U.S. Dollar Moves Lower As Oil Pulls Back: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Retreats As Traders Stay Focused On Geopolitics

U.S. Dollar Index is losing some ground as traders react to JOLTs Job Openings report. The report indicated that JOLTs Job Openings declined from 6.922 million (revised from 6.882 million) to 6.866 million, compared to analyst forecast of 6.84 million.

ISM Services PMI declined from 54.0 in March to 53.6 in April, compared to analyst consensus of 53.7. Numbers above 50 show expansion.

New Home Sales increased by +7.4% month-over-month in March, while analysts expected that they would increase by +4.9%.

Better-than-expected reports did not provide support to the American currency as oil markets pulled back. Demand for safe-haven assets declined, which was bearish for the U.S. dollar.

In case U.S. Dollar Index stays below the 50 MA at 98.48, it will move towards the nearest support level at 98.00 – 98.15. A successful test of the support at 98.00 – 98.15 will open the way to the test of the next support at 97.35 – 97.50.

EUR/USD Attempts To Settle Above 1.1700

EUR/USD rebounds as traders focus on the pullback in the oil markets. Brent oil declined below the $111 level as U.S. said that ceasefire was in place despite Iran’s attack on UAE.

Currently, EUR/USD is trying to settle above the 50 MA at 1.1707. If EUR/USD manages to settle above the 50 MA, it will head towards the nearest resistance level, which is located in the 1.1765 – 1.1780 range.

GBP/USD Tests Resistance At 1.3570 – 1.3585

GBP/USD is moving higher, supported by rising demand for risk assets. There are no important economic reports scheduled to be released in the UK today, so traders will stay focused on general market sentiment.

From the technical point of view, GBP/USD attempts to settle above the resistance level at 1.3570 – 1.3585. In case this attempt is successful, GBP/USD will move towards the next resistance at 1.3650 – 1.3665. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

USD/CAD Remains Stuck Near 1.3620

USD/CAD continues its attempts to settle above the resistance at 1.3620 – 1.3635 despite the rebound in precious metals markets. Other commodity-related currencies are also moving higher in today’s trading session.

If USD/CAD settles above the 1.3635 level, it will head towards the resistance at 1.3700 – 1.3715. On the support side, a move below the 1.3600 level will open the way to the test of the support at 1.3535 – 1.3550.

USD/JPY Tests New Highs As Rebound Continues

USD/JPY climbed above the 157.50 level despite the pullback in Treasury yields. The yield of 2-year Treasuries declined below the 3.95% level, while the yield of 10-year Treasuries pulled back towards 4.40%.

From a big picture point of view, USD/JPY continues to rebound after recent intervention from the BoJ. The Japanese currency is fundamentally weak due to lower interest rates in Japan.

Most likely, BoJ will have to intervene again if the central bank wants to defend the yen. It remains to be seen whether Bank of Japan is ready for another intervention in the forex market.

The nearest resistance level for USD/JPY is located in the 158.00 – 158.50 range. A move above the 158.50 level will push USD/JPY towards the psychologically important 160.00 level. If USD/JPY climbs above 160.00, it will head towards the resistance at 161.50 – 162.00.

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