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U.S. Dollar Gains Ground As Inflation Expectations Increase: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY
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Key Points:
- EUR/USD pulled back below the 1.0350 level as traders reacted to the weak Industrial Production report from Germany.
- USD/CAD remained stuck near the 1.4300 level as traders waited for stronger catalysts.
- USD/JPY tested new lows despite rising Treasury yields.
U.S. Dollar Gains Ground After Michigan Consumer Sentiment Report
U.S. Dollar Index gains ground as traders react to Michigan Consumer Sentiment report, which indicated that year-ahead inflation expectations increased from 3.3% in January to 4.3% in February.
The nearest resistance level for U.S. Dollar Index is located in the 108.30 – 108.50 range. A move above the 108.50 level will push U.S. Dollar Index towards the next resistance at 109.20 – 109.40.
EUR/USD Retreats As Germany’s Industrial Production Remains Under Strong Pressure
EUR/USD is losing ground as traders react to the disappointing Industrial Production report from Germany. The report showed that Germany’s Industrial Production decreased by 2.4% month-over-month in December, compared to analyst forecast of -0.6%.
If EUR/USD settles below the support at 1.0335 – 1.0350, it will move towards the next support level, which is located in the 1.0200 – 1.0215 range.
GBP/USD Pulled Back Below 1.2400
GBP/USD atempts to settle below the 1.2400 level as traders focus on U.S. economic data.
If GBP/USD stays below the 1.2400 level, it will move towards the nearest support at 1.2355 – 1.2370. RSI is in the moderate territory, and there is plenty of room to gain momentum in case the right catalysts emerge.
USD/CAD Is Mostly Flat As Consolidation Continues
USD/CAD remains stuck below the resistance at 1.4330 – 1.4350 as traders react to the better-than-expected Employment Change report from Canada. From a big picture point of view, USD/CAD consolidates after the recent pullback.
If USD/CAD climbs above the 1.4350 level, it will head towards the 50 MA at 1.4414.
USD/JPY Remains Under Pressure As Traders Bet On Hawkish BoJ
USD/JPY tested new lows as traders remained focused on hawkish comments from the BoJ. Rising Treasury yields did not provide support to USD/JPY in today’s trading session.
In case USD/JPY settles below the 151.50 level, it will head towards the next support, which is located in the 148.50 – 149.00 range.
For a look at all of today’s economic events, check out our economic calendar.
About the Author
Vladimir Zernovauthor
In more than 15 years of trading in the financial markets, Vladimir dealt with a wide range of brokers and financial instruments. His career as a day-trader at a proprietary trading firm goes back to 2007. Later, Vladimir turned to longer time frames and became an independent trader and analyst managing his own portfolio. Using his experience, he helps traders find the best broker in his reviews.
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