Weekly Forex Forecast (February 6-10, 2023)

by Justin Bennett  · 

February 4, 2023

by Justin Bennett  · 

February 4, 2023

by Justin Bennett  · 

February 4, 2023

Today’s weekly Forex forecast covers the DXY, EURUSD, GBPUSD, USDJPY, and USDCAD.

The dollar reversed higher last week, and a few major currency pairs broke significant levels, making this week a pivotal one for February.

Watch the video and scroll down to view the charts to prepare for next week.

US Dollar Index (DXY) Forecast

The USD index (DXY) rallied on Friday after reclaiming 101.50.

However, dollar bulls have their work cut out next week with 103.50, a confluence of resistance based on the key horizontal and channel resistance.

A daily close above 103.50 would open up 105.60 and push pairs like EURUSD and GBPUSD lower.

Alternatively, a daily close below 102.60 would suggest that Friday’s move was a fakeout and keep the recent DXY range intact.

EURUSD Forecast

EURUSD broke several key support levels on Thursday and Friday.

Following Thursday’s close, I mentioned to members of the Discord group that we could get a pullback from EURUSD.

Sure enough, Friday retested that 1.0925 level and sold off significantly.

That said, the euro is approaching key support at 1.0780 and 1.0700.

So we could see a bounce early this week from one of those areas and a retest of the 1.0850 region as new resistance.

But last week’s EURUSD candle signals weakness and a potential retest of 1.0700 next week.

GBPUSD Forecast

I wrote about the GBPUSD trend line from the September 26th close on Thursday.

I mentioned that a daily close below 1.2240 would confirm the breakdown, and Thursday’s session closed at 1.2224.

So it’s no surprise that GBPUSD weakened on Friday, although I’m not sure anyone expected a 175 pip selloff.

For the week ahead, GBPUSD bears will likely defend 1.2110.

However, the recent range lows at 1.1900 should attract significant demand if tested.

USDJPY Forecast

We saw USDJPY close above 130.60 on Friday, a level I’ve mentioned several times in recent videos.

The first 24 to 48 hours of next week should tell whether Friday’s breakout holds.

If so, a rally toward 134.50 resistance seems likely.

However, if USDJPY closes Monday or Tuesday back below 130.60 and particularly 129.40, it would suggest further weakness.

But as of now, last week confirmed a USDJPY bullish breakout.

USDCAD Forecast

USDCAD bounced right from the 1.3300 support area I’ve discussed recently.

That’s the July 2021 trend line, which has served as key support since September 2022.

As long as USDCAD is above 1.3350, I like the pair higher toward the October trend line at 1.3560.

And as mentioned in today’s video, I’d expect bulls to defend 1.3350 to 1.3370 this week.

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