Market Analysis Summary - U.S. Dollar and Forex Trends
Published: June 23, 2026
Author: Vladimir Zernov
Key Highlights
- The U.S. Dollar Index is testing new highs as positive PMI data indicates continued economic expansion.
- EUR/USD is retreating due to disappointing PMI data from Germany.
- GBP/USD is also pulling back as UK PMI reports miss expectations.
- USD/CAD is gaining ground amid a sell-off in precious metals.
- USD/JPY is testing resistance levels despite positive PMI data from Japan.
U.S. Dollar Index Performance
The U.S. Dollar Index (DXY) is showing strength, currently attempting to settle above the resistance level of 101.15 – 101.30. The recent PMI reports revealed that the Manufacturing PMI rose from 55.1 in May to 55.7 in June, surpassing the forecast of 54.8. The Services PMI also increased from 50.7 to 51.3, indicating expansion in the services sector. The Composite PMI improved from 51.5 to 52.2, reinforcing the view that the U.S. economy is expanding robustly, which may prompt the Federal Reserve to consider raising interest rates to combat inflation.
EUR/USD Analysis
The EUR/USD pair has pulled back as traders reacted to weak PMI data from Germany, where the Composite PMI fell from 48.8 in May to 48.0 in June, below the expected 49.9. This indicates contraction in the German economy. The nearest support for EUR/USD is between 1.1350 and 1.1365, with further support at 1.1285 – 1.1300. The RSI indicates oversold conditions, suggesting a potential for a rebound.
GBP/USD Performance
GBP/USD is experiencing a decline as the PMI data from the UK also disappointed. The Manufacturing PMI decreased from 53.9 in May to 53.1 in June, while the Services PMI fell from 49.3 to 48.7, missing the forecast of 50.5. The pair is approaching support levels at 1.3165 – 1.3180, with the next support at 1.3085 – 1.3100.
USD/CAD Insights
USD/CAD is moving higher as traders react to a significant pullback in precious metals, with gold down by 1.2% and silver down by 4.6%. The nearest resistance for USD/CAD is at 1.4225 – 1.4240, and if it surpasses this level, it may reach 1.4300 – 1.4315. The RSI is nearing overbought territory, indicating potential for further gains.
USD/JPY Resistance Testing
USD/JPY is attempting to break through resistance at 161.50 – 162.00, despite positive PMI data showing an increase in both Manufacturing and Services PMIs. The Bank of Japan has not shown signs of intervention, and the yen remains at multi-decade lows. A successful test of the resistance could lead to further upside momentum, potentially reaching the 164.00 level if no intervention occurs.
Conclusion
The U.S. Dollar is showing strength against major currencies, driven by positive economic indicators. However, the performance of the Euro and Pound is hindered by disappointing PMI data from their respective economies. Traders should monitor these developments closely as they could influence future market movements.