Technical Analysis Outlook for Forex, Gold & US Indices

The week begins with a focus on key economic indicators, particularly the Non-Farm Payroll (NFP) and Purchasing Managers' Index (PMI) data. Forecasts suggest weaker NFP numbers, which could exert downward pressure on the U.S. dollar. If the dollar maintains its bearish trend, further downside movement is likely, especially if key support levels fail to hold.

Technical indicators reinforce this outlook. The fair value gap plays a crucial role in predicting price action, and the dollar's inability to sustain higher highs signals weakness. Institutional traders may anticipate further declines, adding to the bearish momentum. Additionally, volatility is rising, with the VIX spiking above 20, reflecting a risk-off sentiment in the markets.

Amid this uncertainty, gold continues to benefit, reaching new all-time highs. A weaker dollar would likely sustain gold's bullish trend. Key levels for potential pullbacks and buying opportunities align with fair value gaps, moving averages, and macroeconomic conditions.

The Australian dollar remains range-bound but shows potential for an upward breakout if key resistance levels are surpassed. However, economic uncertainties and impending tariffs could cap gains. Meanwhile, the New Zealand dollar has already broken down from its range, indicating further downside risk. Between the two, the Australian dollar appears to have stronger bullish potential.

When trading correlated currency pairs, assessing USD strength is essential. Choosing pairs with the strongest momentum ensures alignment with prevailing market conditions and enhances the probability of successful trades.

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