The forex market is stuck in a sideways range, but a breakout could be on the horizon.

In today’s video, I’ll show you how I’m trading the DXY, EURUSD, GBPUSD, USDJPY, and XAUUSD this week.

Don’t miss it!

US Dollar Index (DXY) Forecast

Like most of the forex market, the DXY has been in a sideways range since early March, trading between 103.00 and 105.00.

However, the USD index has yet to test the 103.00 trend line from 2023 or the descending trend line at 105.00.

That tells me we could see recent highs and lows get swept before the next big move.

For now, I’m anticipating more sideways action until the DXY can prove it’s ready for a breakout.

EURUSD Forecast

EURUSD is also stuck in a sideways range between 1.0777 support and the 1.0900 resistance area.

The euro continues to hold below the 1.0900 region on a weekly closing basis, which aligns with a trend line from late 2022.

It’s tough to justify trading EURUSD while it’s range-bound between these two levels, especially without a clear signal.

GBPUSD Forecast

GBPUSD has struggled to gain momentum since March 5th after a sharp three-day rally.

While I think there’s potential for more upside, I wouldn’t want to go long without a proper test of 1.2830.

That level would clear out liquidity below recent lows and give bulls a clear invalidation point.

There’s also a chance we see a sweep of recent highs first to fully retest the 1.3050 resistance.

As always, it’s a waiting game to see which scenario plays out first.

USDJPY Forecast

USDJPY has some of the cleanest levels in the forex market right now.

The pair recently broke below 148.64, but sellers couldn’t keep prices down.

The move back above 148.64 confirmed the sell-side fakeout and put 151.24 back in play.

For now, USDJPY is sideways, just like much of the forex market.

A sustained break above 151.24 would open the door to 154.80, while a break below 148.64 would expose the 146.60 lows again.

XAUUSD (Gold) Forecast

Gold is going parabolic again this week after breaking above the 2024 ascending channel.

Monday’s session confirmed the breakout with a retest of the level as new support.

Right now, XAUUSD bulls are in full control, so buying pullbacks seems like the best play for intraday traders.

However, if this breakout fails and gold drops back below $3,080 on the high time frames, we could see XAUUSD revisit $3,000 or even lower.

That would signal a failed breakout, which often leads to extended moves in the opposite direction.

But as long as $3,080 holds as support, there’s no reason to be bearish on gold.

• The USD/JPY forecast indicates increasing panic over the global economy.

• The yen was on the front foot at the start of the week.

• Data showed that the US core PCE price index increased by a bigger-than-expected 0.4%.  

The USD/JPY forecast indicates increasing panic over the global economy as Trump’s April tariffs loom. As a result, the yen soared on Monday amid safe-haven demand. On the other hand, the dollar collapsed as Treasury yields fell due to increased demand for bonds. 

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The yen was on the front foot to start the week as market participants worried about new Trump tariffs beginning on Wednesday. The US president has promised a 25% auto tariff and reciprocal tariffs on almost all countries that trade with the US. As a result, experts are forecasting an escalation of the global trade war. At the same time, the rising cost of goods might drive inflation higher in most countries. 

Weak global growth will mean an erosion of investors’ money. Therefore, many traders prefer to put their cash in safe-haven assets like the yen, gold, and US debt. The dollar has remained fragile since Friday despite data showing an unexpected surge in underlying inflation. 

Notably, the core PCE price index increased by 0.4%. Meanwhile, economists had expected an increase of 0.3%. The inflation report will keep the Fed cautious. This week, traders will watch the US monthly employment figures.

USD/JPY key events today

Market participants do not expect any key economic reports today. Therefore, all focus will remain on the looming Trump tariffs.

USD/JPY technical forecast: Sentiment shifts with channel breakout

On the technical side, the USD/JPY price has broken out of its bullish channel, indicating a bearish shift in sentiment. Currently, the price trades well below the 30-SMA, and the RSI is nearing the oversold region. Therefore, the bearish bias is strong. 

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Initially, the price made higher highs and lows within a bullish channel. However, the rally paused when bulls met the 151.01 resistance level. The price made a double top at this level, plus a bearish RSI divergence, signalling a looming reversal. Soon after, a surge in bearish momentum saw the price break below the 30-SMA. At the same time, the RSI dipped into bearish territory below 50. 

Given the solid bearish momentum, the price will soon retest the 148.25 support level If the downtrend continues, USD/JPY will likely reach the 146.75 support level.

