EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts – U.S. Dollar Pulls Back As Traders React To Jobs Data

By:

Vladimir Zernov

Published: Jan 4, 2024, 16:19 GMT+00:00

The better-than-expected ADP Employment Change report did not provide support to the American currency.

EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts

Key Insights

EUR/USD moved back above 1.0950 as Germany’s Inflation Rate jumped to 3.7%.
GBP/USD settled near the 1.2700 level as traders reacted to the strong UK Services PMI report.
USD/JPY moved towards 145.00 as Treasury yields continued to rebound.

U.S. Dollar

DXY 040124 4h Chart

U.S. Dollar Index is losing some ground as traders react to ADP Employment Change report, whcih showed that private businesses added 164,000 jobs in December. Today, traders also focused on the final reading of Services PMI report, which indicated that Services PMI increased from 50.8 in November to 51.4 in December.

U.S. Dollar Index needs to settle above the 102.70 level to gain additional upside momentum and move towards the next resistance level at 103.50 – 103.75.

EUR/USD

EUR/USD 040124 4h Chart

EUR/USD gained some ground as traders reacted to Germany’s inflation report, which showed that Inflation Rate increased from 3.2% in November to 3.7% in December.

In case EUR/USD stays above the 1.0950 level, it will head towards the next resistance at 1.1015 – 1.1035.

GBP/USD

GBP/USD 040124 4h Chart

GBP/USD moved higher after the release of the better-than-expected UK Services PMI report. The report showed that UK Services PMI increased from 50.9 in November to 53.4 in December, compared to analyst consensus of 52.7.

If GBP/USD settles above the resistance at 1.2650 – 1.2685, it will move towards the next resistance level at 1.2820 – 1.2850.

USD/CAD

USD/CAD 040124 4h Chart

USD/CAD is mostly flat as traders wait for additional catalysts. Other commodity-related currencies have found themselves under pressure in today’s trading session.

If USD/CAD climbs above the nearest resistance at 1.3380 – 1.3410, it will move towards the next resistance at 1.3480 – 1.3500.

USD/JPY

USD/JPY 040124 Daily Chart

USD/JPY continues to move higher as traders focus on the rebound in Treasury yields.

RSI has recently moved into the overbought territory, so the risks of a pullback are increasing.

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

About the Author

Vladimir Zernovauthor

Vladimir is an independent trader, with over 18 years of experience in the financial markets. His expertise spans a wide range of instruments like stocks, futures, forex, indices, and commodities, forecasting both long-term and short-term market movements.