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EUR/USD, GBP/USD, USD/CAD, USD/JPY – U.S. Dollar Gains Ground As Treasury Yields Test New Highs
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The American currency is moving higher as traders react to the better-than-expected GDP report.
Key Insights
- EUR/USD settled below the 1.0900 level despite rising inflation in Germany.
- GBP/USD made an attempt to settle below 1.2600.
- USD/JPY tested new highs amid rising Treasury yields.
U.S. Dollar
U.S. Dollar Index gains ground as Treasury yields test new highs. Bond traders react to the better-than-expected GDP report, which showed that GDP increased by 2% in the first quarter.
From the technical point of view, U.S. Dollar Index is trying to settle above the resistance in the 103.25 – 103.45 range. If this attempt is successful, the U.S. Dollar Index will move towards the 104.50 level.
EUR/USD
EUR/USD remains under pressure after the release of Germany’s inflation reports, which indicated that Inflation Rate increased from 6.1% in May to 6.4% in June.
EUR/USD has already settled below the 1.0900 level and is moving towards the next support in the 1.0800 – 1.0825 range. RSI remains in the moderate territory, so there is plenty of room to gain additional downside momentum in the upcoming days.
GBP/USD
GBP/USD continues to pull back as traders focus on rising Treasury yields.
The next support level for GBP/USD is located in the 1.2520 – 1.2545 range, so GBP/USD has a good chance to gain additional momentum.
USD/CAD
USD/CAD continues its attempts to settle above the resistance in the 1.3240 – 1.3265 range. Oil markets are moving higher, which is bullish for the Canadian dollar.
If traders remain focused on the dynamics of oil markets, USD/CAD may settle back below the 1.3240 level and move towards the support in the 1.3180 – 1.3210 range.
USD/JPY
USD/JPY tests new highs as Treasury yields continue to move higher. The strong rally in Treasury yields is bullish for USD/JPY due to the ultra-dovish policy of the BoJ.
USD/JPY has a decent chance to settle above the 145.20 level due to rising Treasury yields, although it should be noted that RSI is in the overbought territory.
For a look at all of today’s economic events, check out our economic calendar.
About the Author
Vladimir Zernovauthor
Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.
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