US Dollar Forecast: Fed Speeches and Strong Data Drive Dollar Strength; Gold, GBP/USD and EUR/USD Outlook

US Dollar Rises on Strong Data, Fed Speakers in Focus

The US Dollar gained strength as the NFIB Small Business Index showed an increase to 91.9, slightly above the previous 91.5, reflecting business confidence. Additionally, Cleveland Fed Inflation Expectations stand at 3.4%, signaling inflation concerns.

Market attention now shifts to several speeches by Federal Reserve officials, including FOMC members Waller, Barkin, and Kashkari, which could offer further insights on interest rate policy.

For gold, a stronger dollar often pressures prices as it becomes more expensive for foreign buyers, keeping the yellow metal in a cautious trading range.

US Dollar Index (DXY) – Technical Analysis

The Dollar Index (DXY) is trading at $105.71, up 0.18%, maintaining a bullish stance above the pivot at $105.49. This pivot is crucial—staying above it keeps the upward trend intact.

Immediate resistance sits at $105.86, with further resistance levels at $106.08 and $106.29, which may pose short-term caps if the rally continues. On the downside, support is found at $105.27, followed by $104.95 and $104.72 if selling pressure emerges.

The 50-day EMA at $104.98 and the 200-day EMA at $104.23 support the current bullish outlook, emphasizing upward momentum. Until DXY falls below $105.49, the bullish trend is likely to continue.

Gold – Technical Analysis

Gold (XAU/USD) is trading at $2,605.27, down 0.55%, facing pressure below the $2,624.81 pivot. Immediate support is at $2,601.53, with further levels at $2,575.74 and $2,557.50.

Resistance lies at $2,642.84 and $2,657.26, while the 50-day EMA at $2,669.29 and 200-day EMA at $2,701.91 confirm a broader bearish trend.

GBP Drops as Unemployment Rises; Earnings Data Mixed

The British pound (GBP) faces pressure as UK employment data reveals a mixed picture. Claimant Count Change increased by 26.7K, below expectations of 30.5K but still a rise from the previous 10.1K.

The unemployment rate climbed to 4.3%, above forecasts of 4.1%, signaling labor market softening.

On a positive note, the Average Earnings Index improved to 4.3%, surpassing the 3.9% forecast, suggesting wage growth. Markets now await MPC Member Pill’s upcoming remarks for further insight.

GBP/USD Technical Analysis

GBP/USD is trading at $1.28213, down 0.37%, as the pair remains pressured below the pivot at $1.28463. This level, which recently acted as a breakout point, now serves as a key pivot; staying below it could keep the pair in a bearish trend.

Immediate support sits at $1.27916, with further levels at $1.27509 and $1.27210 if sellers maintain control. Resistance is seen at $1.28856 and $1.29249, with the 50-day EMA at $1.29079 reinforcing the bearish outlook.

Until GBP/USD clears $1.28463, we’re likely to see cautious trading with a downward bias.

Euro Steady with German ZEW Sentiment Above Forecast

The Euro (EUR) held steady as Germany’s Final CPI m/m met expectations at 0.4%, showing stable inflation in the region. The German ZEW Economic Sentiment index also slightly exceeded forecasts, reaching 13.2, up from the previous 13.1.

Meanwhile, the broader ZEW Economic Sentiment for the Eurozone rose to 20.5, surpassing the expected 20.1. This mild improvement in sentiment supports the euro, though broader economic challenges persist in the region.

EUR/USD Technical Forecast

EUR/USD is trading at $1.06325, down 0.15%, as it remains under pressure from a strong dollar. The immediate pivot at $1.06631 is a key level; if the pair rises above it, we may see a shift toward bullish sentiment.

However, with a downward trendline and the 50-day EMA at $1.07263, the bearish outlook remains intact. Immediate support is at $1.06199, with further support at $1.05990 and $1.05766 if sellers continue to dominate.

Resistance is set at $1.06881, followed by $1.07226, which would require a substantial buying push to overcome. For now, the pair is expected to stay in a cautious downtrend unless it decisively breaks above $1.06631.