EUR/USD, GBP/USD, USD/CAD, USD/JPY – U.S. Dollar Retreats As Traders React To Non Farm Payrolls Report

Key Insights

• EUR/USD gained ground as traders focused on the pullback in Treasury yields. 
• GBP/USD moved towards yearly highs as traders bet that BoE would be more hawkish than Fed in the upcoming months. 
• USD/JPY gained downside momentum as the pullback continued. 

U.S. Dollar

U.S. Dollar Index pulled back as traders reacted to Non Farm Payrolls report, which showed that the economy added 209,000 jobs in June. Treasury yields pulled back from recent highs as traders bet on a less hawkish Fed, which was bearish for the American currency.

In case the U.S. Dollar Index settles below the support at 102.00 – 102.15, it will head towards the next support area, which is located in the 101.00 – 101.15 range.

EUR/USD

EUR/USD gained ground as traders focused on U.S. job market data. In Europe, Germany’s Industrial Production declined by 0.2% month-over-month in May, compared to analyst consensus of 0%.

In case EUR/USD manages to settle above the resistance at 1.0900 – 1.0935, it will head towards the next resistance, which is located at 1.1070 – 1.1095. RSI is close to the overbought territory, but there is enough room to gain additional upside momentum.

GBP/USD

GBP/USD rallied as traders bet that the BoE will continue to raise rates at a time when the Fed reaches peak rate level after the rate hike in July.

RSI is already in the overbought territory, so it remains to be seen whether GBP/USD can get above the resistance at 1.2820 – 1.2850 ahead of the weekend.

USD/CAD

USD/CAD pulled back as oil markets continued to rebound. The general weakness of the U.S. dollar served as an additional bearish catalyst for USD/CAD.

From the technical point of view, USD/CAD is moving lower after an unsuccessful attempt to settle above the resistance in the 1.3360 – 1.3380 range.

USD/JPY

USD/JPY remains under pressure as the pullback continues. Traders bet that Fed will reach the peak rate level after the last 25 bps hike in July.

RSI is in the oversold territory, so the risks of a rebound are increasing. In case USD/JPY settles below the support at 141.85 – 142.35, it will head towards the next support area at 140.45 – 140.80, although it could also get support near the 200 MA at 141.40.

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