U.S. Dollar Dives After Powell’s Dovish Comments: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Retreats As Powell Signals He Is Ready To Cut Rates In September

U.S. Dollar Index is under strong pressure as traders react to Powell’s comments at the conference in Jackson Hole. Powell signaled that Fed was ready to cut rates in September due to rising risks for the labor market. Traders rushed to increase their bets on dovish Fed, which was bearish for the American currency.

U.S. Dollar Index pulled back below the support at 98.00 – 98.20 and moved towards the 97.70 level. In case U.S. Dollar Index settles below 97.70, it will head towards the next support at 97.10 – 97.30.

EUR/USD Soars As Traders Focus On Powell’s Comments

EUR/USD rallied as traders focused on dovish Powell. Currently, EUR/USD is trying to settle above the resistance at 1.1685 – 1.1700.

If this attempt is successful, EUR/USD will head towards the next resistance level at 1.1800 – 1.1815.

GBP/USD Tests Resistance At 1.3485 – 1.3500

GBP/USD rebounded from weekly lows, supported by Powell’s comments. In the UK, traders focused on Gfk Consumer Confidence report. The report showed that Consumer Confidence improved from -19 in July to -17 in August, compared to analyst forecast of -20.

A successful test of the resistance at 1.3485 – 1.3500 will open the way to the test of the next resistance level at 1.3580 – 1.3595.

USD/CAD Retreats From Multi-Week Highs

USD/CAD pulled back from multi-week highs amid rising demand for commodity-related currencies.

A move below the 50 MA at 1.3826 will push USD/CAD towards the next support at 1.3735 – 1.3750.

USD/JPY Is Under Pressure As Treasury Yields Fall

USD/JPY is losing ground as traders focus on falling Treasury yields. The yield of 2-year Treasuries settled below the 3.70% level, while the yield of 10-year Treasuries declined towards 4.25%.

If USD/JPY stays below 147.00, it will head towards the 146.00 level. A move below 146.00 will open the way to the test of the support at 143.00 – 143.50.

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