U.S. Dollar Pulls Back From Session Highs As Traders Stay Focused On Yen Intervention: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Retreats From Session Highs

U.S. Dollar Index is swinging between gains and losses as traders react to the final reading of Michigan Consumer Sentiment report. The report indicated that Consumer Sentiment increased from 49.5 in June to 55.2 in July, compared to analyst forecast of 54.0.

Currently, U.S. Dollar Index is trying to settle below the support at 99.85 – 100.00. If U.S. Dollar Index manages to settle below the 99.85 level, it will head towards the next support, which is located in the 99.25 – 99.40 range. RSI has recently moved back into moderate territory, so there is enough room to gain additional downside momentum in the near term.

EUR/USD Rebounds Above The 1.1500 Level

EUR/USD rebounded from session lows as traders remained focused on inflation data from the EU. Euro Area Inflation Rate increased from 2.8% in June to 2.9% in July, in line with analyst estimates. Euro Area Core Inflation Rate increased from 2.4% to 2.5%, while analysts expected that it would remain unchanged at 2.4%.

From the technical point of view, EUR/USD continues its attempts to settle above the resistance level at 1.1510 – 1.1525. If EUR/USD manages to settle above the 1.1525 level, it will move towards the next resistance at 1.1600 – 1.1615.

GBP/USD Tests Resistance At 1.3465 – 1.3480

GBP/USD is mostly flat as traders react to the UK Nationwide Housing Prices report. The report showed that housing prices increased by +0.1% month-over-month in July, in line with analyst consensus.

Currently, GBP/USD attempts to settle above the resistance at 1.3465 – 1.3480. In case this attempt is successful, GBP/USD will head towards the next resistance level, which is located in the 1.3550 – 1.3565 range.

USD/CAD Gains Ground As Precious Metals Markets Pull Back

USD/CAD is moving higher as traders react to the pullback in precious metals markets. Gold pulled back below the $4050 level, while silver declined below $57.50. Other commodity-related currencies are losing some ground in today’s trading session.

If USD/CAD manages to settle below the support at 1.4010 – 1.4025, it will head towards the next support level at 1.3920 – 1.3935.

USD/JPY Stays Volatile After BoJ Intervention

USD/JPY is jumping back and forth in volatile trading after yesterday’s intervention from the Bank of Japan. According to Bloomberg’s estimate, Japan spent about $53 billion to provide support to the national currency. It should be noted that Japanese officials did not confirm the intervention.

Today, traders also focused on BoJ Interest Rate Decision. Normally, the rate decision would be the key event of the week, but the massive intervention served as a more important catalyst.

The Bank of Japan left the interest rate unchanged at 1%, in line with analyst estimates. One board member voted for a hike.

In case USD/JPY settles below the support at 159.50 – 160.00, it will head towards the next support level at 157.50 – 158.00. BoJ may try to intervene again as the yen is fundamentally weak. The currency requires additional support to break the current trend. In case BoJ does not intervene, USD/JPY bulls may calm down and push USD/JPY back above the 160.00 level.

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