EUR/USD, GBP/USD, DXY Forecast: DXY Up 0.12%; Beige Book in Focus

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Published: May 29, 2024, 08:06 GMT+00:00

Key Points:

The Dollar Index (DXY) rose to 104.635, up 0.12%, driven by strong U.S. data and hawkish Fed comments.
The German GfK Consumer Climate index improved to -20.9 from -22.5, showing better-than-expected sentiment.
The Beige Book release will provide insights into U.S. economic conditions, potentially impacting market sentiment.

EUR/USD, GBP/USD, DXY Forecast: DXY Up 0.12%; Beige Book in Focus

Market Overview

On May 29, the Dollar Index (DXY) rose to 104.635, up 0.12%, driven by hawkish comments from Federal Reserve officials and strong U.S. economic data. The German GfK Consumer Climate index improved to -20.9, up from -22.5, reflecting better-than-expected sentiment.

However, the German Preliminary CPI m/m for May fell to 0.2% from 0.5%, indicating weaker inflationary pressures.

Events Ahead

Looking ahead, the focus will be on key U.S. economic indicators. The Richmond Manufacturing Index is forecasted at -6, an improvement from the previous -7. Fed officials, including FOMC Members Williams and Bostic, will be speaking later in the day.

Additionally, the release of the Beige Book will provide insights into U.S. economic conditions.

US Dollar Index (DXY)

Dollar – Chart

The Dollar Index (DXY) is trading at $104.635, up 0.12%. The pivot point is $104.726, marking a critical level for market direction. Immediate resistance levels are at $104.896, $105.116, and $105.386.

On the downside, immediate support is found at $104.415, followed by $104.261 and $104.082. The 50-day Exponential Moving Average (EMA) is at $104.716, while the 200-day EMA is at $104.953.

The current setup indicates a bearish outlook below $104.726, but a break above this level could increase bullish momentum. Traders should watch these key levels for potential market shifts.

EUR/USD Technical Forecast

EUR/USD Price Chart – Source: Tradingview

The EUR/USD pair is trading at $1.08518, down 0.12%. It is currently below the pivot point of $1.08444. Immediate resistance levels are at $1.08761, $1.08952, and $1.09131, while support levels are found at $1.08245, $1.08051, and $1.07833.

Technical indicators show the 50-day Exponential Moving Average (EMA) at $1.08449 and the 200-day EMA at $1.07997, with the Relative Strength Index (RSI) remaining neutral.

The outlook for EUR/USD remains bullish above the pivot point of $1.08444, but a break below this level could trigger a sharp selling trend.

GBP/USD Technical Forecast

GBP/USD Price Chart – Source: TradingView

The GBP/USD pair is currently trading at $1.27623, reflecting a 0.12% decline. The pivot point is positioned at $1.27481, indicating a crucial support level. Immediate resistance levels are found at $1.27930, $1.28236, and $1.28637.

On the downside, support is seen at $1.27178, followed by $1.26744 and $1.26448. The 50-day Exponential Moving Average (EMA) stands at $1.27174, while the 200-day EMA is at $1.26234.

With the Relative Strength Index (RSI) showing a neutral stance, the pair maintains a bullish outlook above the pivot point of $1.27481. However, a break below this level could trigger a sharper decline.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Arslan Aliauthor

Arslan is a finance MBA and also holds an MPhil degree in behavioral finance. An expert in financial analysis and investor psychology, Arslan uses his academic background to bring valuable insights about market sentiment and whether instruments are likely to be overbought or oversold.

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