U.S. Dollar Moves Higher As Dallas Fed Manufacturing Index Beats Estimates: Analysis For EUR/USD, GBP/USD, USD/CAD, USD/JPY

Key Points:

• EUR/USD declined below the 1.0400 level as traders reacted to U.S. economic reports.

• USD/CAD is trying to settle below the 1.4400 level despite the pullback in precious metals markets.

• USD/JPY moved towards the 157.00 level as traders focused on falling Treasury yields. ### In this article:

• EUR/USD

-0.39%

• GBP/USD

-0.47%

• USD/CAD

-0.14%

• USD/JPY

-0.44%

U.S. Dollar Index Tests Resistance At 108.30 – 108.50

DXY 301224 4h Chart U.S. Dollar Index gains ground as traders react to the better-than-expected Dallas Fed Manufacturing Index report. The report indicated that Dallas Fed Manufacturing Index improved from -2.7 in November to +3.4 in December, compared to analyst consensus of -0.4.

In case U.S. Dollar Index manages to settle above the strong resistance level at 108.30 – 108.50, it will head towards the next resistance at 109.40 – 109.60.

EUR/USD Pulled Back Below 1.0400

EUR/USD 301224 4h Chart EUR/USD pulled back after an unsuccessful attempt to settle above the resistance at 1.0435 – 1.0450. Trader focus on the rally in natural gas markets, which may put additional pressure on the European economy.

If EUR/USD settles below the 1.0375 level, it will move towards the next support level at 1.0330 – 1.0345.

GBP/USD Is Under Pressure As Traders Focus On U.S. Economic Reports

GBP/USD 301224 4h Chart GBP/USD pulled back as traders focused on general strength of the American currency.

From the technical point of view, GBP/USD needs to settle below the nearest support level at 1.2475 – 1.2490 to gain additional downside momentum in the near term. RSI is in the moderate territory, so there is plenty of room to gain momentum in case the right catalysts emerge.

USD/CAD Attempts To Settle Below 1.4400

USD/CAD 301224 4h Chart USD/CAD moved back below the 1.4400 level despite the strong pullback in precious metals markets.

A move below the 50 MA at 1.4379 will push USD/CAD towards the support level at 1.4330 – 1.4350.

USD/JPY Retreats As Treasury Yields Fall

USD/JPY 301224 4h Chart USD/JPY is losing ground amid falling Treasury yields. The yield of 2-year Treasuries pulled back towards 4.25%, while the yield of 10-year Treasuries settled near the 4.55% level.

The nearest support for USD/JPY is located in the 156.00 – 156.50 range. A successful test of this support will push USD/JPY towards the next support at 153.50 – 154.00.

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