Following the FOMC meeting on September 17th, the forex market seems more appealing, but there are definitely nuances to consider.
This Forex Forecast discusses trade setups for several currency pairs: DXY, EURUSD, GBPUSD, USDJPY, NZDUSD, and XAUUSD.
After watching the video, make sure to scroll down for further insights or annotated charts.
US Dollar Index (DXY) Forecast
The DXY has seen a strong rebound from 96.60, which I’ve highlighted as an essential point of support over the months.
The FOMC meeting offered Dollar Bulls the opportunity they needed to maintain that 96.60 level, which has been pivotal for DXY since 2011.
As long as the USD maintains positions above this mark, I lean towards a bullish sentiment.
Last week, prices crossed over 97.70, marking a crucial threshold for October’s price trends. Those levels are likely to evolve into new support, especially near last week’s action.
However, the Bulls are heading into challenging zones between 98.60 and 99.00 next week—both levels hold significance for DXY. The 98.60 point has played a role since June, with 99.00 being the channel resistance identified in May.
Next week, I expect DXY to fluctuate between 98.60 and 97.70. It might take some time for buyers to process last week’s significant gains.
If the Bulls manage to push past the 99.00 resistance area, we could see additional resistance points like 99.35 or 99.88 emerge.
On the flip side, if it slips back below 97.70, that would signal a bearish turn for DXY.
Given the historical support from 2011 and the reinforcement observed last week, I remain optimistic about the dollar’s prospects.
Eurusd Prediction
The EURUSD pair performed fairly well for us last week after breaking down on Wednesday.
I had mentioned this in a video earlier. There’s potential for lower levels, and indeed, the session on Wednesday closed below key levels, with the Euro struggling against its February trendline.
We pointed out in our VIP Discord Group how 1.1645 might act as support for the Euro. This is the composite control point for the past five weeks.
In simpler terms, it’s the level the euro was at most frequently between August and early September. Such spots usually act as support or resistance due to market memory.
So far, the Euro Bulls have managed to defend 1.1645 closely. Yet, I’m somewhat skeptical that this bounce is anything more than a temporary relief rally.
There are buy-side imbalances at 1.1722 and 1.1780 that market makers could target next week. However, retesting might present selling opportunities.
Expect more range trading for the EURUSD next week. Trading based on what the chart shows, rather than expectations, tends to yield better results.
Also, remember there’s a single print at 1.15643 (unfinished auction) around 1.1440. Those may be on the radar, particularly if EURUSD dips below 1.1645 on higher time frames.
GBPUSD Prediction
The GBPUSD pair also showed good results last week. In the previous forecast, we noted that a dip below 1.3580 indicated bearish momentum for the pound.
We previously discussed the 1.3529 single print which could offer shorting opportunities.
Last Tuesday provided perfect conditions for short entries up to 1.3537. That test ignited a new wave of sellers, driving GBPUSD down to around 1.3330.
Currently, Bulls are safeguarding their September lows at 1.3330, but, similar to EURUSD, I’m not convinced this bounce will be anything beyond a momentary relief.
On examining the pound’s market profile, two buy-side imbalances at 1.3410 and 1.3425 might play a role next week. These could draw attention early on.
Of course, I’m writing this with only a few hours left in my Friday session, so it remains to be seen whether we hit those levels. But if sellers hold that 1.3425 region, it may define movement for next week.
If we see a dip, there are lower targets at 1.3282 and 1.3254. Whether we reach those depends on if GBPUSD can maintain below 1.3330.
If Bulls reclaim 1.3380 by Friday, a relief bounce early next week is certainly possible.
USDJPY Prediction
USDJPY broke out last week after a period of sideways movement lasting almost two months. We talked about potential breakout strategies in Thursday’s video.
In that session, I noted a single print that could be influential. USDJPY tagged 149.51 last Friday, while the 148.94 print remains a point of interest for next week.
These areas may offer critical support for USDJPY if there’s a pullback.
However, the challenge for the Bulls rests on how DXY performs. The retest at 98.60 from last week was crucial and has attracted some selling pressure.
If USDJPY stays above 148.70, a push towards 150.23 or even 151.20 could be on the horizon.
Conversely, a drop below 148.70 could lead to a bearish outlook and expose the level around 147.00.
NZDUSD Prediction
A few weeks back, I pointed out that the 0.5890 barrier had bearish implications for NZDUSD, and I had anticipated breakouts resulting in a drop below 0.5817.
Now, looking at today’s market, it seems we’ve seen both of those come to pass.
The pair has already moved away from that 0.5890 level following a bearish close on September 18th, breaching support at 0.5817 last week.
This momentum seems likely to persist next week.
Still, like many other major currency pairs, the New Zealand dollar has left some imbalances to monitor. The first imbalance is at 0.5785 and another at 0.5805. I expect the market makers to target 0.5785 when trading resumes next week, though reaching 0.5805 may be challenging.
In any case, I’m leaning towards short positions as long as NZDUSD stays under 0.5820. Those imbalances might offer another opportunity.
For downside targets, there’s the bottom of the July downward channel. It’s hard to pinpoint exactly, but I’m guessing around 0.5660.
This particular level has been significant since early 2025 and reflecting pricing behaviors from the first quarter. Markets don’t tend to forget such points easily.
XAUUSD (Gold) Prediction
Gold continued its climb last week, surpassing $3,700. The pullbacks have been quite minimal and don’t seem to signal any reversals.
Currently, XAUUSD is nearing the upper edge of its weekly channel from 2024. We’ve discussed this pattern multiple times, and it’s now positioned above $3,800.
That isn’t necessarily a cue to be bearish, but it does prompt caution when considering new long positions.
Gold has also created some selling imbalances along the way. The nearest one happens to be at $3,703.
A deeper pullback in the coming days could potentially draw attention to $3,703.
However, shorting gold right now seems like a tough call. Even a possible pullback from $3,800 could provide a buying opportunity rather than justifying selling.
