EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts – U.S. Dollar Gains Ground As Treasury Yields Move Higher

U.S. Dollar

U.S. Dollar Index gains some ground as traders react to the Existing Home Sales report, which indicated that Existing Home Sales declined by 1.9% month-over-month in April.

U.S. Dollar Index continues its attempts to settle above the 50 MA at 104.74. In case U.S. Dollar Index manages to settle above this level, it will head towards the next resistance, which is located in the 105.75 – 106.00 range.

EUR/USD

EUR/USD pulls back as traders focus on general dynamics of the American currency.

If EUR/USD settles below the 50 MA at 1.0838, it will head towards the next support level, which is located in the 1.0785 – 1.0800 range.

GBP/USD

GBP/USD gains ground as traders focus on the inflation data from the UK. Inflation Rate declined from 3.2% in March to 2.3% in April, compared to analyst consensus of 2.1%. Core Inflation Rate decreased from 4.2% to 3.9%, while analysts expected that it would drop to 3.6%.

From the technical point of view, GBP/USD settled above the previous resistance at 1.2670 – 1.2700 and is moving towards the next resistance level at 1.2780 – 1.2800.

USD/CAD

USD/CAD is mostly flat despite the strong pullback in precious metals markets. Oil markets are flat, providing some support to the Canadian dollar.

USD/CAD found support in the 1.3600 – 1.3620 range and is slowly moving towards the 1.3700 level.

USD/JPY

USD/JPY gains ground as traders focus on rising Treasury yields. The yield of 2-year Treasuries settled above 4.85%, while the yield of 10-year Treasuries climbed above the 4.40% level.

In case USD/JPY settles above 156.50, it will move towards the nearest resistance at 158.00 – 158.50. Potential interventions from the BoJ are the key risk for the bulls. Previously, BoJ tried to defend the 158.00 level, although USD/JPY managed to test the 160.00 level.

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