Can the US dollar hold range support in the week ahead, or will we finally see it capitulate?
Check out today’s Weekly Forex Forecast to see how I’m trading the DXY, EURUSD, GBPUSD, USDJPY, and USDCHF for the week ending September 27, 2024.
US Dollar Index (DXY) Forecast
The DXY is holding above key support at 100.60, but just barely.
Thursday’s candle wasn’t very convincing for dollar bulls, and today’s session is once again pushing on that critical support level.
A sustained break below 100.60 will open up the confluence of support at 99.60.
Alternatively, a bounce from 100.60 would keep the range intact.
However, the DXY would have to reclaim 102.60 from here to turn constructive toward higher targets.
Until then, I’ll approach this as a range unless 100.60 fails in the coming days.
EURUSD Forecast
EURUSD is flirting with a bullish breakout above 1.1140 today as the DXY struggles to bounce from support.
A weekly close above 1.1140 would expose the August highs and potentially the 2023 high at 1.1275.
Alternatively, a close below 1.1140 would keep the area intact as resistance as we move into next week.
GBPUSD Forecast
GBPUSD is also pushing higher today on USD weakness.
We saw last week close above the 1.3100 key level, so this week’s rally isn’t too surprising.
A DXY sustained break below 100.60 could send GBPUSD to the confluence of resistance near 1.3480.
That’s a descending trend line that goes back years and a key horizontal level from 2019 to 2020.
Key support for GBPUSD comes in between 1.3230 and 1.3260 next week.
USDJPY Forecast
USDJPY is recovering a bit this week on a weaker Japanese yen.
However, USDJPY bulls are struggling with the 144.00 resistance area, leaving it intact as key resistance next week.
It will take a sustained break above 144.00 on the daily and weekly time frames to flip the area to support and expose 146.00.
Until then, USDJPY is capped by resistance and range-bound between 144.00 and 142.00 support.
USDCHF Forecast
USDCHF is trading at monthly support in the 0.8350 region.
That’s the bottom of a range that the USDCHF has traded in since mid-2023.
However, the US dollar has work to do to show strength against other currency pairs, including the Swiss franc.
One level I’d like to see recovered before looking for longs is 0.8570.
That’s the level which triggered the early 2024 rally, and one that could do the same, but only if the DXY can hold above 100.60 and reclaim 101.00 next week.
Otherwise, we could see USDCHF sweep the late 2023 low before bottoming.
