Volatility is back in forex, and that’s a good thing. After weeks of quiet ranges, the markets are finally giving us some movement.
Here’s what I’m watching across DXY, EURUSD, GBPUSD, USDJPY, and XAUUSD going into next week.
US Dollar Index (DXY) Forecast
The DXY is still trading near that long-term 2011 channel support.
We’ve seen this area act as a base before, and once again, DXY is holding up around it.
On the daily chart, DXY broke out of a descending channel last week, putting 98.6 front and center as key support.
That’s the line in the sand for me. As long as DXY is above 98.6, I’ll keep a bullish bias.
A close below 98.6 would turn that into a failed breakout and open the door to fill that open gap lower.
On the upside, 99.88 to 100.00 is resistance for DXY.
If we stay above 98.6, expect DXY to stay range-bound between those two areas.
If we lose 98.6 on a daily close, I’d look for a move toward 97.80.
Until then, DXY is holding its floor.
EURUSD Forecast
EURUSD is testing 1.1580 again.
That level has flipped between support and resistance several times this year, and Friday’s price action hinted at a bullish reclaim.
If we get a clear close above 1.1580, that turns into support and sets up a run at 1.1645 next week.
That’s the five-week composite point of control, basically where price spent the most time in recent consolidation.
Above that, EURUSD targets sit at 1.1780.
But if EURUSD fails to hold 1.1580, it keeps this range intact, and we’re likely back testing 1.1500.
A lot of this will depend on what DXY does around 98.6.
If DXY breaks lower, EURUSD strength follows. Simple as that.
GBPUSD Forecast
GBPUSD is also trying to reclaim ground above 1.3330.
That’s the same story we’ve seen across the board, markets dipping below support, then trying to reclaim it.
A daily close above 1.3330 would flip it to support, but 1.3380 looms as nearby resistance.
There’s a cluster of old lows around that area, and they could easily cap GBPUSD until proven otherwise.
Lose 1.3330 again, and this becomes another failed reclaim.
That would put 1.3250 back in play.
Until we see a decisive move through 1.3380, GBPUSD remains range-bound.
Not the cleanest setup, but confirmation will come from how this week closes.
USDJPY Forecast
USDJPY is testing the top of its ascending channel again.
That upper boundary has been strong resistance, lining up around 151.20.
Below that, there’s a solid pocket of support between 150.70 and 151.00 from prior highs.
If buyers can hold that zone, USDJPY remains in a healthy uptrend inside the channel.
But if we get a sustained break below 150.70, that turns into a failed breakout and likely leads to a pullback to fill that weekend gap near 149.50.
For now, I’m watching USDJPY for a retest of support before any fresh move higher.
If it holds, 152.80 and even 158.00 (that old imbalance) come into view.
The market is in an uptrend until proven otherwise.
XAUUSD (Gold) Forecast
XAUUSD is still in a strong uptrend, but it’s flashing early signs of exhaustion.
Price broke above 4,000 last week only to fake out and drop back under.
That’s a classic deviation.
As long as XAUUSD stays below 4,000, that level becomes resistance.
A confirmed breakdown below trend line support could trigger a deeper pullback toward 3,800 or even 3,768, where an imbalance sits.
For now, though, the structure for XAUUSD is still bullish with higher highs and higher lows.
I’m not shorting it, but I’m also not chasing highs here.
If we reclaim 4,000 with conviction, that invalidates the fakeout.
Otherwise, patience wins. Let price prove itself.
That’s what I’m watching going into next week.
Key word: confirmation.
The setups are forming, but until we see daily closes above or below these levels, anything can still flip.
Manage your risk and trade the extremes, that’s key.
