U.S. Dollar Rallies As Traders Focus On Inflation Data: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Tests New Highs

U.S. Dollar Index rallied as traders reacted to inflation reports. Inflation Rate increased from 2.4% in May to 2.7% in June, in line with analyst estimates. Core Inflation Rate grew from 2.8% to 2.9%, compared to analyst consensus of 3%. It looks that traders believed that inflation numbers would be lower.

In case U.S. Dollar Index settles above the 98.50 level, it will head towards the resistance level at 99.20 – 99.40.

EUR/USD Pulls Back As Traders React To U.S. Inflation Reports

EUR/USD pulled back as traders focused on U.S. inflation data and reacted to Euro Area Economic Sentiment Index report. The report showed that Economic Sentiment increased from 35.3 in June to 36.1 in July, compared to analyst forecast of 37.8.

The nearest support level for EUR/USD is located in the 1.1575 – 1.1590 range. A move below the 1.1575 level will push EUR/USD towards the next support at 1.1450 – 1.1465.

GBP/USD Tests Support At 1.3370 – 1.3390

GBP/USD is under pressure as traders focus on general strength of the American currency.

A move below the 1.3370 level will push GBP/USD towards the next support level at 1.3250 – 1.3270. RSI is in the oversold territory, so the risks of a rebound are increasing.

USD/CAD Gains Ground As Commodity Markets Move Lower

USD/CAD moved higher as traders reacted to the pullback in commodity markets. Other commodity-related currencies are also losing ground in today’s trading session.

A successful test of the resistance at 1.3735 – 1.3750 will open the way to the test of the next resistance level at 1.3845 – 1.3860.

USD/JPY Rallies As Treasury Yields Rise

USD/JPY tested new highs as Treasury yields rallied after the release of U.S. inflation reports.

If USD/JPY stays above the resistance at 147.50 – 148.00, it will move towards the next resistance level at 151.00 – 151.50.

For a look at all of today’s economic events, check out our economic calendar.