US Dollar Forecast: New Home Sales Data Looms; Gold, GBP/USD and EUR/USD Outlook

Weak Manufacturing Data and Low Confidence Weigh on U.S. Dollar

The Richmond Manufacturing Index dropped to -21, while the CB Consumer Confidence fell to 98.7, down from 105.6. These figures reflect growing concerns about U.S. economic strength, weakening the U.S. dollar and bolstering gold prices as a safe-haven asset.

Investors are now focusing on upcoming data, including New Home Sales at 699K and FOMC Member Kugler’s speech.

Any further economic weakness could push the dollar lower, enhancing gold’s appeal. The market will closely watch Wednesday’s releases for more clues on potential Federal Reserve policy shifts.

US Dollar Index (DXY) – Technical Analysis 

The Dollar Index (DXY) is trading at $99.937, down 0.06%, as it tests immediate support at $100.103.

The pivot point at $100.273 is crucial; a break above this level could push the DXY toward resistance at $100.419 (23.6% Fibonacci level) and further to $100.543 (38.2% Fibonacci level).

However, the 50-day EMA at $100.702 and the 200-day EMA at $101.084 remain key resistance levels, capping any significant upward momentum.

On the downside, a break below $99.978 could trigger further declines, with $99.850 as the next key support level. Overall, the outlook remains bearish unless the index can climb and hold above the $100.275 pivot.

Gold Technical Forecast

Gold (XAU/USD) is trading at $2,655.29, down 0.06%, showing some hesitation. A break above the pivot point at $2,659.47 could signal more bullish momentum, with resistance at $2,670.41.

On the downside, support lies at $2,652.42, with additional levels at $2,647.13 and $2,641.52. The 50-day and 200-day EMAs provide strong support at $2,638.12 and $2,595.91 respectively.

UK Manufacturing PMI Falls, MPC Speech in Focus

Sterling slipped following weaker-than-expected Manufacturing PMI at 51.5, missing the forecast of 52.3. Investors are now awaiting MPC Member Greene’s speech for insights into future monetary policy. With services data also softening, any dovish signals could pressure the pound further.

GBP/USD Technical Forecast

The GBP/USD pair is trading at $1.34087, down 0.3%, as it hovers near key support at $1.33872 (23.6% Fibonacci level). If it breaks below this, the next support levels to watch are $1.33607 and $1.33391.

On the upside, the pivot point sits at $1.34288—a break above this could see the pair test resistance at $1.34488 and $1.34739.

With the 50-day EMA at $1.33305, the pair remains supported in the short term, but pressure is building.

If the price fails to reclaim $1.34288, further bearish momentum could unfold. However, a break above the pivot would indicate a potential bullish reversal.

Euro Struggles; Weak PMIs and German Ifo Business Climate Data

Earlier this week, the German Ifo Business Climate index fell to 85.4, missing expectations of 86.1, signalling a deteriorating business outlook.

Additionally, weak PMIs across Germany and France, including French Manufacturing PMI at 44.0 and German Manufacturing PMI at 40.3, further underscore sluggish growth.

The Belgian NBB Business Climate also dropped to -13.3. With no major data scheduled for Wednesday, traders assess the euro’s vulnerability amid ongoing economic challenges in the Eurozone.

EUR/USD Technical Forecast

The EUR/USD is trading at $1.11928, up 0.12%, as it hovers near key resistance at $1.11992. A break above this level could push the pair toward $1.12130 and $1.12233, signalling further bullish momentum.

However, the pair appears overbought, meaning a pullback could be in play if it struggles to break resistance. Immediate support lies at $1.1181, aligning with the 23.6% Fibonacci level, followed by $1.11695 at the 38.2% Fibonacci level. The 50-day EMA at $1.11465 offers solid support.

Overall, a break below the $1.11992 pivot point may lead to bearish pressure, but sustained strength above this level could signal more upside.