U.S. Dollar Moves Higher As Composite PMI Exceeds Estimates: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Moves Higher As Traders Focus On PMI Reports

U.S. Dollar Index gains ground as traders focus on PMI report. Manufacturing PMI increased from 51.6 in February to 52.4 in March, compared to analyst forecast of 51.3. Services PMI declined from 51.7 to 51.1, compared to analyst consensus of 51.5. Numbers above 50 show expansion.

Composite PMI declined from 51.9 to 51.4 but exceeded analyst expectations despite the weaker-than-expected Services PMI report.

Currently, U.S. Dollar Index attempts to settle above the 99.50 level. In case this attempt is successful, U.S. Dollar Index will move towards the nearest resistance level, which is located in the 99.70 – 99.85 range.

EUR/USD Pulled Back Below 1.1600

EUR/USD pulled back as traders focused on the disappointing PMI data from the EU. Euro Area Manufacturing PMI increased from 50.8 in February to 51.4 in March, compared to analyst forecast of 49.4. Services PMI declined from 51.9 to 50.1, while analysts expected that it would drop to 51.1.

The weakness of the services sector put significant pressure on the Composite PMI, which moved from 51.9 to 50.5. Traders are worried that Composite PMI will drop below the 50 level in the upcoming months due to high energy prices.

From the technical point of view, EUR/USD remains stuck near resistance at 1.1585 – 1.1600. If EUR/USD manages to settle above the 1.1600 level, it will move towards the next resistance at 1.1665 – 1.1680.

GBP/USD Retreats As UK Services PMI Misses Estimates

GBP/USD moved lower as traders reacted to PMI reports from the UK. Manufacturing PMI declined from 51.7 in February to 51.4, while Services PMI decreased from 53.9 to 51.2.

GBP/USD failed to settle above the resistance at 1.3400 – 1.3415 and made an attempt to settle below the 1.3370 level. If GBP/USD declines below 1.3370, it will move towards the nearest support level, which is located in the 1.3315 – 1.3330 range.

USD/CAD Gains Ground As Traders Ignore The Rally In The Oil Markets

USD/CAD is moving higher as traders ignore the rally in the oil markets. WTI oil climbed above the $92.00 level amid reports indicating that Gulf countries could join the military operation against Iran.

Other commodity-related currencies have also found themselves under pressure in the today’s trading session.

USD/CAD climbed above the resistance at 1.3720 – 1.3735 and is trying to settle above the 1.3750 level. In case this attempt is successful, USD/CAD will move towards the next resistance level, which is located in the 1.3800 – 1.3815 range.

USD/JPY Rebounds As Treasury Yields Rise

USD/JPY moved higher as traders focused on economic reports from Japan and dynamics of Treasury yields.

Japan’s Inflation Rate declined from 1.5% in January to 1.3% in February, in line with analyst estimates. Core Inflation Rate decreased from 2% to 1.6%, while analysts expected that it would drop to 1.7%.

Today, traders also had a chance to take a look at PMI data from Japan. Manufacturing PMI decreased from 53.0 in February to 51.4 in March, compared to analyst forecast of 52.8. Services PMI pulled back from 53.8 to 52.8, compared to analyst consensus of 51.5.

Treasury yields gained ground as traders focused on Middle East tensions and bet that oil prices will stay high in the upcoming weeks.

In case USD/JPY settles above the 50 MA at 159.05, it will move towards recent highs near the 160.00 level. A move above 160.00 will open the way to the test of the resistance at 161.50 – 162.00.

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