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Forex Analysis & Reviews: GBP/USD Overview for October 21: Inflation Will Complicate the Situation for Both the Fed and the Bank of England



The GBP/USD currency pair showed no meaningful movements on Monday. In this article, we focus on upcoming events that could (theoretically) influence the pair's direction. "Theoretically," because for the past three weeks, the market has been actively ignoring many factors that typically work against the U.S. dollar. Simply put, if the dollar had been falling these last three weeks, we would consider it entirely justified. However, the British pound, like the euro, remains stuck in a flat range on the daily timeframe. From its current levels, GBP/USD could still fall another 250 pips and stay within the bounds of this flat market. And once the flat range is over, a new trend will eventually follow. While the dollar could technically gain several hundred points in the medium term based on technical factors alone, it's unclear what fundamental reason might support it starting a full-scale uptrend. Two significant events this week will be the consumer inflation reports from both the United Kingdom and the United States. In both cases, an acceleration in prices is expected. However, the implications for the Bank of England and the Federal Reserve will differ. For the BoE, the pace of inflation is less critical. Inflation has been running above target for over a year now—almost double the official target—so it's becoming increasingly clear that the BoE is unlikely to lower interest rates any time soon. For the Fed, inflation is also not a key factor—at least not in the short term. The Fed is widely expected to cut rates twice more before the end of the year, as failure to do so could result in severe labor market strain. However, entering 2026, inflation will regain importance. Fed Chair Jerome Powell and most members of the FOMC have reiterated their commitment to both mandates—employment and price stability—stating clearly that persistently high inflation would make further policy easing unlikely. For now, the labor market takes priority, but once it stabilizes, inflation concerns will come to the forefront again.

Analysis are provided by InstaForex.

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Forex Analysis & Reviews: GBP/USD Overview for October 22. The Pound, Flat Market, and Possible Deviations/Manipulations



On Tuesday, the GBP/USD currency pair once again traded with low volatility and continued to drift lower. This isn't surprising, as the week has not yet delivered a single significant event or report that could motivate traders to become more active. There's little for the market to respond to. Many factors continue to be overlooked, U.S. economic data has been halved due to the government shutdown, and the daily chart clearly shows a flat market. In such an environment, expecting strong moves, meaningful signals, and profits becomes difficult. In yesterday's EUR/USD analysis, we discussed the flat formation. GBP/USD shows the same structure on the daily chart: since July 1, the pair has been trading between 1.3140 and 1.3780. That gives us a sideways range over 600 pips wide—but this is a daily timeframe, and the scale is appropriate. At the moment, the British pound has all the advantages on its side. If we were observing a continuation of the uptrend instead of the current flat, that scenario would seem entirely logical. Therefore, we believe that the market is simply preparing for the next trend—more specifically, a new leg of the 2025 bullish trend. However, it's worth emphasizing that flat markets rarely end quietly or easily. While the forex market is less prone to manipulation than cryptocurrencies, such activity still occurs here. In the ICT (Inner Circle Trader) trading theory, there's a concept known as "deviation." This refers to a false breakout—when the price appears to break a range boundary, triggering orders and pulling liquidity before sharply reversing. Retail traders believe the range has broken, only to be caught on the wrong side by market makers who intentionally move prices in the opposite direction to harvest liquidity. We consider it entirely possible that the current flat on the daily GBP/USD chart could conclude similarly. There are two clearly defined lows—August 1 and October 14. One of these may be falsely breached for liquidity purposes, after which the pound could begin its new ascent. Such liquidity grabs are not guaranteed, but they are common enough to plan for. At this time, however, there is no clear motivation in the market to push the pair higher. By all indications, the sideways movement continues. There will be a few key events this week for both the dollar and the pound, but these are unlikely to be strong enough to break the flat structure. Historically, flat markets tend to end suddenly. The market may ignore important headlines for days or weeks, only to start a major move seemingly "out of nowhere." Therefore, readiness is critical.

