EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts – U.S. Dollar Rebounds Despite Falling Treasury Yields

U.S. Dollar

U.S. Dollar Index gains ground despite disappointing ISM Manufacturing PMI report. The report showed that ISM Manufacturing PMI decreased from 48.5 in June to 46.8 in July, compared to analyst consensus of 48.8. Today, traders also focused on the final reading of S&P Global Manufacturing PMI report, which indicated that Manufacturing PMI pulled back from 51.6 in June to 49.6 in July. Numbers below 50 show contraction. Overall, the reports highlighted the current challenges in the manufacturing sector. Treasury yields moved lower, but this move did not put any pressure on the American currency.

A successful test of the resistance at 104.40 – 104.60 will push U.S. Dollar Index towards the next resistance level, which is located in the 105.90 – 106.10 range.

EUR/USD

EUR/USD is losing ground as traders focus on the Euro Area Unemployment Rate report. The report showed that Unemployment Rate increased from 6.4% in May to 6.5% in June, compared to analyst consensus of 6.4%.

If EUR/USD manages to settle below the support at 1.0785 – 1.0800, it will gain additional downside momentum and move towards the next support level at 1.0670 – 1.0690.

GBP/USD

GBP/USD pulls back as traders react to BoE Interest Rate Decision. The BoE cut the interest rate from 5.25% to 5.0%, in line with analyst consensus. Interestingly, 4 members voted to keep the rate unchanged.

A move below the support at 1.2780 – 1.2800 will open the way to the test of the next support level at 1.2685 – 1.2700.

USD/CAD

USD/CAD gains ground as traders focus on the pullback in commodity markets, which is bearish for commodity-related currencies.

If USD/CAD moves back above the 1.3850 level, it will head towards the resistance at 1.3880 – 1.3900.

USD/JPY

USD/JPY settled near the 150.00 level as traders took some profits off the table after the recent move.

In case USD/JPY manages to stay above 150.00, it will head towards the resistance at 151.50 – 152.00.

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