The US dollar is bouncing from critical support today following the latest non-farm payroll numbers, but what does that mean for the forex market next week?
In today’s video, I share exactly how I’m trading the DXY, EURUSD, GBPUSD, AUDUSD, and XAUUSD next week.
US Dollar Index (DXY) Forecast
The US dollar continues to struggle after reaching the lower end of the 102.00 resistance range I mentioned in last week’s forecast.
In fact, the DXY tested 101.92 exactly on Tuesday before pulling back.
Today’s session is testing the December 2023 low at 100.60.
It’s also testing the intraday ascending channel discussed in Thursday’s EURUSD analysis.
This is a critical moment for USD bulls: either form a short-term bottom above 100.60 or face a drop toward the 2023 low at 99.60.
Friday’s close should provide clues about next week’s trend.
As long as 100.60 holds, the US dollar remains range-bound, making range trading a reasonable approach.
EURUSD Forecast
Today’s EURUSD price action is in line with what I expected from the non-farm payroll (NFP) release.
In Thursday’s video, I mentioned that Friday’s session would likely sweep Thursday’s high and retest the 1.1140 area.
Now it’s up to sellers to defend the late 2023 high, which failed as support last week.
I’m not making any assumptions here, as today’s close should provide enough clues about where the EURUSD trends next week.
A daily and weekly close below 1.1130-1.1140 would keep the December 2023 high intact as resistance.
It would also keep pressure on the 1.1000 support next week.
Alternatively, a sustained break above 1.1140 would flip the area back to support as we head into next week.
GBPUSD Forecast
GBPUSD held above its key 1.3100 support this week, invalidating any potential short setups.
Earlier in the week, I pointed out that GBPUSD would need to break below 1.3100 to expose downside targets.
As mentioned in recent videos, 1.3100-1.3140 marks the intersection of the 2023 high and an upper parallel from December.
Whether GBPUSD continues higher next week depends on today’s DXY close.
A DXY hold above 100.60 suggests more ranging, while a close below could push GBPUSD to new multi-year highs.
For now, GBPUSD remains range-bound between 1.3100 and 1.3260.
AUDUSD Forecast
AUDUSD has been mixed recently, along with many major currency pairs, due to the sideways movement of the US dollar.
However, AUDUSD did break below the 0.6760 region I highlighted in last week’s forecast.
I anticipated this following the breakdown from the August 5th ascending trend line, also discussed in last week’s video.
So far, key support at 0.6700 is holding, as is the 0.6760 resistance area.
Like many other pairs, where AUDUSD trends next week depends on what we see from the DXY today.
XAUUSD (Gold) Forecast
XAUUSD is another market that has been range-bound for the last few weeks.
In the recent Weekly Forex Forecast, I talked about how $2,527 was resistance for gold, and the $2,480 region was key support.
We saw both levels tested this week.
In last week’s forecast, I also discussed how a breakdown from the intraday ascending channel near $2,515 could send XAUUSD back to $2,475 support.
That’s precisely what we got from gold, and now bulls have pushed the metal back to its $2,527 range resistance.
Until XAUUSD can break one of these levels, trading it as a range makes sense to me.
A sustained break above the $2,527 area would expose the top of the June channel near $2,590, while a sustained break below $2,475 would open up $2,455.
