**Weekly Forex Forecast for DXY, EURUSD, GBPUSD, and XAUUSD (December 8-12, 2025)**
*Original analysis by Justin Bennett of Daily Price Action*
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The first half of December 2025 brings a critical period for the major forex pairs and gold, following volatile moves across global markets. Traders are facing a market driven by shifting central bank policies, geopolitical risks, and year-end positioning. The following analysis covers the US Dollar Index (DXY), EURUSD, GBPUSD, and XAUUSD, assessing key technical levels and likely scenarios for the week of December 8-12, 2025.
## US Dollar Index (DXY): Navigating Near Key Resistance
The US Dollar Index has spent much of the last quarter recovering from its late-summer lows. December opened with DXY advancing into crucial resistance, amid expectations for the Federal Reserve’s policy outlook and declining liquidity as 2025 draws to a close.
**Weekly Overview:**
– DXY recently peaked near the 106.00 area, testing a descending trend line from the cycle high in September.
– Last week’s candle formed a long upper wick, hinting at selling pressure above 106.00.
– Support rests at 104.50, where buyers have stepped in several times since October.
**Key Technical Levels:**
– **Resistance:** 106.00 (trend line and prior swing high)
– **Support:** 104.50 (multi-week horizontal level), followed by 103.80
**Forecast:**
– A sustained move above 106.00 on a weekly closing basis could signal further upside toward 107.00.
– Alternatively, a rejection at the resistance may lead to a pullback toward 104.50 and potentially 103.80.
– The Federal Reserve’s rhetoric this week, and US inflation data, will likely provide the catalyst for the next significant move.
**Actionable Insights:**
– Watch for bearish signals at the 106.00 resistance for potential short setups.
– A close above 106.00 offers a bullish bias with a target near 107.00.
– Monitoring USD pair correlations can provide additional entry confirmation.
## EURUSD: Near-Term Bounce Faces Headwinds
The euro showed resilience in recent sessions, bouncing from the 1.0650 support zone. However, the broader downtrend remains intact as the pair remains well below its autumn highs and faces strong resistance areas.
**Weekly Overview:**
– EURUSD snapped back from support near 1.0650 but quickly stalled at 1.0800.
– The rebound produced a series of lower highs, suggesting underlying weakness.
– The daily chart shows the pair capped by a descending trend line from the July high.
**Key Technical Levels:**
– **Resistance:** 1.0800 (psychological and horizontal resistance), 1.0850 (trend line)
– **Support:** 1.0650 (recent swing low and multi-month support), 1.0550 (yearly low)
**Forecast:**
– As long as EURUSD trades below 1.0800 and the descending trend line, the bears remain in control.
– A break below 1.0650 would expose the pair to further downside, targeting 1.0550.
– A close above 1.0800-1.0850 could shift momentum in favor of the bulls, potentially sparking a rally toward 1.1000.
**Actionable Insights:**
– Look for bearish entries on rallies that fail near the 1.0800-1.0850 area.
– Aggressive bulls may consider longs around 1.0650, but only with confirmed signals and tight risk management.
– Eurozone economic data, especially inflation prints and comments from ECB officials, will remain central to direction.
## GBPUSD: Struggling to Hold Recent Gains
Sterling has underperformed in recent weeks, weighed
Read more on GBP/USD trading.