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U.S. Dollar Retreats As Treasury Yields Decline: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY
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Key Points:
- EUR/USD gained ground as traders reacted to economic reports from the U.S.
- USD/CAD settled near the key resistance at 1.3890 - 1.3905 despite the strong rally in precious metals markets.
- USD/JPY pulled back amid falling Treasury yields.
U.S. Dollar Pulls Back As Traders Focus On PPI Report
U.S. Dollar Index pulls back as traders react to Producer Prices data for October and November. PPI increased by +0.1% month-over-month in October, compared to analyst forecast of +0.3%. PPI grew by +0.2% in November, in line with analyst estimates.
From the technical point of view, U.S. Dollar Index needs to stay above the resistance at 98.85 – 99.00 to have a chance to gain additional upside momentum in the near term.
EUR/USD Attempts To Rebound
EUR/USD gains ground as traders focus on U.S. economic data. The better-than-expected U.S. Retail Sales report did not provide support to the American currency. The report indicated that Retail Sales increased by +0.6% month-over-month in November, compared to analyst forecast of +0.4%.
In case EUR/USD climbs above the 50 MA at 1.1674, it will move towards the resistance at 1.1715 – 1.1730.
GBP/USD Is Heading Towards The 1.3475 Level
GBP/USD moved higher as traders focused on general weakness of the American currency.
If GBP/USD climbs above the resistance level at 1.3475 – 1.3490, it will head towards the next resistance level, which is located in the 1.3575 – 1.3590 range.
USD/CAD Is Stuck Below The Resistance At 1.3890 – 1.3905
USD/CAD remains stuck near resistance at 1.3890 – 1.3905 despite the strong rally in precious metals markets.
A move above the 1.3905 level will push USD/CAD towards the next resistance at 1.3980 – 1.3995.
USD/JPY Retreats As Treasury Yields Fall
USD/JPY pulled back from multi-month highs as traders focused on falling Treasury yields and rushed to take profits after the strong rally. The yield of 2-year Treasuries declined towards the 3.50% level, while the yield of 10-year Treasuries pulled back below 4.15%.
In case USD/JPY declines below the 50 MA at 157.42, it will move towards the support at 154.50 – 155.00.
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About the Author
Vladimir Zernovauthor
Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.
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