U.S. Dollar Rebounds From Session Lows: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Moves Away From Session Lows

U.S. Dollar Index is mostly flat as traders react to the Initial Jobless Claims report. The report indicated that 200,000 Americans filed for unemployment benefits in a week, compared to analyst forecast of 205,000.

Oil prices have moved away from session lows, providing some support to the American currency.

The nearest resistance level for U.S. Dollar Index is located in the 98.00 – 98.15 range. If U.S. Dollar Index climbs above the 98.15 level, it will get to the test of the 50 MA at 98.35. A move above the 50 MA will open the way to the test of the resistance at 98.85 – 99.00.

EUR/USD Remains Stuck Near Resistance At 1.1765 – 1.1780

EUR/USD gained some ground as traders reacted to the better-than-expected Euro Area Retail Sales report. The report showed that Euro Area Retail Sales decreased by -0.1% month-over-month in March, compared to anlayst forecast of -0.3%.

In Germany, Factory Orders increased by +5% month-over-month in March, compared to analyst consensus of +1%. The surprising report provided support to the European currency.

Currently, EUR/USD is trying to settle above the resistance level at 1.1765 – 1.1780. If EUR/USD manages to settle above the 1.1780 level, it will move towards the next resistance at 1.1850 – 1.1865.

GBP/USD Retreats From Session Highs

GBP/USD pulled back from session highs as traders focused on local elections in the UK.

Traders also had a chance to take a look at the UK Construction PMI report. The report indicated that UK Construction PMI declined from 45.6 in March to 39.7 in April, compared to analyst consensus of 45.7.

The nearest support level for GBP/USD is located in the 1.3570 – 1.3585 range. A move below the 1.3570 level will push GBP/USD towards the 50 MA at 1.3552. If GBP/USD settles below the 50 MA, it will move towards the support level at 1.3450 – 1.3465.

USD/CAD Is Flat As Traders Focus On Middle East

USD/CAD remains stuck near the resistance level at 1.3620 – 1.3635 as traders monitor the dynamics of oil markets and wait for news from the Middle East.

In case USD/CAD manages to settle above 1.3635, it will move towards the resistance level at 1.3700 – 1.3715. RSI is in the moderate territory, so there is plenty of room to gain additional upside momentum in the near term.

On the support side, a move below the 1.3600 level will open the way to the test of the support level, which is located near May lows at 1.3535 – 1.3550.

USD/JPY Gains Ground As Treasury Yields Rise

USD/JPY is moving higher as traders shrug off intervention risks and focus on higher yields in the U.S. The yield of 2-year Treasuries climbed back towards the 3.90% level, while the yield of 10-year Treasuries settled above 4.37%.

If USD/JPY settles above the 156.00 level, it will head towards the key resistance level at 158.00 – 158.50. Yesterday, BoJ defended the 158.00 level and briefly pushed USD/JPY towards 155.00.

However, the yen is fundamentally weak, and traders are ready to use pullbacks as an opportunity to buy USD/JPY. The Bank of Japan cannot intervene on a daily basis as the yen would lose the status of a free-floating currency. USD/JPY bulls bet that BoJ will be forced to move away from the forex market after several unsuccessful attempts to defend the yen.

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