U.S. Dollar Tests New Highs As Retail Sales Rise 0.5%: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Moves Higher As Retail Sales Meet Analyst Estimates

U.S. Dollar Index gains ground as traders react to the Retail Sales report. The report indicated that Retail Sales increased by +0.5% month-over-month in April, in line with analyst consensus. Retail Sales Ex Autos increased by +0.7%, compared to analyst forecast of +0.6%.

Today, traders also had a chance to take a look at the Initial Jobless Claims report. The report showed that 211,000 Americans filed for unemployment benefits in a week, compared to analyst forecast of +205,000.

The nearest resistance level for U.S. Dollar Index is located in the 98.85 – 99.00 range. A successful test of this level will open the way to the test of the next resistance at 99.70 – 99.85.

EUR/USD Tests Support At 1.1665 – 1.1680

EUR/USD is losing ground as traders focus on general strength of the U.S. dollar and monitor the dynamics of oil markets. Oil prices pulled back as traders reacted to Trump – Xi meeting in Beijing. This move did not provide support to EUR/USD as traders have mostly focused on U.S. economic data.

Currently, EUR/USD is trying to settle below the support level at 1.1665 – 1.1680. In case this attempt is successful, EUR/USD will head towards the next support level, which is located in the 1.1585 – 1.1600 range. RSI is close to the oversold territory, but there is enough room to gain additional downside momentum in the near term.

GBP/USD Is Under Pressure Amid Political Crisis In The UK

GBP/USD is losing ground despite the better-than-expected UK GDP Growth Rate report. The report showed that UK GDP Growth Rate was +1.1% in the first quarter, compared to analyst consensus of +0.8%.

Political turmoil in the UK puts pressure on the British pound. Today, Health Secretary Wes Streeting resigned, telling Prime Minister Keir Starmer that he “will not lead the Labour Party into the next general election”.

GBP/USD attempts to settle below the support level at 1.3450 – 1.3465. If GBP/USD manages to settle below the 1.3450 level, it will move towards the next support, which is located in the 1.3335 – 1.3350 range.

USD/CAD Tests New Highs As Precious Metals Pull Back

USD/CAD tests new highs as traders focus on the pullback in precious metals markets. Silver prices are down by more than 3% as traders rush to take profits after the recent rally. Other commodity-related currencies have also found themselves under pressure in today’s trading session.

If USD/CAD stays above the resistance at 1.3700 – 1.3715, it will head towards the next resistance level, which is located in the 1.3775 – 1.3790 range. On the support side a move below the 1.3700 level will push USD/CAD towards the 50 MA at 1.3728.

USD/JPY Attempts To Settle Above 158.00

USD/JPY gained some ground in a choppy trading session as traders suspected potential intervention from the Bank of Japan.

USD/JPY has briefly touched the 157.30 level but quickly moved back above 158.00. The scale of the move does not necessarily point to the intervention as the central bank has previously operated at a larger scale. However, the BoJ may have changed its strategy and is trying to scare speculators.

Anyway, USD/JPY has already moved towards session highs and is trying to settle above the resistance at 158.00 – 158.50. In case this attempt is successful, USD/JPY will head towards the 160.00 level.

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