Market Analysis Summary - U.S. Dollar Rebounds

Published: August 3, 2026

Author: Vladimir Zernov

Key Highlights

• The U.S. Dollar Index (DXY) is gaining strength following a better-than-expected ISM Manufacturing PMI report.
• EUR/USD is experiencing a pullback due to disappointing retail sales data from Germany.
• GBP/USD is retreating as traders take profits after a recent rally.
• USD/CAD is rising as demand for commodity-related currencies declines.
• USD/JPY is rebounding after interventions from Japan and the U.S. to support the yen.

U.S. Dollar Index Performance

The U.S. Dollar Index is attempting to settle above the resistance level of 99.85 – 100.00, with potential to reach 100.50 – 100.65 if successful. The ISM Manufacturing PMI rose from 53.3 in June to 55.6 in July, surpassing the forecast of 54. Additionally, ISM Manufacturing Employment increased from 49.7 to 52.8, indicating expansion as values above 50 suggest growth.

EUR/USD Analysis

EUR/USD is losing ground, reacting to Germany's retail sales report, which showed a month-over-month decrease of -1.1% in June, worse than the expected -0.5%. The pair attempted to break above the resistance level at 1.1510 – 1.1525 but failed, pulling back towards the 1.1500 level. A drop below this level could lead to further declines towards the 1.1420 – 1.1435 range.

GBP/USD Movement

GBP/USD is pulling back as traders engage in profit-taking following a strong rally. A move below the 1.3400 level could test the support at 1.3335 – 1.3350. Conversely, for upward momentum, GBP/USD needs to settle above the resistance level at 1.3465 – 1.3480.

USD/CAD Trends

USD/CAD is gaining traction as commodity-related currencies weaken. The pair has climbed above the support level at 1.4010 – 1.4025 and is attempting to settle above 1.4050. A successful move above the 50 MA at 1.4070 could lead to resistance at 1.4125 – 1.4140.

USD/JPY Rebound

USD/JPY is moving away from session lows following interventions from Japan and the U.S. The extent of U.S. intervention remains unclear, but officials have indicated readiness to support the yen. If USD/JPY surpasses the 157.00 level, it may target resistance at 157.50 – 158.00, with further potential towards 159.50 – 160.00.

Conclusion

The U.S. dollar is showing resilience against major currencies, driven by positive manufacturing data and strategic interventions in the forex market. Traders are closely monitoring key levels for potential breakout or reversal opportunities across the major currency pairs.