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Forex Analysis & Reviews: EUR/USD Overview: October 23. Is the Dollar Really Growing on a U.S.–China Deal That Doesn't Exist?



The EUR/USD currency pair traded lower again on Wednesday, for no apparent reason. While the British pound fell sharply that morning due to a weaker-than-expected UK inflation report (which significantly increased the likelihood of a Bank of England rate cut later this year), this report had no direct relevance to the euro. Indeed, GBP could have pulled EUR down with it, as the two currencies are moderately correlated. But this explanation feels more like an excuse—and lately, the market appears to be full of such "excuses." Let us explain what we mean. Many are now questioning why the U.S. dollar has been strengthening over recent weeks. We've been saying for three weeks that the market is trading in a flat range on the daily chart and that recent moves often lack logic. Yet most analysts remain eager to offer fundamental explanations for the dollar's rally. The most widespread theory right now? Easing tensions between the U.S. and China, following U.S. President Donald Trump's more conciliatory remarks. Recall that Trump first threatened to raise tariffs on China by "only" 100% starting on November 1. He then stated repeatedly that he "believes in a successful and fair deal with Beijing." Of course, by "successful," Trump primarily means beneficial for the U.S., not necessarily for China. However, China is far from passive and has recently started pushing back. As of December 1, the country plans to implement new export regulations on rare earth metals. While details remain unclear, the reaction from Washington suggests that these restrictions will be real and impactful—not just for the U.S., but for all high-tech economies reliant on Chinese sourcing.

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Forex Analysis & Reviews: EUR/USD Forecast for October 24, 2025



The euro is recovering — slowly but steadily — after a three-day decline between October 17 and 21. A key development would be a daily close above the MACD line at 1.1638, which could provide upward momentum and accelerate the current recovery.

With the Federal Reserve expected to cut interest rates next week — currently priced in with a 97% probability — market optimism is justified. The short-term upside target remains at 1.1779, the peak recorded on both September 9 and October 1. If the price successfully closes above the MACD line, the Marlin oscillator could move into positive territory, reinforcing the bullish outlook.



On the four-hour chart, the price has already settled above the MACD line. Meanwhile, the Marlin oscillator lags slightly behind and remains in negative territory. Therefore, today may be spent working off this lag and pushing the oscillator higher — suggesting the day may feature uneven or choppy growth. A more defined acceleration in upward momentum could begin on Monday.

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Forex Analysis & Reviews: Trading Recommendations and Analysis for EUR/USD on October 27. Statistics Did Not Awaken the Market

Analysis of EUR/USD 5M



The EUR/USD currency pair traded very little on Friday. At this time, traders should focus not on macroeconomic reports or fundamental backgrounds, but on the volatility indicator and the sideways trend on the daily timeframe. The volatility indicator shows very few trades in the market now, with practically no movement. Therefore, making gains with any trading signals or macroeconomic events is extremely difficult. The sideways trend on the daily timeframe demonstrates illogical movements within a sideways channel. Thus, the fundamentals and macroeconomics do not influence the current movements of the pair. On Friday, at least four interesting reports were released in the Eurozone, and four in the United States. Eight reports in total, and the market traded with a volatility of around 40 pips. The European reports could have provided significant support to the euro, as all four business activity indices came in above forecasts, while the American reports could have weighed on the euro, as two of the most important reports were worse than expected. However, by the end of the day, the European currency had only appreciated by 10 pips. In recent weeks, numerous factors could have triggered a rise in the pair, yet all were ignored. On the 5-minute timeframe, the movements were such that identifying trading signals made little sense. Throughout the day, the price traded between the 1.1604 level and the Kijun-sen line, which we set at 1.1653, as the sideways trend is now visible on the hourly timeframe as well. Even if we do not take into account the new value of the Kijun-sen line, the range just above is 1.1657-1.1666. Trading between levels and lines with a distance of only 10 pips was impractical.


