US Dollar Price Forecast: DXY Holds $98.50 After Hot CPI — Can GBP/USD and EUR/USD Hold Support?

Dollar Strengthens as Hotter Inflation Data Dampens Rate-Cut Expectations

The dollar rose against a basket of major currencies on May 13, 2026, after U.S. inflation was hotter than expected for April, suggesting that inflation is likely to remain sticky. The headline and core figures in the inflation report were above analysts’ expectations for April, helped by a jump in shelter costs and a jump in energy prices back in February.

The report put renewed pressure on the euro, as it lowered expectations for the Federal Reserve to cut rates before the ECB. The pound also traded cautiously, amid investors awaiting U.K. economic data. The conditional truce between the U.S. and Iran has reduced the safe-haven appeal of the dollar in recent weeks.

However, the latest U.S. inflation data suggests that policymakers are not yet at the point to ease monetary policy. The dollar will remain on the lookout for both a cooling job market and persistent price pressures. While the greenback may remain supported if further signs of sticky prices appear in coming U.S. economic reports, the greenback could fall later this year if U.S. inflation data starts to cool more convincingly than before.

DXY Holds $98.50 – White Descending Channel Resistance Tested

DXY holds at $98.50 and puts the resistance of a white descending channel to the test. On the 4h chart, DXY is at $98.50 and bounces off the white descending trendline that started from the April highs by printing long upper wicks. The pair also tests a red MA50 located around $98.59. The pair prints some green candlesticks that have small bullish bodies but can’t clear the overhead supply.

The price respects the lower highs structure and stays above a blue support line at $98.00 and a horizontal support line at $98.09 while printing higher lows as well as inside a short-term base.

RSI is around 52 and neutral without any sign of divergence. The next resistance is located within a cluster formed by a $98.59 to $99.07 Fib retracement area that projects resistance from the May swing. The pair prints volume around the $98.50 price area as an immediate pivot with sellers continuing to defend the ceiling of the descending channel. The price remains in a range-bound structure below $98.59 while staying inside a multi-week-long down-channel.

Trade idea: Sell $98.50 targeting $98.09, stop $98.59.

GBP/USD Pulls Back to $1.351 – Rising Channel Floor Defended

GBP/USD falls back to the $1.351 level as price puts the support of a rising channel to the test. On the 2h chart, the pair is at $1.3513 and tests a white ascending trendline that started from the early May lows. The price recently rejected a red MA50 around $1.3535 by printing green rejection wicks that defend a 50% Fib support around $1.35099 while printing higher lows and stays inside an ascending channel. The price remains in the distribution price zone above $1.353.

However, the pair puts a rising channel support to the test by testing its channel floor. RSI is at 52 and stays neutral to confirm that the momentum remains steady. The next resistance lies in a $1.3557 to $1.3577 area formed by Fib retracement zones. The price area where most volume prints is $1.351 as a fair value pivot as the buyers step into buy the dips. The price remains in a bullish structure in the $1.3513+ price range as the pair prints higher lows and higher highs while staying inside a clean rising channel.

Trade idea: Buy $1.3513 targeting $1.3557, stop $1.3500.

EUR/USD Grinds $1.171 – Blue Ascending Trendline Support

EUR/USD grinds the $1.171 level as price puts the support of a blue ascending trendline to the test. On the 2h chart, EUR/USD is at $1.1712 and defends a blue ascending trendline that started from the mid-April lows while printing some mixed candlesticks. The price holds a $1.169 price level as support and prints a red moving average near $1.173 as an immediate dynamic resistance. It also prints higher lows after hitting a confluence formed by a 38.2% Fib retracement area from the most recent swing.

The price also prints a bullish hammer that shows the presence of buyer interest inside the price zone. RSI is around 50 and neutral without a sign of divergence. The price needs to clear some overhead resistance levels in the $1.174 to $1.178 area prior swing highs to the upside.

The volume profile shows the strongest price area around $1.171 as an immediate pivot. The price remains in a neutral to bullish structure in the $1.1712+ price zone while staying inside a clean channel as it defends a rising support trendline on the floor.

Trade idea: Buy $1.1712 targeting $1.174, stop $1.169.