EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecast – U.S. Dollar Moves Closer To Multi-Week Highs

Key Insights

• U.S. Dollar Index rises in response to housing and industrial production reports.
• GBP/USD edges upwards, reacting to the UK’s declining inflation rate.
• USD/JPY sees gains as U.S. Treasury yields rise, BoJ remains silent.

U.S. Dollar

U.S. Dollar Index gains some ground as traders react to the housing market reports. Building Permits increased by 0.1% month-over-month in July, while Housing Starts grew by 3.9%. Today, traders also focused on the Industrial Production report , which showed that Industrial Production increased by 1% month-over-month in July.

From the technical point of view, U.S. Dollar Index is trying to get to the test of the resistance in the 103.40 – 103.65 range. RSI remains in the moderate territory, and there is plenty of room to gain additional upside momentum.

EUR/USD

EUR/USD is moving lower despite the better-than-expected Euro Area Industrial Production report. The second quarter Euro Area GDP Growth Rate report met analyst estimates but did not provide additional support to the European currency.

In case EUR/USD settles below the 1.0900 level, it will head towards the next support in the 1.0835 – 1.0850 range.

GBP/USD

GBP/USD continues its attempts to settle above the resistance at 1.2725 – 1.2750 as traders react to the inflation data from the UK. Inflation Rate declined from 7.9% in June to 6.8% in July, while Core Inflation Rate remained unchanged at 6.9%.

A successful test of the 1.2750 level will push GBP/USD towards the 200 MA at 1.2825.

USD/CAD

USD/CAD is moving higher as oil markets remain under pressure. Other commodity-related currencies are also losing ground in today’s trading session.

Taking a look at the daily chart, a move above the resistance in the 1.3500 – 1.3520 range will open the way to the test of the next resistance at 1.3650 – 1.3670.

USD/JPY

USD/JPY gains ground as Treasury yields continue to move higher. There are no signs of interventions from the BoJ, which is bearish for yen.

From the big picture point of view, USD/JPY is slowly moving towards the next significant resistance in the 148.00 – 149.00 range.

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