EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts – U.S. Dollar Rebounds From Session Lows After PMI Data

Key Insights

• EUR/USD gained ground as Euro Area Manufacturing PMI exceeded analyst expectations. 
• USD/CAD moved higher after BoC left the interest rate unchanged. 
• USD/JPY pulled back amid a lack of upside catalysts. 

U.S. Dollar

U.S. Dollar Index rebounded from session lows after the release of strong U.S. PMI reports. Manufacturing PMI moved back above the 50 level as the situation in the manufacturing sector improved.

In case U.S. Dollar Index stays above the 103.00 level, it will head towards the nearest resistance, which is located in the 103.50 – 103.75 range.

EUR/USD

EUR/USD gained ground as Euro Area Manufacturing PMI improved from 44.4 in December to 46.6 in January, compared to analyst consensus of 44.8. Numbers below 50 show contraction, so Europe’s manufacturing sector remains under pressure.

If EUR/USD climbs above the resistance at 1.0925 – 1.0950, it will head towards the next resistance level at 1.1010 – 1.1030.

GBP/USD

GBP/USD has also moved higher as traders reacted to PMi data from the UK. Manufacturing PMI increased from 46.2 in December to 47.3 in January, while Services PMI grew from 53.4 to 53.8. Both reports exceeded analyst expectations.

A move above the 1.2750 level will push GBP/USD towards the nearest resistance at 1.2820 – 1.2850.

USD/CAD

USD/CAD gained some ground after BoC Interest Rate Decision. Canada’s central bank left the interest rate unchanged at 5%, in line with the analyst consensus. Stronger oil markets did not provide sufficient support to the Canadian dollar in today’s trading session.

A successful test of the resistance at 1.3480 – 1.3500 will push USD/CAD towards the next resistance level at 1.3590 – 1.3620.

USD/JPY

USD/JPY is losing ground as traders take some profits off the table after the strong rebound from December lows.

If USD/JPY settles below the support at 147.00 – 147.50, it will move towards the next support level at 144.65 – 145.00.

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