The dollar started strong this week, but couldn’t hold its ground, and that shift is setting up some interesting moves across the majors.
In today’s video, I’ll break down what I’m watching on the DXY, EURUSD, GBPUSD, USDCHF, and XAUUSD — including the key levels I’m eyeing for next week’s setups.
US Dollar Index (DXY) Forecast
The US dollar started the week with a rally, but buyers struggled to break through the 100.25 resistance, as anticipated.
The 100.25 August high was significant, and the unfinished auction made a sweep and rejection more likely.
Thursday’s session closed below the November open, which flipped to resistance on Friday.
So far, we’re seeing DXY sellers follow through on Thursday’s breakdown, with all eyes on 99.30.
I’ve discussed the two single prints in the 99.30 region since the October 30th rally. Inefficiencies like this are often revisited by markets.
What will be interesting is how the DXY handles the inefficiencies at 99.30, considering the 99.40 support is just above those.
A sweep below 99.40 and into 99.30 could offer some short-term relief, but it would have to be confirmed by buyers. That’s yet to be seen.
Below 99.40 is the 98.40 inefficiency. If traders are looking for a place for the dollar to bounce, that’s it.
Until then, I’ll be looking to sell rallies from the USD.
EURUSD Forecast
EURUSD signaled a bullish shift in momentum on Wednesday, as I noted in the VIP Discord group at the time.
That structure break opened the door to the November open at 1.1540 and key resistance at 1.1555.
The EURUSD struggled a bit there on Thursday, but a bullish reclaim seemed likely given the price action.
Fast forward to Friday, and EURUSD is basing above 1.1555. That will be significant going into next week if euro bulls can hold Friday’s rally.
The impulse above 1.1555 opens up the September low at 1.1608. We also have a buy-side single print at 1.1595 that could pull the price higher.
As for longs, I’d need to see a pullback into 1.1540/50 to fill Friday’s sell-side inefficiency and offer a favorable risk-to-reward ratio.
Provided the EURUSD rally holds on Friday, key support next week is at 1.1540/50, with resistance in the 1.1600 region.
GBPUSD Forecast
GBPUSD is also reclaiming a significant area on Friday.
The pair fell below its range lows to start the week, but bulls quickly pushed the market back to 1.3140.
We also have the November open at 1.3130, adding to the significance of the area.
I mentioned to VIP members on Thursday that they should anticipate a bullish move on Friday. Immediate retests like this are often early signs of a reversal.
The confirmation is whether GBPUSD bulls can hold Friday’s session convincingly above 1.3140.
Do that, and I like the idea of looking for longs on pullbacks next week.
Several buy-side unfinished auctions could serve as targets this month. Those include 1.3217 and 1.3280, as well as the September low at 1.3324.
Alternatively, if Friday fails to hold above 1.3140, I’ll stand aside next week and wait for more structure.
USDCHF Forecast
USDCHF is rotating lower from its 0.8100 range resistance. The weekly time frame has been incredibly clean for years, and shows this 0.8100 area the best.
Similar to the DXY, we have sellers taking over this week. In the case of USDCHF, the break below 0.8060 shifts the momentum in favor of sellers.
Support comes in at 0.8038. But also like the DXY, I wouldn’t be surprised to see a sweep of 0.8038 and some relief from the 0.8030 region.
However, with the overall structure shifting bearish, rallies could be for shorting.
As for targets, the 0.7950 area is appealing. We have a sell-side single print there and an unfinished auction at 0.7926.
Gold (XAUUSD) Forecast
Gold has been stuck in a tight sideways range since late October. It’s natural for a market to spend time exchanging hands after a liquidity event, such as the one we saw in mid-October.
As mentioned earlier in the week, the $4,030-$4,060 area is the line in the sand. That’s my trigger for a long.
Without a convincing close above $4,060, there isn’t much to do, as that’s required to confirm a bullish shift following the October cascade.
Furthermore, the potential for sell-side liquidity sweeps exists while XAUUSD is below the $4,060 range highs.
For that reason alone, trying to buy gold here is risky and ill-advised.
We’ve had the sell-side liquidity event; now we need buyers to show their hand and shift momentum from neutral to bullish. The $4,060 level is the hinge for that shift in momentum.
If buyers force a break of $4,060, my targets will include $4,150, $4,242, and the $4,300 area.
And if they can’t, I’ll stand aside and wait for a better opportunity.
