The U.S. Dollar Index mostly traded sideways last week with mix sentiments, and ended the week on a negative note by losing 0.31 points on Friday which is indicating a potential downward moment in the Index in near term.
The recent interest rate decision had gave the Dollar Index a good start of the week but the Greenback encountered resistance and lost its gaining momentum in middle of the week supported by the weak economic reports of U.S Treasury yields and gave a weak closing on Friday by losing 0.31 pints on daily basis and 0.17 points on weekly basis the week.
The coming week is expected to be volatile for Dollar Index and if the Index will break the support of 96.00 in coming trading session then it can start to fall and continue its down trend next month, however the movement is largely depends on the upcoming US and UK GDP data and Japan CPI economic reports due next week.
A series of President Draghi speaks and CPI data will play an important role in the movement in the pair. Last week was a volatile week for Euro where the currency dropped in the starting of the week due to the hawkish movement of US Dollar but it managed to regain ground and recovered the losses made in the starting of the week and managed to give a flat closing of the week.
The next week is also expected to be a tough week for Euro as Darghi is not at all in a hurry to reveal the QE tapering which can keep the movement of the pair in a tight range.
Technical outlook: On technical ground the EUR/USD pair is showing some positive signals and it can test the level of 1.1280 in near term if it crosses the short term resistance zone of 1.1200 to 1.1215 in the starting for the week, however the resistance is strong and it can give bears a chance to decide the fate of the pair.
The Japanese inflation figures due next week is a major event where investors keep an eye on as the sideways movement of the pair is giving a sign of a big movement in near term.
USD/JPY par is trading at a very crucial level and consolidating in a tight range of 111.80 to 111.00 which can be seen in the daily levels and weekly candles are facing resistance and it is indicating a potential bearish movement in near term.
On technical ground the pair is trading in a downward channel which is still intact as the weekly and daily candles are clearly showing the rejection of 112.00 levels and this can result in a fall which can lead the pair near to the level of 108.60 in near term.
However if the bearish movement of USD will continue then this can comfort the JPY and the pair can again give a sideways movement in coming week.
The pair had managed to give bullish movement in the ending of the week but the down trend in the pair is which can be seen clearly on weekly chart is still an aria of concern. The down trend in the GBP is still on the move and the pair can stop its gaining movement near to the resistance level of 1.2770 and again start falling as the Pound is still not strong and the overall sentiments for the pair is still negative on the back of the Political concerns and the start of the Brexit negotiation which can put bearish pressure on the pair.
The rate hike possibility helped USD/CAD to ignore the bearish movement of Oil last week and the pair was able to recover from its lows and moved with bullish sentiments.
The GDP data for both the US and Canada is due next week and market is expected to be volatile due to this factor as investors will closely watch the economic report and take the advantage of the movement.
On technical ground the pair is at its support zone and it can bounce form this levels however the oil price which is at it decline can affect the bullish movement in the pair.