remarks by BOE Deputy Governor Lombardelli at 17:00, andremarks by MPC member Green, at 21:50 remarks by MPC member Mann, at 23:25 remarks by Fed Governor Kugler, at 01:00 remarks by MPC member Taylor, and at 03:00 the U.S. budget balance. We will cautiously monitor the upside potential for the pound, which has rebounded against the U.S. dollar.