The latest COT report is dated September 23. Since then, no further COT reports have been published due to the U.S. government shutdown. The illustration above clearly shows that the net position of non-commercial traders has long been "bullish," with bears only managing to slip into a position of superiority at the end of 2024, but they quickly lost it again. Since Trump took office for the second time, the dollar has been on a downward trend. While we cannot say with 100% certainty that the decline of the U.S. currency will continue, current developments around the world suggest this outcome. We still do not see any fundamental factors supporting the strengthening of the euro, but there are enough factors for the U.S. dollar to decline. The global downtrend persists, but what significance does it have given where prices have moved over the past 17 years? Once Trump concludes his trade wars, the dollar could begin to strengthen, but recent events have shown that the conflict will continue in one form or another. The possible loss of the Federal Reserve's independence is another strong pressure factor on the U.S. currency. The indicator's red and blue lines continue to signal a "bullish" trend. During the last reporting week, the number of longs in the "Non-commercial" group decreased by 800, while shorts increased by 2,600. Consequently, the net position decreased by 3,400 contracts over the week. However, this data is already outdated and holds little significance.

Analysis of EUR/USD 1H




On the hourly timeframe, the EUR/USD pair might have completed its downward trend as early as the week before last. However, in recent days, the euro has been steadily declining, and it remains quite challenging to find explanations for this that do not border on science fiction. I believe the main reason for the irrational, illogical movements is the sideways trend on the daily timeframe. This sideways trend persists. For October 27, we highlight the following levels for trading: 1.1234, 1.1274, 1.1362, 1.1426, 1.1534, 1.1604-1.1615, 1.1657-1.1666, 1.1750-1.1760, 1.1846-1.1857, 1.1922, 1.1971-1.1988, as well as the Senkou Span B line (1.1637) and Kijun-sen line (1.1653). The Ichimoku indicator lines may move during the day, which should be considered when determining trading signals. Don't forget to place a Stop Loss at breakeven if the price moves in the correct direction by 15 pips. This will protect against potential losses if the signal turns out to be false.

Analysis are provided by InstaForex.

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Forex Analysis & Reviews: Overview of the EUR/USD Pair. October 28. The U.S. and China Have Agreed, but the Dollar... Falls...



The EUR/USD currency pair traded higher throughout Monday... We intentionally placed ellipses before the phrase "higher." Why? For the last four weeks, the market has been solely focused on ignoring the fundamental background. During this time, an enormous amount of significant information has become available to traders, not to mention unpublished macroeconomic statistics regarding the labor market and unemployment in the U.S. Trump has been introducing new tariffs and sanctions in bulk, threatening China, India, and Russia; a government shutdown has begun and continues; the third "No Kings" protest against Trump's policies took place in U.S. cities. Moreover, the Federal Reserve is moving closer to fulfilling Trump's long-held wish to lower the key interest rate multiple times. None of these factors prevented the U.S. dollar from growing. It has been growing slowly and weakly, but it was still rising when a decline would have been much more logical. So, what happened on Monday? On Monday, it was announced that Beijing and Washington discussed the most contentious issues in their relationship and reached an agreement. Thus, on Monday, when the tension surrounding trade relations between the two largest economies in the world was effectively lifted, the dollar fell... And that's all you need to know about the logic and patterns of movements in the EUR/USD pair over the past month. Well, we honestly don't care when exactly the dollar will begin its new prolonged decline. We fully understand that the market is driven by major players—market makers. Building new large positions worth billions of dollars takes time. While these positions are being formed, we see a flat on the charts. To see a flat on these charts does not require much effort. We have been drawing readers' attention to the daily timeframe for several weeks now. The pair has traded within the range of 1.1400-1.1830 since July 1 of this year. This means it has been nearly four months. During this period, it attempted to break out of the channel only once, unsuccessfully. Thus, the illogical downward movement over the last few weeks can be easily explained – it's an intra-flat random movement. While major capital is forming the necessary positions, the market sees a flat, but the flat would not be possible if the market continued to process macroeconomic and fundamental information (as we mentioned, over the past four months, there have been plenty of factors for a new decline in the American currency). But positions have not yet been formed, which is why the dollar is not falling, even though it should. So, what to do with all this information? From our point of view, the same thing that major capital is doing now. Forming positions and waiting for a trend movement to begin. Of course, a new upward trend cannot be guaranteed by anyone or anything, but given all the factors (not selectively), we believe the "2025 trend" will continue.

