Weekly Forex Forecast For April 15 – 19, 2024

The US dollar rocketed higher last week on a hot CPI report, geopolitical concerns, and surging bond yields.

So what does that mean for the DXY, EURUSD, GBPUSD, USDJPY, and XAUUSD next week?

Find out in today’s Weekly Forex Forecast!

US Dollar Index (DXY) Forecast

The US dollar soared late last week, gaining an impressive 1.8% in three days.

The move came a week after the US 10-year yield reclaimed 4.335%, a significant level since last year.

In my opinion, this is only the beginning of USD strength as bond yields strengthen above critical levels.

However, timing is still key, and the DXY 105.80 to 106.00 region may attract sellers next week.

Friday’s close was right on the line, so the first 24 to 48 hours of trade next week will determine if 105.80 is support, or if we get a deeper pullback to 105.00.

Either way, I favor dollar longs while the DXY is above 105.00 and the US 10-year yield is above 4.335% on the higher time frames.

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EURUSD Forecast

Last week, the EURUSD crashed to its lowest level since November.

The pair took out the 1.0730 support on a weekly closing basis, flipping that region to resistance in the days ahead.

It’s unclear if we’ll get a retest of 1.0730, but the damage has been done.

Unless EURUSD bulls can reclaim 1.0730 in the days ahead, I favor shorting EURUSD on strength.

As always, timing with euro shorts is key, especially with EURUSD sitting on weekly support at 1.0635.

GBPUSD Forecast

GBPUSD is another currency pair that broke critical support last week.

The pair has spent the last few months ranging between 1.2500 support and 1.2800 resistance.

Last week’s close flips the 1.2500 region to new resistance and keeps 1.2375 support exposed.

Only a daily close above 1.2535 would flip GBPUSD bullish again.

As such, shorts from the 1.2500 area make the most sense, in my opinion, so long as GBPUSD trades below it.

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USDJPY Forecast

USDJPY broke above the 152.00 handle last week for the first time since 1990.

That confirms the ascending triangle I’ve discussed recently, with resistance coming in at 155.60.

However, USDJPY isn’t my favorite way to play USD strength.

In fact, it’s one of my least favorite at the moment.

That’s due to the uncertainty as to when the Bank of Japan (BoJ) will intervene, and the recent yen strength, which canceled out most of Friday’s dollar strength.

But as long as USDJPY is above 152.00 on the higher time frames, the bullish breakout is alive and well with a 155.60 target.

Alternatively, a sustained break below 152.00 on the daily time frame would be bearish.

XAUUSD Forecast

Gold has enjoyed a significant rally to all-time highs on the back of sticky inflation and geopolitical concerns.

Friday’s session saw a massive 4% range from XAUUSD, but bulls failed to close the metal above channel resistance at $2,380.

That hints at a possible pullback in the days ahead, but traders should be wary about trying to short XAUUSD.

The trend is clearly bullish, so buying pullbacks into support makes more sense than trying to time tops.

Key resistance for XAUUSD is $2,380, but a partial retracement of Friday’s upper wick seems likely.

Support comes in at $2,305 and $2,260.

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