U.S. Dollar Retreats On Dovish Powell: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Index Tests New Lows

U.S. Dollar Index is losing ground as traders react to Fed Chair Powell’s comments. Jerome Powell said that current rates were modestly restrictive. Traders believe that these remarks indicate that Fed is ready to cut rates.

Currently, U.S. Dollar Index is trying to settle below the support at 98.00 – 98.20. In case this attempt is successful, U.S. Dollar Index will move towards the next support level, which is located in the 96.70 – 96.90 range.

EUR/USD Gains Ground As Ifo Business Climate Report Beats Estimates

EUR/USD moved higher as traders focused on the Ifo Business Climate report from Germany. The report indicated that Business Climate increased from 87.5 in May to 88.4 in June, compared to analyst forecast of 88.2.

In case EUR/USD settles above the 1.1620 level, it will head towards the resistance level at 1.1675 – 1.1690.

GBP/USD Tests Resistance At 1.3620 – 1.3640

GBP/USD rallied as traders reacted to Powell’s comments and focused on the ceasefire between Israel and Iran, which increased investors’ appetite for riskier assets.

A successful test of the resistance at 1.3620 – 1.3640 will open the way to the test of the next resistance level at 1.3730 – 1.3750.

USD/CAD Pulls Back As Traders Ignore The Sell-Off In The Oil Markets

USD/CAD is losing some ground despite the strong pullback in the oil markets. Other commodity-related currencies are moving higher in today’s trading session.

If USD/CAD stays below the support level at 1.3725 – 1.3740, it will head towards the next support level at 1.3650 – 1.3665.

USD/JPY Retreats Amid Falling Treasury Yields

USD/JPY is under pressure as Treasury yields fall. Bond traders bet on dovish Fed after Powell’s remarks, which is bearish for USD/JPY.

The nearest support level for USD/JPY is located in the 143.50 – 144.00 range. A move below the 143.50 level will push USD/JPY towards the next support at 140.00 – 140.50.

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