EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecast – EUR USD Rise Piques Interest, Sterling And Yen In Focus

Key Insights

• U.S. Dollar Index pulls back post the Retail Sales data. 
• EUR/USD gains ground as traders react to the better-than-expected Euro Area ZEW Economic Sentiment Index report. 
• GBP/USD moves higher after UK Unemployment Rate report. 

U.S. Dollar

U.S. Dollar Index pulls back as traders react to the Retail Sales report. The report showed that Retail Sales increased by 0.7% month-over-month in July, compared to analyst consensus of +0.4%.

U.S. Dollar Index faced significant resistance near the 103.40 level, so it’s not surprising to see that some traders have decided to take profits off the table near multi-week highs.

EUR/USD

EUR/USD gained some ground as traders focused on the better-than-expected Euro Area ZEW Economic Sentiment Index report. The report showed that Euro Area ZEW Economic Sentiment improved from -12.2 in July to -5.5 in August, compared to analyst consensus of -14.

In case EUR/USD manages to settle back above the resistance in the 1.0950 – 1.0975 range, it will head towards the next resistance level, which is located in the 1.1070 – 1.1095 range.

GBP/USD

GBP/USD moved higher after the release of the UK Unemployment Rate report, which showed that Unemployment Rate increased from 4% in May to 4.2% in July.

If GBP/USD moves back above the 1.2750 level, it will gain additional upside momentum and head towards the 200 MA, which is located at 1.2825.

USD/CAD

USD/CAD is trying to settle above the 1.3500 level as traders react to the inflation reports from Canada. Inflation Rate increased from 2.8% in June to 3.3% in July, while Core Inflation Rate remained unchanged at 3.2%.

The resistance in the 1.3500 – 1.3520 area has already been tested several times and proved its strength. Most likely, USD/CAD will need additional catalysts to settle above the 1.3520 level.

USD/JPY

USD/JPY continues to move higher as there are no signs of BoJ intervention. Japan’s GDP Growth Rate increased from 0.9% in the first quarter to 1.5% in the second quarter, but this report did not provide material support to the Japanese currency.

Taking a look at the daily chart, RSI remains in the moderate territory, so there is plenty of room to gain additional upside momentum in the upcoming trading sessions.

For a look at all of today’s economic events, check out our economic calendar.