U.S. Dollar Rebounds As Traders Weigh Inflation Data: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

U.S. Dollar Is Volatile After Inflation Reports

U.S. Dollar Index managed to rebound after sell-off as traders reacted to inflation data. Inflation Rate increased from 2.7% in November to 2.9% in December, in line with analyst estimates. Core Inflation Rate declined from 3.3% to 3.2%, while analysts expected that it would remain unchanged.

The nearest resistance level for U.S. Dollar Index is located in the 109.40 – 109.60 range. A move above the 109.60 level will push U.S. Dollar Index towards the next resistance level at 111.10 – 111.30.

EUR/USD Pulled Back Below 1.0300

EUR/USD pulled back as traders reacted to U.S. inflation data. In the EU, traders focused on Germany’s Full-Year GDP Growth Report, which showed that GDP grew at -0.2%. The report met analyst consensus.

The nearest support level for EUR/USD is located in the 1.0235 – 1.0250 range. A move below the 1.0235 level will open the way to the test of the next support at 1.0100 – 1.0115.

GBP/USD Tests Support At 1.2200 – 1.2215

GBP/USD is mostly flat in volatile trading. U.S. inflation data served as the key catalyst for GBP/USD today.

Currently, GBP/USD is trying to settle back below the support at 1.2200 – 1.2215. In case this attempt is successful, GBP/USD will move towards the next support level, which is located in the 1.2080 – 1.2100 range.

USD/CAD Attempts To Settle Above 1.4350

USD/CAD is swinging between gains and losses as traders focus on the dynamics of the U.S. dollar and monitor the moves in commodity markets.

If USD/CAD settles back above the 1.4350 level, it will get to the test of the 50 MA at 1.4377. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

USD/JPY Is Under Pressure As Treasury Yields Fall

USD/JPY moved lower as traders reacted to the strong pullback in Treasury yields.

A successful test of the support at 156.00 – 156.50 will push USD/JPY towards the next support level at 153.50 – 154.00.

For a look at all of today’s economic events, check out our economic calendar.