EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts – U.S. Dollar Retreats As Housing Starts Drop 6.8%

U.S. Dollar

U.S. Dollar Index is moving lower as traders react to Michigan Consumer Sentiment report. The report indicated that Consumer Sentiment increased from 66.4 in July to 67.8 in August, compared to analyst consensus of 66.9. Today, traders also had a chance to take a look at the housing market reports. Housng Starts declined by 6.8% month-over-month in July, while analysts expected that they would drop by 2%. Building Permits decreased by 4%, compared to analyst forecast of -0.4%.

In case U.S. Dollar Index settles below the 102.50 level, it will move towards the next support, which is located in the 102.00 – 102.20 range.

EUR/USD

EUR/USD tests resistance at 1.0980 – 1.1000 as traders focus on the pullback in Treasury yields and general weakness of the U.S. dollar.

If EUR/USD manages to settle above the 1.1000 level, it will head towards the next resistance at 1.1110 – 1.1135.

GBP/USD

GBP/USD tests new highs as traders react to the Retail Sales report from the UK. The report showed that Retail Sales increased by 0.5% month-over-month in July, in line with analyst consensus. On a year-over-year basis, Retail Sales increased by 1.4%.

From the technical point of view, GBP/USD is moving towards the resistance at 1.2930 – 1.2950. RSI has recently moved into the overbought territory, but there is enough room to gain additional momentum in the near term.

USD/CAD

USD/CAD pulled back towards the 1.3700 level as gold tested historic highs, which was bullish for commodity-related currencies.

A move below 1.3700 will push USD/CAD towards the support at 1.3600 – 1.3620.

USD/JPY

USD/JPY is losing ground as traders take some profits off the table after the unsuccessful test of the resistance at 149.30 – 149.70.

In case USD/JPY declines below the 50 MA at 147.15, it will get to the test of the support at 146.00 – 146.50.

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