US Dollar Price Forecast: Bullish DXY Outlook, Slower 2025 Rate Cuts – Gold, GBP/USD and EUR/USD Outlook

Key Points:

• US Dollar remains strong amid expectations of slower rate cuts in 2025, supporting DXY's bullish outlook.

• The Fed’s stance on slowing rate cuts puts pressure on gold, limiting its upside potential.

• DXY stays above key support levels, showing bullish momentum despite mixed U.S. economic data. ### In this article:

• Gold

+0.10%

• GBP/USD

-0.01%

• EUR/USD

-0.13%

US Dollar and Gold Outlook: Mixed Sentiment Amid Data

The U.S. dollar showed resilience following the release of mixed economic data, including weaker-than-expected durable goods orders and a dip in core durable goods orders. The Dollar Index (DXY) maintained strength, supported by ongoing economic uncertainty and expectations of slower interest rate cuts by the Federal Reserve in 2025.

Gold, on the other hand, remained stable around the $2,618 mark, benefiting from geopolitical tensions and its role as a safe-haven asset. However, gold’s upside potential is limited by the firm U.S. dollar and rising bond yields, creating a tug-of-war between safe-haven demand and yield-seeking investors.

US Dollar Index (DXY) – Technical Analysis

Dollar Index Price Chart – Source: Tradingview The Dollar Index (DXY) is trading at $108.159, showing a slight increase of 0.07%. The price remains above the key pivot point of $107.998, indicating bullish potential. The 50-day EMA at $107.859 supports this upward momentum, while the 200-day EMA at $107.051 suggests a longer-term bullish trend.

If DXY manages to break above immediate resistance at $108.541, we could see further gains toward $108.901.

However, if it drops below $107.998, a bearish shift might trigger a move towards support at $107.603 and $107.181. The current upward channel continues to support buying pressure for the U.S. dollar.

GOLD – Technical Analysis

Gold – Chart Gold (XAU/USD) is trading at $2,605.73, up 0.78%, with a critical pivot point at $2,632.28. Immediate resistance is at $2,663.39, while support lies at $2,583.97. The 50-day EMA at $2,651.28 and 200-day EMA at $2,654.80 indicate a bearish bias.A break above $2,632.28 could push gold towards $2,663.39, but failure to sustain this level may trigger selling pressure, targeting $2,583.97.

Sterling Outlook: Mixed Economic Data

The British Pound (GBP) displayed resilience amid mixed economic data on Monday. The UK’s current account deficit narrowed to -£18.1B, better than expected, and the final GDP reading showed steady growth at 0.0%.

Business investment exceeded forecasts, rising by 1.9%. Despite these positive indicators, retail sales underperformed last week, putting pressure on the pound.

GBP/USD Technical Analysis

GBP/USD Price Chart – Source: Tradingview GBP/USD is currently trading at $1.25327, showing a slight 0.02% gain. The pair is hovering just below the pivot point at $1.25568, which remains a critical level for its direction.

The 50-day EMA at $1.25708 suggests a neutral to slightly bullish bias, while the 200-day EMA at $1.26497 is still above, indicating some resistance.

If GBP/USD breaks above $1.25568, the momentum could shift toward the next resistance at $1.26150. Conversely, failure to hold above this level could see a dip toward support at $1.24746, with further downside at $1.24218.

EUR Strengthens on Better-Than-Expected Data

The Euro (EUR) found support on Monday following Germany’s stronger-than-expected import prices, which rose by 0.9% month-over-month, surpassing the forecast of 0.5%. This suggests resilient demand in the Eurozone despite ongoing economic challenges, providing a positive sentiment for EUR, particularly amid holiday trading conditions.

EUR/USD Technical Forecast

EUR/USD Price Chart – Source: Tradingview EUR/USD is trading at $1.03931, down 0.11%, and remains under pressure as it hovers below the pivot point at $1.04473. The 50-day EMA at $1.04176 and the 200-day EMA at $1.04821 suggest a bearish bias, with the pair struggling to break above the key resistance at $1.04473.

If it fails to clear this level, the downward trendline will likely push the pair lower, targeting immediate support at $1.03426, with further downside potential toward $1.02760. A break above $1.04473 could shift the momentum in favor of bulls.