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Forex Analysis & Reviews: GBP/USD Overview. October 29: The Pound Struggles Without Europe



The GBP/USD pair traded differently on Tuesday than the EUR/USD pair, even though both pairs have shown similar dynamics in recent days, weeks, and months. Therefore, the reasons for the decline of the British currency should have been sought within the UK. It is worth noting that there were no macroeconomic reports or significant events scheduled for Tuesday in the EU, the UK, or the U.S.. Thus, the search took a while and was not focused on the economy. The cause of the new drop in the British pound was a statement from the "politician of the hour" – Rachel Reeves, the head of the UK Treasury. As mentioned earlier, Reeves has already triggered at least two significant declines in the British currency with her comments and actions. Initially, she broke down in tears in the UK Parliament amid criticism of her budget proposal for the next financial year. Then, Reeves commented several times on government bonds and the state of the UK economy. Later, she presented a failing budget proposal that was again subjected to harsh criticism. Thus, traders have formed a logical pattern – when the head of the Treasury speaks, it means they should prepare for selling the pound. This time, Reeves subtly implied that the UK's exit from the EU was a mistake and that restoring trade and economic ties with the Alliance would greatly benefit Britain. Furthermore, according to Reeves, new agreements with the European Union that alleviate some restrictions are gaining domestic public support. Overall, since the historic referendum in 2016 and following the official exit from the EU in 2020, numerous social surveys have been conducted among the British population to understand how attitudes toward Brexit have changed. Most of these surveys indicate that the British largely regret leaving the EU and would like to return to the Alliance at some point. It is noteworthy that as early as 2016, supporters of Brexit exceeded opponents by only 3%. Thus, almost half of the British population did not support the break from the EU even back in 2016, and their numbers have only grown over the years

Analysis are provided by InstaForex.

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Forex Analysis & Reviews: Overview of the EUR/USD Pair. October 30. Why the FOMC Meeting Doesn't Matter



The EUR/USD currency pair traded for most of Wednesday in a familiar fashion—characterized by minimal volatility and a complete lack of trend. Trading conditions in recent weeks have been far from ideal. First, the market is ignoring a plethora of factors, nearly all of which are against the dollar. Second, we have been experiencing a flat condition on the daily timeframe for several months. Third, due to the US "shutdown," the market currently lacks macroeconomic data related to the labor market and unemployment. Fourth, there is a general reluctance to engage in active trading, as shown in the illustration below. Thus, a single event clearly cannot rectify the situation. As is our tradition, we will not discuss the outcomes of the FOMC meeting in this article, as we believe it should take at least a day after such an event for all market participants to fully digest what has been said and seen. It often happens that during the release of results (which are primarily known in advance) or during Jerome Powell's speech, the market trades impulsively and emotionally. The price can soar upward at lightning speed, only to return to its original position within 10-15 hours. Therefore, we believe it is necessary to allow time before making definitive conclusions about the Federal Reserve's monetary policy and the market's reaction. The dollar's position remains unenviable regardless of the Fed's decision. If the Fed cuts the key rate, it's a "bearish" factor for the dollar. If the Fed does not cut the key rate, the dollar will still have a multitude of other factors working against it. We continue to believe that the ongoing flat on the daily timeframe is key in the current narrative, as a flat formation does not afford good movements regardless of any fundamental or macroeconomic events.

Analysis are provided by InstaForex.

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