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

U.S. Dollar Index Faced Resistance Near 98.60

U.S. Dollar Index made an attempt to rebound but lost momentum and pulled back from session highs.

The nearest support level for U.S. Dollar Index is located in the 98.00 – 98.15 range. A successful test of this level will push U.S. Dollar Index towards the next support at 97.35 – 97.50.

EUR/USD Attempts To Gain Upside Momentum

EUR/USD is mostly flat as traders react to the disappointing Ifo Business Climate report from Germany. The report showed that Ifo Business Climate declined from 88.0 in November to 87.6 in December, compared to analyst forecast of 88.2.

In case EUR/USD settles back above the 1.1750 level, it will head towards the nearest resistance, which is located in the 1.1805 – 1.1820 range.

GBP/USD Moved Lower As UK Inflation Rate Declined To 3.2%

GBP/USD pulled back as traders focused on inflation reports from the UK. Inflation Rate declined from 3.6% in October to 3.2% in November, compared to analyst consensus of 3.5%. Core Inflation Rate decreased from 3.4% to 3.2%, compared to analyst forecast of 3.4%. The lower-than-expected inflation may provide BoE with an opportunity to cut rates, which is bearish for British pound.

If GBP/USD manages to settle above the resistance level at 1.3360 – 1.3375, it will move towards the next resistance at 1.3475 – 1.3490.

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

USD/CAD gains ground despite the rally in commodity markets. Other commodity-related currencies are also losing ground in today’s trading session.

A move above the 50 MA at 1.3800 will lead to the test of the resistance level at 1.3815 – 1.3830.

USD/JPY Tests The 50 MA At 155.61

USD/JPY is moving higher despite the better-than-expected Exports report from Japan. The report showed that Exports increased by +6.1% year-over-year in November, compared to analyst forecast of 4.8%. The weak yen provided material support to Japan’s exports.

In case USD/JPY climbs above the 50 MA at 155.61, it will head towards recent highs near the 157.00 level.

For a look at all of today’s economic events, check out our economic calendar.