EUR/USD, GBP/USD, USD/CAD, USD/JPY – U.S. Dollar Is Under Pressure Ahead Of Tomorrow’s Fed Decision

Key Insights

• EUR/USD tries to settle above 1.0800 as Euro Area ZEW Economic Sentiment Index exceeds expectations. 
• GBP/USD tests new highs as traders react to the strong jobs data. 
• USD/CAD moved below the 1.3300 level as oil markets rebounded after the recent sell-off. 

U.S. Dollar

U.S. Dollar Index is losing ground after the release of U.S. inflation data. Traders bet that Fed will be less hawkish, although markets remain confident that Fed will raise the federal funds rate by 25 bps in July.

In case the U.S. Dollar Index settles below 103.20, it will move towards the 103 level. A successful test of this level will push the U.S. Dollar Index towards the next support at 102.80.

R1:103.50 – R2:103.75 – R3:104.10

S1:103.20 – S2:103.00 – S3:102.80

EUR/USD

EUR/USD tested new highs as Euro Area ZEW Economic Sentiment Index exceeded analyst expectations.

If EUR/USD settles above 1.0800, it will head towards the resistance at 1.0830. A move above this level will push EUR/USD towards the resistance at 1.0870.

R1:1.0800 – R2:1.0830 – R3:1.0870

S1:1.0780 – S2:1.0750 – S3:1.0730

GBP/USD

GBP/USD gained ground as traders reacted to UK Claimant Count Change report, which showed that the number of people claiming for unemployment benefits declined by 13,600 in May.

A move above the 1.2640 level will push GBP/USD towards the resistance at 1.2680. If GBP/USD climbs above 1.2680, it will head towards the next resistance level, which is located at 1.2720.

R1:1.2640 – R2:1.2680 – R3:1.2720

S1:1.2600 – S2:1.2580 – S3:1.2540

USD/CAD

USD/CAD tested new lows as oil markets rebounded after yesterday’s sell-off. Other commodity-related currencies have also moved higher.

If USD/CAD declines below the support at 1.3275, it will head towards the next support level at 1.3230. A move below this level will push USD/CAD towards the support at 1.3175.

R1:1.3300 – R2:1.3335 – R3:1.3380

S1:1.3275 – S2:1.3230 – S3:1.3175

USD/JPY

USD/JPY gains ground as Treasury yields continue to move higher ahead of tomorrow’s Fed decision.

In case USD/JPY settles above 140.50, it will head towards the resistance at 141.60. A successful test of this level will open the way to the test of the resistance at 142.25.

R1:140.50 – R2:141.60 – R3:142.25

S1:139.60 – S2:138.70 – S3:137.50

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