The US dollar is losing ground, but where should traders look for a potential bounce next week?
In today’s video, I break down the key levels to watch for the DXY, EURUSD, GBPUSD, AUDUSD, and XAUUSD. Don’t miss it!
US Dollar Index (DXY) Forecast
The DXY extended its pullback this week after breaking below its September trend line at 108.80.
Buyers held the selloff at 108.00 support for a few days, but today’s session is hinting at the DXY’s direction for next week.
One key support area to watch is the 106.00 region.
This level has been significant since November and December and aligns with a quarterly fair value gap.
If today’s session closes below 108.00, resistance for next week shifts to the 107.50–107.70 area.
EURUSD Forecast
EURUSD cleared two major resistance levels this week at 1.0350 and 1.0460.
This move wasn’t unexpected given the DXY’s break of its September trend line on Monday.
Looking ahead, I want to see EURUSD trade above 1.0615 to start “filling” the imbalance left by the November breakdown.
Ideally, this would coincide with the DXY testing the 106.00 support region.
Key support for EURUSD next week sits at 1.0460, with resistance between 1.0615 and 1.0670.
GBPUSD Forecast
GBPUSD is backtesting the area I mentioned in a video earlier this week above that 1.2380 level.
That was an imbalance that developed during the breakdown earlier in January.
However, given what we’re seeing from the DXY this week, I’m not convinced that now is the time to look for GBPUSD shorts.
The area between 1.2570 and 1.2620 will be interesting to watch next week, given the symmetry there since September.
The 1.2480 area could flip to support next week if GBPUSD closes above it today.
AUDUSD Forecast
AUDUSD broke out of its October descending channel this week, a pattern I mentioned keeping an eye on last week.
One resistance level I’m watching is the 0.6434 area, which aligns with the November low.
A retest there would help fill the imbalance left from November’s breakdown.
Key support for AUDUSD sits at 0.6275.
XAUUSD (Gold) Forecast
XAUUSD had a strong rally this week, breaking above the critical $2,716 level.
However, bulls now face an even bigger test at the $2,790 all-time high.
Gold came within $4 of that mark during Friday’s session, making a full retest likely early next week.
Despite this week’s bullish momentum, it’s crucial to remember that gold remains range-bound below $2,790.
That’s been the case since September, and as I always say: it’s a range until proven otherwise.
