EUR/USD, GBP/USD, USD/CAD, USD/JPY Forecasts – U.S. Dollar Tests New Highs Ahead Of Fed Decision

U.S. Dollar

U.S. Dollar Index continues to move higher ahead of the Fed Interest Rate Decision, which will be released tomorrow. Traders bet that Powell’s comments would be hawkish. Interestingly, Treasury yields are moving lower, but this move does not put any pressure on the American currency.

In case U.S. Dollar Index settles above 105.50, it will get to the test of the nearest resistance level at 105.75 – 106.00.

EUR/USD

EUR/USD tests support at 1.0710 – 1.0725 as traders focus on the strength of the American currency.

It should be noted that RSI is in the oversold territory, so the risks of a rebound are increasing.

GBP/USD

GBP/USD is swinging between gains and losses as traders react to the UK Unemployment Rate report. The report indicated that Unemployment Rate increased from 4.3% in March to 4.4% in April, compared to analyst consensus of 4.3%.

The nearest support level for GBP/USD is located in the 1.2670 – 1.2700 range. A successful test of this level will open the way to the test of the next support at 1.2580 – 1.2600.

USD/CAD

USD/CAD is mostly flat despite the pullback in precious metals markets. It looks that USD/CAD needs additional positive catalysts to settle above the significant resistance at 1.3785 – 1.3800.

If USD/CAD climbs above the 1.3800 level, it will gain additional momentum and move towards April highs near the 1.3850 level.

USD/JPY

USD/JPY gains ground as traders prepare for the Fed decision. There are no signs of interventions from the BoJ, which is not surprising as Japan’s central bank will certainly wait for comments from the U.S. central bank before making any decisions.

From the technical point of view, USD/JPY is slowly moving towards the key resistance level at 158.00 – 158.50.

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