EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts – U.S. Dollar Retreats As Treasury Yields Fall

U.S. Dollar

U.S. Dollar Index is losing ground as traders start to prepare for the Fed Interest Rate Decision, which will be released on Wednesday. Today, traders also focused on Dallas Fed Manufacturing Index report. The report indicated that Dallas Fed Manufacturing Index declined from -14.4 in March to -14.5 in April, compared to analyst consensus of -11.

If U.S. Dollar Index pulls back below 105.50, it will gain additional downside momentum and move towards the 105.00 level.

EUR/USD

EUR/USD gains ground as traders react to Germany’s inflation report, which indicated that Inflation Rate remained unchanged at 2.2%. Analysts expected that Germany’s Inflation Rate would increase to 2.3%, so the report missed analyst estimates.

In case EUR/USD manages to settle above the resistance at 1.0700 – 1.0720, it will head towards the next resistance level, which is located in the 1.0785 – 1.0800 range.

GBP/USD

GBP/USD tests new highs as traders focus on general weakness of the U.S. dollar. Treasury yields are moving lower, putting additional pressure on the American currency.

Currently, GBP/USD is trying to settle above the resistance at 1.2530 – 1.2550. In case this attempt is successful, GBP/USD will head towards the next resistance, which is located in the 1.2670 – 1.2700 range.

USD/CAD

USD/CAD is moving lower amid rising demand for commodity-related currencies. Precious metals markets are moving higher, which is bullish for the Canadian dollar.

From the technical point of view, USD/CAD is heading towards the nearest support level at 1.3600 – 1.3620.

USD/JPY

USD/JPY is extremely volatile after an unsuccessful attempt to settle above the 160.00 level. It looks that BoJ has finally intervened to provide support to the Japanese yen.

Most likely, BoJ will try to defend the 160.00 level. USD/JPY will stay volatile inside the wide trading range between the support at 154.50 – 155.00 and the resistance at 159.50 – 160.00.

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