EUR/USD, GBP/USD, DXY Price Forecast: DXY Bullish Over $105.48; BOE Rate Ahead

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Published: May 9, 2024, 07:24 GMT+00:00

Key Points:

Forex markets quiet due to Ascension Day; GBP reacts mildly to -5% RICS House Price Balance drop.
Upcoming BoE reports and unchanged Official Bank Rate at 5.25% critical for GBP's future direction.
USD focus on domestic health with Unemployment Claims expected at 212K and upcoming 30-year Bond Auction.

EUR/USD, GBP/USD, DXY Price Forecast: DXY Bullish Over $105.48; BOE Rate Ahead

Market Overview

In the latest market activity, the forex market faced a relatively quiet trading environment due to the closure of banks in observance of Ascension Day. Meanwhile, the GBP saw a modest impact from the RICS House Price Balance, which reported a -5% rate, indicating a slight deterioration in the UK housing market compared to the previous -2%.

Events Ahead

For the GBP, critical events include the Bank of England’s Monetary Policy Report and the Monetary Policy Summary, both scheduled for 1:00 pm. These releases are crucial as they provide insights into the economic outlook and monetary policy direction, with the MPC Official Bank Rate Votes expected to remain unchanged at 0-0-9.

Additionally, the Official Bank Rate is anticipated to stay at 5.25%, a decision that will be closely watched by traders.

For the USD, the focus shifts to domestic economic health with the release of Unemployment Claims at 5:30 pm, expected at 212K, slightly up from the previous 208K. Furthermore, Mortgage Delinquencies and the 30-year Bond Auction data are due later in the day.

US Dollar Index (DXY)

Dollar Index

The Dollar Index currently trades at $105.617, marking a slight increase of 0.11%. Positioned just above both the 50-day and 200-day Exponential Moving Averages, set at $105.425 and $105.500. Today’s pivot point is established at $105.480, which serves as a critical juncture for the index.

Immediate resistances are identified at $105.886, $106.146, and $106.483. These levels could restrict upward movements unless surpassed. Conversely, supports are located at $105.223, $104.938, and $104.640, safeguarding against potential declines. Given the index’s stance just above its pivot and moving averages, maintaining above $105.480 may favour further bullish behaviour.

EUR/USD Technical Forecast

EUR/USD Price Chart – Source: Tradingview

The EUR/USD is trading at $1.07388 today, reflecting a modest decline of 0.09%. The 50-day and 200-day Exponential Moving Averages, which are currently at $1.07476 and $1.07287, respectively, mark the pivot point of $1.07382 within a constrained range. This positioning indicates a potential tipping point for future price movements.

Key resistance levels are set at $1.07778, $1.08124, and $1.08533, which could cap upward progress. Support levels are identified at $1.06951, $1.06512, and $1.06119, crucial for preventing further declines. However, a break above $1.07382 may signal a move towards a more bullish stance.

GBP/USD Technical Forecast

GBP/USD Price Chart – Source: Tradingview

GBP/USD pair is trading at $1.24837, registering a slight decline of 0.11%. The pair is currently hovering just below the pivot point of $1.25017, situated near both the 50-day and 200-day Exponential Moving Averages, which stand at $1.25162 and $1.25153, respectively. This convergence suggests a critical juncture for the currency pair’s short-term direction.

Resistance levels are set at $1.25378, $1.25839, and $1.26318, which could serve as ceilings for any upward movement. On the downside, support is found at $1.24663, with further floors at $1.24230 and $1.23797 that could stabilize declines. Given the GBP/USD’s proximity to key moving averages and the pivot point, movements above $1.25017 may signal a shift towards a bullish trend.

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

About the Author

Arslan Aliauthor

Arslan, a webinar speaker and derivatives analyst, has an MBA in Finance and MPhil in Behavioral Finance. He guides financial analysis, trading, and cryptocurrency forecasting. Expert in trading psychology and sentiment.