U.S. Dollar Rebounds From Session Lows Amid U.S. – Canada Trade War: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Attempts To Rebound After Recent Pullback

U.S. Dollar Index moved away from session lows as traders focused on rising Treasury yields. The yield of 2-year Treasuries climbed towards the 4.40% level, while the yield of 10-year Treasuries settled near 4.80%.

I’d note that Bessent’s buyback efforts have so far failed to push yields of longer-dated bonds lower. The yield of 30-year Treasuries settled near 5.25%, close to the critical 5.30% level.

In case U.S. Dollar Index climbs above the 99.00 level, it will head towards the nearest resistance level, which is located in the 99.25 – 99.40 range.

EUR/USD Stays Above The 1.1600 Level

EUR/USD is mostly flat as traders focus on Germany’s Exports report. The report showed that Exports decreased by -0.8% month-over-month in July, compared to analyst forecast of 0%.

I believe that traders are already cautious ahead of the ECB Interest Rate Decision, which will be released on Thursday.

The nearest support level for EUR/USD is located in the 1.1600 – 1.1615 range. If EUR/USD manages to settle below the 1.1600 level, it will head towards the next support level at 1.1500 – 1.1515. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

GBP/USD Attempts To Settle Above 1.3565

GBP/USD continues its attempts to settle above the resistance level at 1.3550 – 1.3565 as traders focus on the BRC Retail Sales Monitor report from the UK. The report showed that Retail Sales increased by +0.5% year-over-year in August, compared to analyst forecast of +1.2%.

If GBP/USD manages to settle above the 1.3565 level, it will head towards the next resistance, which is located in the 1.3635 – 1.3650 range. On the support side, a move below the 50 MA at 1.3533 will push GBP/USD towards the next support at 1.3470 – 1.3485.

USD/CAD Rebounds From Session Lows

USD/CAD moved lower as traders focused on U.S. – Canada trade war. Canada’s Prime Minister Mark Carney said that counter-tariffs against the U.S. were necessary to protect Canadian businesses. Interestingly, the market does not believe that the trade war is a negative catalyst for the Canadian currency.

From the technical point of view, USD/CAD made an attempt to settle below the support level at 1.3750 – 1.3765 but lost momentum and rebounded towards the 1.3790 level. In case USD/CAD settles back above 1.3800, it will head towards the nearest resistance at 1.3825 – 1.3840. A successful test of this level will push USD/CAD towards the next resistance at 1.3900 – 1.3915.

USD/JPY Climbed Back Above 154.00 Amid Rising Treasury Yields

USD/JPY attempts to rebound after the strong sell-off as traders react to rising Treasury yields and focus on Japan’s second-quarter GDP Growth Rate report. The report showed that Japan’s GDP Growth Rate was +0.4%, in line with analyst estimates.

Traders try to guess whether BoJ is ready to intervene again at current levels or the Bank has finished its interventions. The expectations of a rate hike from the BoJ served as an additional bullish catalyst for the yen in recent trading sessions, but Fed may also raise rates at the meeting on September 16.

In case USD/JPY stays above the 154.00 level, it will head towards the resistance level at 155.00 – 155.50. A move above the 155.50 level will open the way to the test of the resistance level at 157.50 – 158.00.

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