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Created on March 31, 2025

• Since mid-March trading, the GBP/USD currency pair has been in an upward trajectory, breaking above the psychological resistance of 1.3000.
• The gains extended to the highest levels for the pair in more than four months, and closing last week’s trading stable around the 1.2937 level.
• According to licensed trading company platforms, the GBP/USD pair faced significant blows after the UK Consumer Price Index (CPI) came in weaker than expected, reinforcing the possibility of another round of monetary easing from the Bank of England in its upcoming policy statement.
• It is worth noting that the Bank of England’s recent decision was marked by less pessimistic participation in the Monetary Policy Committee, with only one member voting for an interest rate cut, while the rest called for no change in monetary policy.

Conversely, the US dollar finds support from the higher-than-expected rise in US durable goods orders, in addition to the return of risk aversion due to Trump’s tariffs on car imports. Concerns about exacerbating trade uncertainty keep riskier currencies in a weak position.

Trading Tips:

The GBP/USD pair is on an upward trajectory, but it’s important to note that investor risk aversion will benefit the US dollar.

The Impact of US Tariffs on the Currency Market

US trade policy has been a major focus of the forex markets following US President Trump’s announcement of a 25% tariff on all auto imports into the United States. Financial markets remain tense, as the US is expected to announce reciprocal tariffs this week. Uncertainty surrounds the level of tariffs and retaliatory measures from other countries.

The US tariffs will have some impact on the British economy, but the European Union is expected to perform worse. UK bond yields also rose slightly, boosting the pound.

The US dollar will be vulnerable if US economic conditions deteriorate, but there has been no evidence of labour market pressure in the latest jobless claims data. Major geopolitical developments have contributed to reducing market interest in the UK Spring Budget statement, but there are still fundamental concerns surrounding growth forecasts, which could weaken the British pound.

Technical Analysis for the GBP/USD pair today:

The GBP/USD pair is currently trading at 1.2940, showing signs of decline after reaching its recent highs. The chart shows a clear upward trend since January, with price action forming a series of bottoms and highs, although the pair has recently faced resistance. The GBP/USD pair is currently hovering around the 38.2% Fibonacci retracement level at 1.28379, after retreating from its recent peak. Important support lies at the 50% (1.27828) and 61.8% (1.27276) retracement levels, which could form potential rebound areas if the current decline continues.

Overall, the underlying trend remains bullish, as evidenced by the price trading above both the rising trend line established since January and the major moving averages. However, recent price action suggests a possible consolidation or minor correction phase. Currently, the price is testing the short-term 100-period simple moving average, which has acted as dynamic support throughout the uptrend. The long-term 200-period simple moving average continues to slope upward, confirming the overall bullish bias in the market.

Meanwhile, the stochastic indicator shows that the GBP/USD pair is moving away from overbought conditions, with readings recently declining from above 80. This suggests that momentum may be slowing in the short term, which could support continued neutrality.

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Created on March 31, 2025

• For three consecutive weeks, the USD/JPY currency pair has been moving in an ascending channel formation, with gains reaching the 151.20 resistance level.
• This is the highest for the pair in nearly a month, before closing the week’s trading stable around the 149.80 level.
• The currency pair will remain subject to investor reactions to the US administration’s imposition of tariffs on trade partners, in addition to the future of global central bank policies, particularly the future tightening of the Bank of Japan’s policy.

The US Dollar is Affected by Inflation Figures

According to Forex market trading, the US dollar’s performance against other major currencies was affected by the announcement of accelerating US Personal Consumption Expenditures (PCE) inflation in February. According to the economic calendar results, US inflation rose by 0.4% month-on-month in February, from 0.3% in January, exceeding expectations of 0.3%. The annual rate reached 2.8% from 2.7%, also exceeding expectations of 2.7%.

As is well known, PCE inflation is a measure of US inflation that the Federal Reserve considers when making US interest rate decisions and is closely watched by markets. According to licensed trading platforms, the US dollar fell from its highs following these figures, providing a clear explanation for the current US economic dynamics: stagflation conditions are uncomfortably close.

In general, upside surprises in inflation typically indicate a robust economy, leading to higher US bond yields and a stronger dollar. However, we are beginning to see the opposite reaction, with the dollar declining on the back of better-than-expected inflation data. This is because rising inflation is not accompanied by corresponding economic strength: stagflation describes an economy experiencing high inflation and declining growth.

Trading Tips:

We still recommend buying the USD/JPY pair at every downward level, but without risk.

