Today’s weekly forex forecast covers DXY, EURUSD, GBPUSD, USDJPY, and XAUUSD.
The dollar remains indecisive, causing volatile price action for currency pairs such as EURUSD and GBPUSD.
However, Friday’s USDJPY close confirms a possible setup next week.
Watch the video, scroll down to view the charts, and get ready for the next week.
US Dollar Index (DXY) Forecast
DXY attempted another breakout on Friday but failed to close below the March trend line.
But Friday was also the last trading day of the month, so I’m cautious about price action.
At the same time, the dollar index is above its year-to-date low of 100.80.
So DXY remains indecisive for now, with highs and closes above 102.60 becoming more bullish, continuing below 100.80 exposing 99.30.
EURUSD Forecast
EURUSD remains a difficult market to trade.
While the uptrend remains intact, price action has been incredibly volatile in recent weeks.
The euro has also been on its trendline since March and could go big this week.
A sustained break above 1.1080 opens 1.1180, while a daily close below that trend line exposes the bottom of September’s channel support at 1.0930.
GBP USD Prediction
GBPUSD is another difficult market to trade.
The currency pair has been chopping near the previous 1.2450 range high for the past few weeks, making it difficult to judge a possible resolution.
However, there is an ascending channel that has formed since early April and GBPUSD is approaching the next horizontal resistance at 1.2660.
Not much to do here for now, but a deviation above 1.2660 next week could be an interesting setup.
US dollar forecast
USDJPY is arguably the best looking forex chart of the coming week.
The pair has been on an upward trend since we wrote about our long chance earlier this month when it was trading around 131.00.
USDJPY closed above the 135.00 area last week.
Therefore, a pullback to 134.50 to 135.15 could present a lucrative long chance towards 138.00 and potentially the 140.00 area.
Alternatively, if the daily closing price falls below 135.00, the idea will be rejected.
Gold (XAUUSD) Forecast
Gold was flat again last week, above the trend line we wrote on Thursday.
A continued break below this level could present a short window of opportunity, but so far there is no solution for consolidation.
To say the least, we don’t want to trade XAUUSD while this sideways move continues.
A better approach is to wait for a sustained breakdown to move up to $1,920.
Due to the recent price action and the resistance at $2,070 just above the recent highs, I think it will be difficult to play on the long side.
