Weekly Forex Forecast For February 19-23, 2024

The Forex market remains mixed following last week’s US inflation data, which surprised to the upside.

Today’s forecast covers the latest on the US Dollar Index (DXY), EURUSD, GBPUSD, USDJPY, and XAUUSD.

Let’s begin!

US Dollar Index (DXY) Forecast

The DXY has been mixed lately, chopping around the 104.20 – 104.50 region.

We saw the dollar index close above 104.45 following Tuesday’s hot US CPI numbers, but bulls lost the level into the weekend.

It’s unclear if 104.20 will remain support for the DXY, but a pullback to 103.50 – 103.80 shouldn’t be ruled out.

Alternatively, a daily close above 104.45 next week should reignite buyers.

EURUSD Forecast

EURUSD remains as indecisive as the DXY.

We saw the euro reclaim 1.0730 and 1.0755 last week, hinting at a possible run toward 1.0820 next week.

However, given the sideways action and indecision from EURUSD, I need to see more to feel comfortable making a call here.

As of now, this is a ranging market between 1.0720 and 1.0820.

GBPUSD Forecast

GBPUSD attempted to reclaim 1.2612 into the weekly close, but bulls fell just short.

Like other markets, I need to see more from the pound to make a decision, one way or the other.

The 1.2612 region may serve as resistance next week with a close above that opening up 1.2700.

Otherwise, if bears can defend 1.2612, we may see a return to last week’s lows.

USDJPY Forecast

USDJPY is holding above 149.70, making that a key support to watch next week.

A sustained break below that would expose the 148.35 region.

Key resistance for USDJPY is the 152.00 multi-year highs.

Gold (XAUUSD) Forecast

Gold closed above the $2,000 area on Friday, suggesting a possible retest of $2,030 – $2,040 resistance next week.

That will be a critical area for XAUUSD, as it could decide where the metal trends in the coming weeks.

Alternatively, a sustained break below $2,000 next week would suggest that Friday’s rally was a low-volume anomaly.