US Dollar Forecast: Pending Home Sales Boost Sentiment – Gold, GBP/USD, and EUR/USD Outlook

Market Overview

The US Dollar saw mixed performance with the Chicago PMI dropping to 36.9, below the forecast of 42.7, signaling economic weakness. Pending Home Sales, however, surprised at 2.2%, far above expectations of 0.9%.

Meanwhile, Gold (XAU/USD) remains steady at $2,605.45, up 0.10%, benefiting from subdued US PMI data and geopolitical tensions.

Upcoming key events include Unemployment Claims (forecast: 220K) and ISM Manufacturing PMI on January 3. Traders should watch for these indicators’ impact on the dollar and gold prices in the week ahead.

US Dollar Index (DXY) – Technical Analysis

The Dollar Index (DXY) is trading at $107.936, down 0.13%, reflecting mild bearish pressure but remaining near its pivot point at $107.915. Holding above this key level could sustain the bullish bias, with immediate resistance at $108.541 and the next target at $108.901.

On the downside, immediate support is noted at $107.580, with further protection at $107.152. The index hovers just below the 50 EMA at $108.033, suggesting short-term weakness, but stays above the 200 EMA at $107.446, which supports a broader uptrend.

The 4-hour chart highlights an upward channel, offering optimism for buyers. A break below $107.915, however, could shift momentum, triggering sharper declines toward support levels.

GOLD Technical Analysis

Gold (XAU/USD) is trading at $2,605.45, down 0.01%, with bearish sentiment prevailing. The pivot point at $2,609.48 is critical; staying below this level suggests further downside.

Immediate support lies at $2,587.82, with deeper levels at $2,571.05, while resistance at $2,631.97 and $2,650.91 caps upward momentum.

Trading below the 50 EMA ($2,617.44) and 200 EMA ($2,633.69) signals short-term weakness, keeping the bearish trend intact unless gold reclaims $2,609.48.

GBP/USD Technical Analysis

The GBP/USD is trading at $1.25567, up 0.06%, showing slight bullish momentum as it hovers near its pivot point at $1.25553. Holding above this level could signal further gains, with immediate resistance at $1.26616 and the next hurdle at $1.27251. On the downside, support lies at $1.25037 and $1.24395, critical levels to watch if bearish pressure resumes.

The pair trades just above the 50 EMA at $1.25545, suggesting short-term strength, but remains below the 200 EMA at $1.26133, reflecting broader cautious sentiment. A decisive break above the pivot could attract buyers, while a dip below could encourage sellers to test lower levels.

EUR/USD Technical Forecast

The EUR/USD is trading at $1.04091, up 0.03%, as it cautiously navigates near its pivot point at $1.04139. This level is critical—staying below suggests bearish momentum, with immediate support at $1.03787 and deeper protection at $1.03454. Conversely, a break above the pivot could lead to tests of $1.04490 and $1.04945 resistance levels.

The pair is hovering just below its 50 EMA at $1.04130, while the 200 EMA at $1.04569 reinforces broader bearish sentiment. The RSI reflects a balanced market, leaving room for a decisive breakout or further downside.