U.S. Dollar Drifts Lower as Job Openings Hit 18-Month Low: Analysis For EUR/USD, GBP/USD

Market Overview

The U.S. Dollar Index (DXY) is holding firm above the 99.00 mark, despite a mixed economic backdrop shaped by weakening labor demand and persistent trade uncertainty. Markets remain focused on the upcoming release of the March Core Personal Consumption Expenditures (PCE) Price Index, a key inflation gauge that could influence expectations for future Federal Reserve policy decisions.

Job Openings Hit 18-Month Low as Labor Market Cools

On Tuesday, the U.S. Bureau of Labor Statistics reported that job openings dropped to 7.19 million in March—down from a revised 7.48 million in February and below the consensus forecast of 7.5 million. This represents the lowest reading since September 2024, suggesting employers are increasingly cautious about hiring amid broader economic headwinds.

The moderation in labor demand may temper expectations for sustained economic expansion and could weigh on the Fed’s interest rate trajectory.

Still, the dollar remains supported, with the DXY maintaining its footing above 99.00. Anticipation around the PCE report later this week is providing near-term strength, as traders look for confirmation of disinflation trends or signs of renewed price pressures.

Trade Policy Signals Add to Market Uncertainty

In parallel, U.S.–China trade dynamics continue to shape sentiment. While President Donald Trump has indicated a willingness to ease tariffs, and Beijing recently removed some of its 125% duties on select U.S. goods, clear progress remains elusive.

A spokesperson for the Chinese embassy denied any active tariff negotiations, contradicting earlier optimism.

U.S. Treasury Secretary Scott Bessent emphasized that future talks depend on China’s willingness to engage. This lack of clarity has left markets wary, with trade policy uncertainty continuing to influence both economic outlooks and currency movements.

US Dollar Index (DXY) – Technical Analysis

The U.S. Dollar Index (DXY) is drifting near $99.15, trapped in a tight consolidation just below the $99.42 pivot point. The 50 EMA at $99.30 is acting as immediate pressure, while the 200 EMA overhead at $100.23 keeps the broader downtrend in place.

Price action remains capped by a descending trendline from April highs, indicating persistent bearish bias.

On the downside, $98.90 offers initial support, followed by $98.46 and $98.03 as key reaction zones. A close below $99 could trigger downside momentum, especially if upcoming U.S. data surprises to the downside.

For now, DXY is caught in limbo—needing a break above $99.42 or below $98.90 to set its next move.

GBP/USD Technical Analysis

GBP/USD is consolidating just below $1.3400, holding above the key support zone at $1.3364, which aligns with the 50 EMA ($1.3363). The 200 EMA at $1.3229 provides a firmer base, while the ascending trendline from mid-April remains intact.

Price structure still favors higher lows, suggesting bullish momentum is not yet broken. However, the lack of follow-through above $1.3445 resistance hints at short-term exhaustion.

A break above $1.3445 could expose $1.3498, while a close below $1.3364 may shift focus to $1.3280. For now, sterling bulls are treading cautiously—waiting for U.S. macro data to potentially ignite a directional breakout.

EUR/USD Technical Forecast

EUR/USD is holding firm around $1.1394, testing resistance near the 50 EMA at $1.1382. Price remains supported by an ascending trendline and the $1.1356 level, keeping bullish structure intact. A bounce from this area suggests buyers are still defending the uptrend.

On the upside, a break above $1.1424 could invite a rally toward $1.1481, while failure to hold $1.1356 risks a retreat toward the $1.1311–$1.1264 zone. The 200 EMA below at $1.1289 remains a major support buffer.

With candles showing higher lows and firm support beneath, the pair is coiled for a potential breakout—likely hinging on incoming U.S. economic data later this week.