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EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecast – Traders React To Powell Speech
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The U.S. Dollar Index gained ground following Federal Reserve Chairman Jerome Powell's remarks at the Jackson Hole Symposium.
Key Insights
- EUR/USD tested new lows after Powell’s remarks.
- GBP/USD continued its attempts to settle below the support at 1.2590.
- USD/JPY touched multi-month highs as Treasury yields moved higher.
U.S. Dollar
U.S. Dollar Index gained ground as traders reacted to Powell’s speech at the Jackson Hole Symposium. Powell said that Fed would raise rates further if necessary.
From the technical point of view, U.S. Dollar Index faced resistance near the 104.40 – 104.70 level and pulled back from session highs. RSI remains in the moderate territory, so there is enough room to gain additional upside momentum in the near term.
EUR/USD
EUR/USD remains under pressure as traders prepare for a hawkish Fed. Powell did not say anything new, but he was not dovish. As a result, EUR/USD tested new lows.
EUR/USD has recently settled below the previous support at 1.0835 – 1.0850 and is moving towards the next support level, which is located in the 1.0670 – 1.0700 range.
GBP/USD
GBP/USD has also tested new lows after Powell’s speech. The yield of 2-year Treasuries tested the 5.09% level, which was bullish for the U.S. dollar.
In case GBP/USD manages to settle below the support at 1.2590 – 1.2620, it will head towards the next support level at 1.2470 – 1.2500.
USD/CAD
USD/CAD gained ground despite the strong rebound in the oil markets as traders focused on the general dynamics of the American currency.
The nearest resistance level for USD/CAD is located in the 1.3650 – 1.3670 range. A move above this range will provide USD/CAD with an opportunity to gain additional upside momentum.
USD/JPY
USD/JPY is moving higher, which is not surprising as Treasury yields are rising after Powell’s speech.
Taking a look at the daily chart, USD/JPY is trying to settle above multi-month highs. In case this attempt is successful, it wil head towards the resistance in the 148.00 – 149.00 range.
For a look at all of today’s economic events, check out our economic calendar.
About the Author
Vladimir Zernovauthor
Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.
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