**Weekly Forex Forecast for DXY, EURUSD, GBPUSD, and XAUUSD (December 8-12, 2025)**
*Original analysis and insights by Justin Bennett, Daily Price Action*
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As the forex market heads into the week of December 8-12, 2025, traders continue to monitor key technical levels and macro catalysts. The US Dollar Index (DXY), EURUSD, GBPUSD, and XAUUSD are in focus, each grappling with critical support and resistance points. In this comprehensive forecast, we delve into the price action and potential scenarios for these major markets, providing technical perspectives and actionable insights for the week ahead.
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## US Dollar Index (DXY): Technical Structure and Outlook
The DXY has experienced significant moves lately, reflecting shifting US macro themes and general market sentiment. Last week’s action further solidified important horizontal levels and set the stage for potential volatility.
**Key Observations:**
– The DXY closed the previous week just under the 105.50 resistance area. This region has historically acted as a magnet for price, providing both support and resistance over the past several months.
– Despite multiple challenges to this level, the index continues to struggle with momentum, as evidenced by the latest daily candle closes.
– The broader uptrend remains intact on the daily timeframe, but bullish conviction is beginning to wane, with lower highs forming from mid-November forward.
**Technical Levels to Watch:**
– **Resistance:** 105.50 remains the key resistance zone to watch, marking last week’s highs and acting as a barrier since October. Beyond that, 106.70 is the next major horizontal resistance.
– **Support:** Immediate support resides near 104.30, aligning closely with last week’s swing lows. If broken, traders should look for a test of 103.60, which has also served as critical horizontal support since early autumn.
– **Trendline:** Additionally, a trendline support dating back to July crosses just below 104.00. A daily close beneath this trendline could signal a shift in momentum toward a deeper correction.
**Scenario Planning:**
– A decisive close above 105.50 could rejuvenate buyers, opening the door to a rally toward 106.70 or beyond.
– Alternatively, failure to hold above 104.30 and subsequent breakdowns would favor short setups targeting the 103.60 region and the longer-term trendline.
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## EURUSD: The Battle at Resistance
EURUSD remains highly sensitive to DXY’s fortunes. The pair staged a modest rebound in recent sessions, encountering notable resistance at previously broken multi-month trendlines.
**Technical Picture:**
– EURUSD ended last week testing the 1.0850 resistance, an area that combines a descending trendline from mid-2024 with horizontal supply.
– Sellers have been stepping in at this zone, resulting in several failed attempts to secure bullish daily closes above the level.
– The broader structure since October paints a consolidative outlook, with price compressing within a range between 1.0700 (support) and 1.0850 (resistance).
**Key Levels:**
– **Resistance:** 1.0850 is first and foremost the hurdle to overcome. If buyers forge a close above, the next test is likely 1.0950, aligning with the highs from August and September.
– **Support:** 1.0700 remains crucial, marking the lower bound of recent ranges. In the event of a sustained breakdown, sellers may target the 1.0570 region next, a level that has previously sparked reversals.
– **Trendline:** The descending trendline from 2024 cuts through the current resistance. This technical feature adds credence to the potential headwind faced just above current prices.
**Scenario Planning:**
– A daily close above 1.0850 would strengthen bullish positioning, with traders likely to anticipate a move toward
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