U.S. Dollar Rebounds From Session Lows Despite Falling Treasury Yields: 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 Existing Home Sales report. The report indicated that Existing Home Sales increased by +3.2% month-over-month in May, compared to analyst forecast of +0.5%.

Traders also focused on the developments in the oil markets. WTI oil is down by -5% as traders continue to prepare for the potential deal between the U.S. and Iran.

Currently, U.S. Dollar Index is trying to settle back above the resistance at 99.70 – 99.85. 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.

EUR/USD Pulls Back From Session Highs

EUR/USD gained some ground as traders focused on the Industrial Production report from Germany. The report indicated that Industrial Production increased by +0.4% month-over-month in April, in line with analyst estimates.

It should be noted that ECB will release its Interest Rate Decision on Thursday, so traders have already started to prepare for this important event.

EUR/USD moved away from session highs and is trying to gain downside momentum. The nearest support level for EUR/USD is located in the 1.1500 – 1.1515 range. A move below the 1.1500 level will push EUR/USD towards the next support at 1.1450 – 1.1430.

GBP/USD Gains Ground As UK Retail Sales Exceed Estimates

GBP/USD moved away from session highs despite the strong pullback in the oil markets. Traders also focused on the BRC Retail Sales Monitor report for May. The report indicated that Retail Sales increased by +3.4% year-over-year, compared to analyst forecast of +0.6%.

Currently, GBP/USD is moving towards the support level at 1.3335 – 1.3350. In case GBP/USD declines below the 1.3335 level, it will head towards the next support, which is located in the 1.3215 – 1.3230 range. RSI is in the moderate territory, so there is plenty of room to gain additional downside momentum in the near term.

USD/CAD Tests Resistance At 1.3950 – 1.3965

USD/CAD continues its attempts to settle above the resistance at 1.3950 – 1.3965 as traders focus on the strong pullback in precious metals markets. Gold is down by -1.8%, while silver declined by -5%. Other commodity-related currencies are also moving lower in today’s trading session.

A successful test of the resistance at 1.3950 – 1.3965 will push USD/CAD towards the next resistance level at 1.4035 – 1.4050. On the support side, a move below 1.3920 will open the way to the test of the support level at 1.3860 – 1.3875.

USD/JPY Tests New Highs

USD/JPY gains ground in absence of interventions from the Bank of Japan. Treasury yields are moving lower, but this move does not put pressure on USD/JPY. The yield of 2-year Treasuries declined towards the 4.13% level, while the yield of 10-year Treasuries settled below 4.55%.

In case USD/JPY manages to settle above the 160.50 level, it will head towards the nearest resistance level, which is located in the 161.50 – 162.00 range. RSI is close to the overbought territory, but there is enough room to gain additional momentum in the near term.

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