EUR/USD, GBP/USD, USD/CAD, USD/JPY – U.S. Dollar Pulls Back As Traders React To PMI Data

Vladimir Zernov
Published: Jun 5, 2023, 16:25 GMT+00:00

U.S. Dollar Index moved below the 104 level after an unsuccessful attempt to settle above 104.40.

U.S. Dollar

In this article:

Key Insights

  • EUR/USD moved back above the 1.0700 level. 
  • GBP/USD found strong support near 1.2370.
  • USD/JPY pulled back below the 140 level as Treasury yields declined. 

U.S. Dollar

DXY 050623 Daily Chart

U.S. Dollar Index pulled back as traders reacted to the ISM Services PMI report, which missed analyst expectations. Treasury yields moved lower, serving as an additional bearish catalyst for the American currency.

The nearest support level for the U.S. Dollar Index is located at 103.75. In case the U.S. Dollar Index settles below this level, it will head towards the next support at 103.50.

R1:104.10 – R2:104.45 – R3:104.70

S1:103.75 – S2:103.50 – S3:103.20


EUR/USD 050623 Daily Chart

EUR/USD rebounded from session lows and settled above the 1.0700 level. The final reading of the Euro Area Services PMI report showed that Euro Area Services PMI declined from 56.2 in April to 55.1 in May, compared to analyst consensus of 55.9.

In case EUR/USD settles above the resistance at 1.0730, it will head towards the next resistance level at 1.0750. A move above this level will push EUR/USD towards the resistance at 1.0775.

R1:1.0730 – R2:1.0750 – R3:1.0775

S1:1.0700 – S2:1.0670 – S3:1.0635


GBP/USD 050623 Daily Chart

GBP/USD found support near 1.2370 and moved towards the 1.2450 level as traders focused on U.S. dollar’s pullback.

The next resistance level for GBP/USD is located at 1.2470. In case GBP/USD manages to settle above this level, it will head towards the resistance at 1.2485.

R1:1.2470 – R2:1.2485 – R3:1.2510

S1:1.2440 – S2:1.2400 – S3:1.2370


USD/CAD 050623 Daily Chart

USD/CAD is mostly flat despite the continuation of the rebound in the oil markets. Meanwhile, other commodity-related currencies are gaining some ground in today’s trading session.

If USD/CAD settles below the support at 1.3410, it will move towards the next support level at 1.3380. A successful test of this level will push USD/CAD towards the support at 1.3335.

R1:1.3440 – R2:1.3485 – R3:1.3530

S1:1.3410 – S2:1.3380 – S3:1.3335


USD/JPY 050623 Daily Chart

USD/JPY pulled back as Treasury yields moved lower. USD/JPY remains extremely sensitive to Treasury yields dynamics as traders do not expect changes in the BoJ policy.

A move below the support at 138.70 will push USD/JPY towards the next support level at 137.50. On the upside, USD/JPY needs to climb back above 140.50 to have a chance to gain sustainable momentum.

R1:139.60 – R2:140.50 – R3:141.60

S1:138.70 – S2:137.50 – S3:136.50

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About the Author

Vladimir is an independent trader and analyst with over 10 years of experience in the financial markets. He is a specialist in stocks, futures, Forex, indices, and commodities areas using long-term positional trading and swing trading.

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