US Dollar Price Forecast: Euro and UK PMIs Disappoint; GBP/USD and EUR/USD Outlook

Dollar Index Steady Ahead of Key PMI Releases

The U.S. Dollar Index remains stable as markets await crucial PMI data. Flash Manufacturing PMI is expected at 47.9, while Flash Services PMI is forecasted to come in at 55.7.

Traders are also eyeing speeches from FOMC members Goolsbee and Kashkari later in the day, which could provide further insights into the Federal Reserve’s policy direction.

Any significant deviation from the expected PMI figures could trigger volatility in the dollar.

US Dollar Index (DXY) – Technical Analysis 

The Dollar Index (DXY) hovers around $100.772, showing no significant movement. The chart is at a critical pivot point of $100.934, and the next moves could provide clues on where it’s headed.

Immediate resistance is found at $101.201, with higher targets at $101.471 and $101.821.

On the downside, support is seen at $100.527, with further levels at $100.227 and $99.943, offering a potential safety net.

The 50 EMA sits right at $100.933, indicating a crucial near-term threshold. Meanwhile, the 200 EMA is higher at $101.704, suggesting that longer-term trends remain more bearish.

A break above $100.934 would signal renewed bullish momentum, while a failure here keeps the outlook bearish. Watch these levels closely for cues.

Sterling Holds Steady as UK PMI Misses Expectations

The British pound held steady despite weaker-than-expected PMI data. The UK’s Flash Manufacturing PMI came in at 51.5, missing the forecast of 52.3, while the Services PMI dropped to 52.8, slightly below the anticipated 53.5.

While the figures indicate a minor slowdown, they remain in expansion territory, offering some support to the GBP.

GBP/USD Technical Forecast

The GBP/USD pair is currently trading at $1.32655 within an upward price channel. The immediate support level sits at $1.32186, while further downside support levels are $1.31672 and $1.31107.

On the upside, resistance stands at $1.33391, with further targets at $1.33799.

The 50 EMA is at $1.32105, slightly below the current price, signalling short-term bullish momentum. The 200 EMA at $1.30845 shows long-term support, which aligns with the overall uptrend.

Despite a brief dip, the pair remains within the ascending channel, suggesting continued upward potential if support holds. The key to watch will be any break below $1.32186 for the potential downside.

Euro Slips as Eurozone PMI Data Misses Forecasts

The Euro faced downward pressure on Monday, with French and German Flash PMI figures coming in below expectations. French Manufacturing PMI fell to 44.0, below the forecast of 44.3, while Services PMI dropped sharply to 48.3 from a previous 53.0.

German Manufacturing PMI also disappointed at 40.3, reflecting ongoing weakness in the sector. The broader Eurozone Manufacturing PMI posted 44.8, below the expected 45.7.

Services PMI showed some resilience at 50.5 but still missed forecasts. These weak numbers heighten concerns over a potential economic slowdown across the Eurozone.

EUR/USD Technical Forecast

The EUR/USD shows short-term bearish momentum on the 4-hour chart, with the price near $1.10842. Immediate support lies at $1.10683, and a break lower could test $1.10334 and $1.10009.

On the upside, resistance stands at $1.11902, with the next targets at $1.12237 and $1.12800 if bulls regain control.

The 50 EMA at $1.11175 is just above the current price, suggesting short-term weakness, while the 200 EMA at $1.10534 offers stronger support

The narrowing gap between the EMAs signals growing pressure, and these key levels will be pivotal in determining the next trend.