U.S. Dollar Moves Higher Despite Hopes For Iran Deal: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Moves Higher As Traders Ignore The Sell-Off In The Oil Markets

U.S. Dollar Index gains ground as traders focus on news from the Middle East. Oil prices are down by -3.8% as traders bet that U.S. and Iran will reach a deal soon. That said, there are many conflicting reports about negotiations, and it remains to be seen whether the Strait of Hormuz will be reopened in the near term.

U.S. has recently denied an Iranian report which indicated that the sides have managed to create a draft interim peace deal that would unblock the Strait of Hormuz.

Currently, U.S. Dollar Index is trying to settle above the 50 MA at 99.17. In case this attempt is successful, it will head towards the 99.50 level. A move above 99.50 will open the way to the test of the resistance at 99.75 – 99.90.

EUR/USD Retreats From Session Highs

EUR/USD declined from session highs despite the pullback in the oil markets. From a big picture point of view, traders stay cautious amid geopolitical uncertainty.

EUR/USD failed to settle above the resistance at 1.1665 – 1.1680 and pulled back towards the 50 MA at 1.1625. If EUR/USD settles below the 50 MA at 1.1625, it will head towards the nearest support level, which is located in the 1.1585 – 1.1600 range.

GBP/USD Tests New Lows

GBP/USD is moving lower as pullback continues. Interestingly, falling oil prices did not boost demand for risk assets. It looks that traders are worried about the long-term impact of the current situation in the Strait of Hormuz.

From the technical point of view, GBP/USD is trying to settle below the 50 MA at 1.3425. In case this attempt is successful, GBP/USD will move towards the support level at 1.3335 – 1.3350.

USD/CAD Gains Ground As Traders React To The Pullback In Precious Metals Markets

USD/CAD tested new highs as traders reacted to the strong pullback in precious metals markets. Gold is down by -1.4%, while silver is down by almost -3% as traders worry that global central banks will be forced to raise rates to fight inflation.

The nearest resistance level for USD/CAD is located in the 1.3860 – 1.3875. A successful test of this level will push USD/CAD towards the next resistance level at 1.3935 – 1.3950. RSI remains in the moderate territory, so there is plenty of room to gain momentum.

USD/JPY Tests The 159.50 Level

USD/JPY continues to move higher as traders bet on hawkish Fed. Treasury yields are losing some ground in today’s trading session. The yield of 2-year Treasuries settled near the 4.03% level, while the yield of 10-year Treasuries pulled back towards 4.48%.

Falling Treasury did not put any pressure on USD/JPY, which indicates that traders remain bullish. It should be noted that USD/JPY is moving slowly due to risks of interventions from the BoJ.

Currently, USD/JPY is trying to settle above the 159.50 level. In case this attempt is successful, USD/JPY will head towards the key 160.00 level. A move above 160.00 will push USD/JPY towards the resistance level at 161.50 – 162.00.

On the support side, a move below the 50 MA at 159.02 will push USD/JPY towards the support at 158.00 – 158.50.

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