Forex Friday

Middle East developments remain the principal lodestar for FX traders, and unless there’s a material shift, dollar’s losses will likely be limited, and it may even find a floor around current levels. As such, the EUR/USD forecast is still subjective to increased volatility as investors await further developments in the Middle East.

Following Israel’s strikes on Iran, the dollar bounced back as it took a boost from oil prices spiking, while also benefitting from increased haven demand. The euro and other risk sensitive currencies fell. But it is far too early to declare an end to the bullish EUR/USD outlook.

The EUR/USD weakened in the first half of Friday’s session as the US dollar made a comeback after yesterday’s drop. The greenback rebound, some would say rather surprisingly, in the face of fresh uncertainty surrounding President Donald Trump’s ever-contentious tariff agenda.

The overall strength in the GBP/USD forecast stems more from a weakening US dollar rather than a strengthening pound. This is because investors remain focused on the structural problem looming over Washington: surging debt levels.

This US-China trade truce has only had a limited influence on the dollar, with the greenback held back by soft data. Against this backdrop, the EUR/USD forecast remains modestly positive in the near-term outlook.

GBPUSD, USDCAD Outlook: This week, the U.S. dollar lost bullish momentum, pushing both USDCAD and GBPUSD toward their respective 2025 extremes. With GBPUSD holding above 1.33 and USDCAD approaching 1.38, upcoming key events will be closely watched to reassess the market narrative.

USD/CAD, Bitcoin Outlook: With U.S. economic indicators still falling short of signaling a deeply concerning outlook, the U.S. Dollar Index (DXY) is holding firm in a bullish rebound. At the same time, haven demand appears to be shifting toward Bitcoin, which is gaining traction amid broader market uncertainty.

GBPUSD, Nasdaq Outlook: Markets remain range bound as mixed data fuels investor uncertainty. U.S. GDP turned negative, Core PCE hit 0.0%, and jobless claims rose. Strong earnings offer some support, but trade risks persist. What’s next with today’s NFP report?

EURUSD, Nasdaq Forecast: With US-China trade talks in focus, a $200 drop in gold, and key earnings and data ahead, markets remain on edge as investors await confirmation on the next directional move in the US Dollar and equity indices.

Any further signs of stagflation in today's data should be bad news for both risk assets and the dollar. With trade war uncertainty in the foreground, the USD/JPY forecast remains bearish, with 140.00 now looking an increasingly likely target for the sellers.

EURUSD, USDJPY Forecast: China escalates the trade war, raising tariffs on US goods to 125% starting April 12. The Dollar Index drops below 100, lifting EURUSD above 1.14 and pulling USDJPY down to 142 ahead of key US bank earnings today.