U.S. Dollar Moves Higher As Traders Bet On Rate Hikes
U.S. Dollar Index gains ground as traders focus on Producer Prices data. PPI increased by +0.3% month-over-month in October, compared to analyst forecast of +0.4%. Core PPI grew by +0.3%, in line with analyst estimates.
Currently, U.S. Dollar Index is trying to settle above the resistance at 103.15 – 103.30. In case this attempt is successful, U.S. Dollar Index will head towards the next resistance level, which is located in the 104.60 – 104.75 range. I’d note that RSI is in the overbought territory, so the risks of a pullback are increasing.
EUR/USD Retreats As Pullback Continues
EUR/USD is losing ground as traders focus on Germany’s Wholesale Prices report. The report showed that Wholesale Prices increased by +0.4% month-over-month in October, compared to analyst estimate of +0.4%. On a year-over-year basis, Wholesale Prices increased by +8.8%.
EUR/USD attempts to settle below the support level at 1.1015 – 1.1030. If EUR/USD manages to settle below the 1.1015 level, it will head towards the next support, which is located in the 1.0935 – 1.0950 range.
GBP/USD Remains Under Pressure
GBP/USD is moving lower as traders stay focused on hawkish Fed policy outlook. According to FedWatch Tool, there is a 91.7% probability that Fed will raise the federal funds rate by 25 bps at the next meeting in December.
The nearest support level for GBP/USD is located in the 1.3185 – 1.3200 range. If GBP/USD pulls back below the 1.3185 level, it will head towards the next support at 1.3125 – 1.3140. RSI is in the oversold territory, so the risks of a rebound are increasing.
EUR/USD Price Forecast
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See all EUR/USD forecastsUSD/CAD Stays Range-Bound Despite Falling Demand For Commodity-Related Currencies
USD/CAD is swinging between gains and losses as traders wait for additional catalysts. Oil prices are mostly flat in today’s trading session. Other commodity-related currencies moved lower today.
In case USD/CAD settles back above the 1.4250 level, it will head towards the nearest resistance level at 1.4275 – 1.4290. A move above the 1.4290 level will open the way to the test of the resistance at 1.4385 – 1.4400.
On the support side, USD/CAD needs to settle below 1.4225 to have a chance to gain downside momentum in the near term. In this case, USD/CAD will head towards the support at 1.4155 – 1.4170. A move below 1.4155 will push USD/CAD towards the 50 MA at 1.4116.
USD/JPY Is Stuck Near The 160.00 Level
USD/JPY continues its attempts to settle above the psychologically important 160.00 level despite pullback in Treasury yields. The yield of 2-year Treasuries declined below the 4.85% level, while the yield of 10-year Treasuries settled below 5.13%.
The Japanese yen remains fundamentally weak but traders are worried that BoJ may intervene in case USD/JPY climbs above the 160.00 level and moves towards the 162.00 level. I’d also note that RSI is in the overbought territory, so the risks of a pullback are increasing.
If USD/JPY settles above 160.50, it will head towards the resistance at 162.00 – 162.50. On the support side, a move below the 159.50 level will push USD/JPY towards the 50 MA at 158.68.
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