The Force Touch feature was created to allow the Apple Watch to detect the level of force exerted on its display by the user. Depending on the force used, the Watch would respond accordingly.
It was particularly useful on the Apple Watch due to its small screen, but Apple has already included the technology in the new MacBook Pro, so the company obviously sees uses for it with its other devices.
The Force Touch for iPhone rumours were reported by China Times, which suggests that System-in-Package (SIP) modules that are similar to the ones found in the Apple Watch, and are responsible for Force Touch, are being included in the new iPhone.
Apple has worked hard to shrink down many of its components to fit inside the small Apple Watch, so it's likely that we'll see the fruits of its labours in its other mobile devices.
We've also recently heard rumours that Apple is considering dropping the iPhone's home button, so could the inclusion of Force Touch point to an alternative? We'll find out later this year.