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Key Insights
- EUR/USD tries to settle above the 1.0900 – 1.0935 resistance area.
- GBP/USD pulls back after UK inflation reports.
- USD/CAD tests yearly lows after strong Retail Sales data from Canada.
U.S. Dollar
U.S. Dollar Index pulls back as traders react to Powell’s testimony. The Fed chair stays hawkish, but it is not sufficient to provide additional support to the American currency.
U.S. Dollar Index is moving towards the 102.00 – 102.15 support area. A successful test of this support area will push the U.S. Dollar Index towards the next support in the 101.00 – 101.15 range.
EUR/USD
EUR/USD continues its attempts to settle above the 1.0935 level despite rising Treasury yields.
RSI remains in the moderate territory, so EUR/USD has a good chance to get closer to the next material resistance in the 1.1070 – 1.1095 range in case it manages to settle above 1.0935.
GBP/USD
GBP/USD is losing ground as traders react to inflation reports from the UK. Inflation Rate remained unchanged at 8.7% in May, while Core Inflation Rate increased from 6.8% to 7.1%. Today’s move is likely driven by profit-taking, as some traders are ready to bet that higher inflation has been already priced in by the market.
From the technical point of view, GBP/USD remains stuck in the wide 1.2650 – 1.2850 range, and traders should not expect big moves until GBP/USD gets out of this range.
USD/CAD
USD/CAD is trying to settle below the support level at 1.3180 as oil markets test multi-week highs. The Retail Sales data provided additional support to the Canadian dollar.
Taking a look at the daily chart, USD/CAD is testing yearly lows. RSI is close to the oversold territory, but there is enough room to gain additional downside momentum. A move below the 1.3180 level will open the way to the test of the next significant support area in the 1.3080 – 1.3110 range.
USD/JPY
USD/JPY is trying to settle above the 142.35 level as Treasury yields continue to move higher. The BoJ remains ultra-dovish, which is bearish for USD/JPY.
The daily chart shows that USD/JPY will have a good chance to gain strong momentum in case it settles above the 142.35 level as there are no material resistance levels until the 144.20 – 145.20 range.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
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