U.S. Dollar Rebounds As ISM Manufacturing PMI Exceeds Estimates: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Moves Higher As Traders React To ISM Manufacturing PMI Report

U.S. Dollar Index gains ground as traders focus on the better-than-expected ISM Manufacturing PMI report. The report indicated that ISM Manufacturing PMI increased from 53.3 in June to 55.6 in July, compared to analyst forecast of 54. ISM Manufacturing Employment grew from 49.7 to 52.8, compared to analyst consensus of 49.8. Numbers above 50 show expansion.

Currently, U.S. Dollar Index is trying to settle above the resistance level at 99.85 – 100.00. In case this attempt is successful, U.S. Dollar Index will move towards the next resistance level, which is located in the 100.50 – 100.65 range. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

EUR/USD Pulls Back As Germany’s Retail Sales Miss Estimates

EUR/USD is losing ground as traders react to the disappointing Retail Sales report from Germany. The report showed that Retail Sales decreased by -1.1% month-over-month in June, compared to analyst forecast of -0.5%.

From the technical point of view, EUR/USD made an attempt to settle above the resistance level at 1.1510 – 1.1525 but failed to develop sufficient upside momentum and pulled back towards the 1.1500 level. In case EUR/USD manages to settle below 1.1500, it will head towards the next support, which is located in the 1.1420 – 1.1435 range.

GBP/USD Moves Lower Amid Profit-Taking

GBP/USD pulls back as traders take some profits off the table after the strong rally and react to ISM Manufacturing PMI report from the U.S.

A move below the 1.3400 level will open the way to the test of the support level at 1.3335 – 1.3350. On the upside, GBP/USD needs to settle above the resistance level at 1.3465 – 1.3480 to have a chance to gain upside momentum in the near term. If GBP/USD climbs above 1.3480, it will head towards the resistance level at 1.3550 – 1.3565.

USD/CAD Gains Ground As Demand For Commodity-Related Currencies Declines

USD/CAD is moving higher as traders focus on the pullback in precious metals markets. Other commodity-related currencies are also losing ground in today’s trading session.

USD/CAD climbed above the support level at 1.4010 – 1.4025 and is trying to settle above the 1.4050 level. In case this attempt is successful, USD/CAD will move towards the 50 MA at 1.4070. If USD/CAD manages to settle above the 50 MA, it will head towards the resistance level at 1.4125 – 1.4140.

USD/JPY Moves Away From Session Lows

USD/JPY attempts to rebound after interventions from Japan and U.S. It is not clear how mcuh U.S. spent to provide support to the yen, but Treasury Secretary Scott Bessent said that the country would not hesitate to get back into the market.

U.S. officials decided to intervene as Japan could be forced to sell U.S. Treasuries to raise money for currency interventions. The yield of 30-year Treasuries is at multi-decade highs, and additional pressure from Japan’s sales could trigger a major sell-off in U.S. bond markets.

If USD/JPY climbs above the 157.00 level, it will move towards the resistance level at 157.50 – 158.00. A successful test of this level will open the way to the test of the next resistance at 159.50 – 160.00.

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