U.S. Dollar Gains Ground On Tariff Threat: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

By:

Vladimir Zernov

Published: Jan 28, 2025, 17:00 GMT+00:00

Key Points:

EUR/USD tests support at 1.0420 - 1.0435 as traders focus on tariff threat.
USD/CAD continues its attempts to settle above the 1.4400 level as demand for commodity-related currencies declines.
USD/JPY is moving higher as Treasury yields rise.

In this article:

EUR/USD

GBP/USD

USD/CAD

USD/JPY

U.S. Dollar Rebounds From Multi-Week Lows

DXY 280125 4h Chart

U.S. Dollar Index is moving higher as traders react to the disappointing Durable Goods Orders report. The report showed that Durable Goods Orders declined by 2.2% month-over-month in December, compared to analyst forecast of +0.6%.

In case U.S. Dollar Index climbs back above the 108.00 level, it will move towards the nearest resistance level, which is located in the 108.30 – 108.50 range.

EUR/USD Is Under Pressure As Traders Focus On Trump’s Tariff Plans

EUR/USD 280125 4h Chart

EUR/USD is losing ground as Trump said that he wanted to impose a universal tariff that is “much bigger” than 2.5%. Tariffs are bullish for the U.S. dollar.

Currently, EUR/USD is trying to settle below the support at 1.0420 – 1.0435. In case this attempt is successful, EUR/USD will move towards the next support level, which is located in the 1.0335 – 1.0350 range.

GBP/USD Is Heading Towards The 1.2400 Level

GBP/USD 280125 4h Chart

GBP/USD moved lower as traders focused on the outlook for Trump’s tariff policy. Traders will likely stay focused on this important catalyst in the upcoming trading sessions.

In case GBP/USD settles below the recent lows near 1.2415, it will move towards the next support level, which is located in the 1.2355 – 1.2370 range.

USD/CAD Tests The 1.4400 Level Amid Falling Demand For Commodity-Related Currencies

USD/CAD 280125 4h Chart

USD/CAD continues its attempts to settle above the 1.4400 level despite the rebound in gold markets. Other commodity-related currencies have also found themselves under pressure due to tariff threats.

A move above the 1.4400 level will provide USD/CAD with an opportunity to gain additional upside momentum and move towards the nearest resistance at 1.4540 – 1.4560.

USD/JPY Moved Above 155.50 Amid Rising Treasury Yields

USD/JPY 280125 4h Chart

USD/JPY gains ground as traders react to rising Treasury yields. The yield of 2-year Treasuries climbed above the 4.22% level, while the yield of 10-year Treasuries settled above 4.57%.

In case USD/JPY settles above the resistance at 156.00 – 156.50, it will head towards the next resistance level at 158.00 – 158.50.

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.