EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts – U.S. Dollar Tests New Highs As ISM Manufacturing PMI Climbs Above 50

U.S. Dollar

U.S. Dollar Index tests new highs as traders react to PMI reports. The final reading of S&P Global Manufacturing PMI report indicated that S&P Global Manufacturing PMI declined from 52.2 in February to 51.9 in March. ISM Manufacturing PMI improved from 47.8 in February to 50.3 in March. This is the first reading above 50 since September 2022, so it’s not surprising to see that traders focused on this report. Treasury yields rallied as bond traders bet on a more hawkish Fed, which was bullish for the U.S. dollar.

In case U.S. Dollar Index settles above the 105 level, it will head towards the next resistance, which is located in the 105.75 – 106.00 range.

EUR/USD

EUR/USD retreats as traders react to U.S. economic data. Traders bet that ECB would be more dovish than Fed in the upcoming months.

The nearest support level for EUR/USD is located in the 1.0700 – 1.0720 range. RSI has already moved into the oversold territory, so the risks of a rebound are increasing.

GBP/USD

GBP/USD is also moving lower as traders focus on general strength of the U.S. dollar. The technical picture remains bearish as GBP/USD failed to settle above the resistance at 1.2650 – 1.2685 and tested new lows.

Currently, GBP/USD is trying to settle below the support at 1.2530 – 1.2550. A successful test of this level will provide GBP/USD with an opportunity to gain additional downside momentum.

USD/CAD

USD/CAD gains some ground despite rising oil markets. Other commodity-related currencies have also found themselves under pressure in today’s trading session.

From the technical point of view, USD/CAD remains stuck in a range between the support at 1.3480 – 1.3500 and the resistance at 1.3600 – 1.3620.

USD/JPY

USD/JPY continues its attempts to settle above the key resistance at 151.50 – 152.00. The economic data from the U.S. may serve as the key catalyst that may push USD/JPY above the 152.00 level.

The key question is whether BoJ is ready to defend the 152.00 level. If USD/JPY manages to settle above 152.00, it may gain strong upside momentum and move towards the 155.00 level.

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