Under these circumstances, the US Federal Reserve is unable to respond to economic weakness because inflation is moving in the wrong direction, ensuring the entrenchment of economic weakness. This increasingly proves the negative situation for the US dollar because of President Donald Trump’s aggressive tariff agenda.

As is well known, tariffs risk raising domestic prices and negatively impacting confidence. Recently, the Conference Board reported that its US consumer confidence index fell 7.2 points to 92.9, its lowest level in more than two years. The expectations index fell 9.6 points to 65.2, its lowest level in 12 years and well below the 80-point threshold that often signals an impending recession.

USD/JPY Technical Analysis and Expectations Today:

According to recent trading, the USD/JPY pair has declined to trade slightly below the 100-hour moving average. Friday’s decline pushed the USD/JPY pair closer to the 14-hour RSI overbought levels. Therefore, bears will seek to extend the current decline towards 149.30 or lower to the 148.20 support. Conversely, bulls will seek to capitalize on upward rebounds around 150.55 or higher at the 151.60 resistance.

In the long term, based on the daily chart, the USD/JPY pair is trading within an ascending channel. However, the 14-day RSI still has room to move before reaching overbought conditions. Therefore, bulls will seek to capitalize on the current wave of gains towards the resistance level of 152.40 or higher to the resistance level of 154.00. Conversely, and over the same period, bears will seek to capitalize on selling operations to take profits around 146.80 or lower at the support level of 144.00, respectively.

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Created on March 31, 2025

• Last week’s trading was generally bearish for the EUR/USD currency pair, with losses extending to the 1.0732 support level.
• By the end of last week’s trading, it attempted to recover, but its gains did not exceed the 1.0845 level before closing stable around the 1.0826 level.
• I expect the downward momentum for the EUR/USD pair to remain around and below the psychological support level of 1.0800 until the reaction to the announcement of US jobs data, which will have a strong and direct impact on the future of US Federal Reserve policies.

What is expected for the US dollar in the coming days?

Bank of America expects further losses for the dollar in the second quarter; He stated, “If history is any guide, the US Dollar Index (DXY) could return to 100 in the second quarter, indicating renewed strength for the euro, the Japanese yen, and other G10 currencies.”

In general, the US dollar will be vulnerable if US economic conditions deteriorate, but there has been no evidence of labour market pressure in the latest jobless claims data. According to economists, even if the US dollar sees a short-term recovery, the deteriorating fiscal outlook, slowing consumer spending, and increasing political uncertainty – particularly regarding the DOGE index – will overshadow the US currency as the year progresses.

Trading Tips:

We still recommend selling the euro against the US dollar from every upside level, but without risk.

US Stock Markets Affected by Trade Concerns

In recent trading and across stock trading platforms, US stock market indices closed sharply lower, affected by rising inflation concerns and increasing uncertainty regarding trade policy. According to trading, the S&P 500 index fell 2%, the Dow Jones Industrial Average fell 715 points, and the Nasdaq 100 fell 2.7%. Tech giants led the decline, with Alphabet, Amazon, and Meta shares falling more than 4% each, while Microsoft shares fell 3%.

In general, inflation concerns have escalated after the final reading of the University of Michigan’s US Consumer Confidence Index for March showed the highest long-term inflation expectations since 1993. At the same time, the core Personal Consumption Expenditures (PCE) price index, the Federal Reserve’s preferred US inflation measure, rose by 2.8% in February, exceeding expectations, while consumer spending grew by 0.4%. Investors are currently preparing for further trade disruptions as Trump’s 25% car tariff takes effect this week, raising fears of retaliatory action by major trading partners.

According to trading data, the S&P 500 and Nasdaq fell by more than 1% and 2%, respectively, marking their fifth weekly decline in six weeks, while the Dow Jones Industrial Average fell by 0.8%.

EUR/USD Technical Analysis Today:

According to trading on the daily chart, downward pressure on the EUR/USD pair will increase if bears manage to stabilize below the 1.0800 support level. Technically, the next most important support levels will be 1.0720 and 1.0600, respectively. From the latter level, technical indicators will move towards strong oversold levels. Conversely, based on the performance on the daily chart, no real and strong trend reversal will occur unless the EUR/USD price moves above the psychological resistance of 1.1000.

The EUR/USD pair will be affected in the coming days by the US administration’s reaction to the imposition of tariffs that could harm the European economy, in addition to signals from global central bank officials regarding tightening or not.

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