Sunday , July 3 2022

USD Dollar Price Estimate: EUR / USD, GBP / USD, USD / CAD



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US Dollar, EUR / USD, GBP / USD, USD / CAD call points:

  • The US dollar will likely remain in the spotlight for early this week, as the July CPI numbers are due to be released tomorrow morning at 8:30 ET.
  • Last month, the core CPI remained above the Fed's 2% target, complicating the bank's shift to more policy change. Expectation for tomorrow is another 2.1% printing of Core CPI, along with 1.7% expectation for header CPI.
  • DailyFX forecasts are published in a variety of ways markets as gold, the US dollar or the euro and are available from DailyFX Trading Guides PageIf you want to improve your trading approach, take a look Characteristics of successful traders, And if you are looking for a primer on the Forex market, check out our New to the FX Guide,

US dollar in focus before CPI was issued

Tomorrow morning brings the release of CPI numbers from July, and this is the first release of this data after the rather surprising 2.1% printing of basic CPI last month. This complicates plans to cut the Fed's interest rates, with underlying inflation remaining above target and at least part of the reason why the FOMC may hesitate to take a more aggressive stance. The big question tomorrow is where will the CPI go? Expectation is another 2.1% print for Core CPI, along with expectations of 1.7% for CPI titles. But if this is printed below expectations, recent US dollar weakness topics can gain considerable focus and this could put even more attention on the recent bullish break in gold.

Below I analyze a series of adjustments around the US dollar.

EUR / USD "Stuck" in key price range

EUR / USD early in the month calmed down over the past week. As this outburst of US dollar weakness turned against the backdrop of additional tariffs on China (less than 24 hours after FOMC) EUR / USD exploded from fresh 2-year lows to reach a key area of ​​the chart, which is moving from 1.1187-1.1212. Over the past week, price actions have continued to rise in this range, creating a scenario that can be broken in any way.

Row Reading – Prices have built a short bearish channel in this resistance zone. From short-term benefits, it can be considered as a bullfight scenario, and for those looking at US dollar breakdown scenarios, this may be of interest.

Two-hour chart of EUR / USD

eur / usd eurusd two-hour price chart

Diagram prepared by James Stanley; EURUSD at Tradingview

Taking a step back to the daily schedule, however, can make it a little more attractive from a bearish perspective. The continuing stall in this key area of ​​previous maintenance keeps the door open for short side swing; and this can relate well to those looking for a dollar return around tomorrow's CPI release.

EUR / USD Daily price chart

daily price chart eurusd eur / usd

Diagram prepared by James Stanley; EURUSD at Tradingview

GBP / USD: Cable broken, grabbing mercy offer over 1.2000

This has been a brutal showing in the British pound over the last few months, and this topic continued last week as the pair embarked on another two year period. Prices came extremely close to the 1.2000 level before grabbing some support; and since then this support has been open this week.

Given the aggressive targeting that has been part of the GBP for some time, the reverse position can be difficult to justify. The relief rally may be in the face of a deep resale, but in order to look for weakness in the US dollar, there are more attractive options for dealing with this topic. In a particular case, when the dollar fell after FOMC earlier this month and the EUR / USD rose to a fresh two-week high, the corresponding move in Cable was shallower as sellers remained hawkish in the offer to further limit the jump.

This can make the pair high resistance in the pair as an attractive scenario to follow in the next few days.

GBP / USD Two-hour price chart

gbpusd gbp / usd two-hour price chart

Diagram prepared by James Stanley; GBPUSD at Tradingview

USD / CAD brings reversal potential for USD weakness scenarios

For those looking to continue the weakness of the USD, USD / CAD remains an interest. The pair was in a sharp bearish trade trend in June, with a combination of a nobler Fed and a stronger Canadian dollar at the back of higher-than-expected inflation pushing the pair to fresh lows in 2019. But this bearish theme began to wane. it slowed to 1.3000 and after two weeks of milling in mid-July, the bullish twist began to develop. Buyers were riding the wave just over 1.3300 when the pair began showing symptoms of take-off last week. Withdrawal at the end of the week back to found deals for 1.3200 handle and so far this is maintained as open week support.

For those looking at bigger topics in the picture of USD weakness, the short side of USD / CAD can remain so interesting, looking for a deeper break down to 1.3100 and maybe even to the 1.3000 level.

USD / CAD Eight hour price chart

usdcad usd / cad eight hour price chart

Diagram prepared by James Stanley; USDCAD at Tradingview

To read more:

Are you looking for a longer term analysis of the US dollar? ours DailyFX Predictions there is a section for each major currency and we also offer numerous resources on gold or USD– couples like EUR / USD, GBP / USD, USD / JPY, AUD / USD, Traders can also keep up with short term positioning through ours IG Customer sentiment indicator,

Forex Trading Resources

DailyFX offers plenty of tools, metrics and resources to help traders. For those looking for trading ideas, ours IG client mood shows the positioning of retailers with actual live transactions and positions. ours sales guides submit our DailyFX monthly forecasts and our best trading options; and ours real-time news feeds there are intraday interactions from the DailyFX team. And if you are looking for real-time analysis, ours DailyFX Webinars we offer numerous sessions every week where you can see how and why we watch what we watch.

If you are looking for educational information, ours New to the FX Guide does it help new traders while ours Characteristics of the study of successful traders was created to help sharpen skills by focusing on risk management and trade.

— Written by James Stanley, strategist for DailyFX.com

Connect and follow James on Twitter: @JStanleyFX

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