**US Dollar Price Action Setups: EUR/USD, GBP/USD, USD/CAD, USD/JPY**
by [James Stanley, Forex.com](https://www.forex.com/en-sg/news-and-analysis/us-dollar-price-action-setups-eurusd-gbpusd-usdcad-usdjpy-2025-08-15/)
The US dollar remains a central focus in the currency markets, especially as global macroeconomic conditions continue to shift. Following a period marked by persistent inflation, fluctuating rate hike expectations from the Federal Reserve, and evolving economic data, the greenback’s trajectory against major peers has attracted significant attention.
This analysis delves deeply into the major pairs: EUR/USD, GBP/USD, USD/CAD, and USD/JPY. Utilizing price action and recent technical developments, this piece aims to provide traders with actionable insights for navigating current market conditions.
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## US Dollar Index (DXY) – The Broader Context
Before diving into each pair, it’s crucial to consider the broader US dollar narrative.
**Key Drivers Impacting the USD:**
– Federal Reserve rate expectations: The Fed’s forward guidance and data dependency continue to drive the dollar. Surprising US data releases or FOMC tone shifts quickly translate into volatility.
– Risk sentiment: The dollar often serves as a safe haven in periods of heightened risk aversion.
– US yield differentials: Interest rate spreads between the US and other G10 countries remain influential.
– Macroeconomic data: High-impact releases such as Non-Farm Payrolls, CPI inflation, retail sales, and PMIs routinely move the market.
**Technical Overview:**
– The DXY has oscillated between defined support and resistance bands throughout recent weeks.
– Buyers continue to defend higher-low structures around the 103.00-103.50 region, while resistance is seen closer to 106.00.
– Momentum indicators, such as the Relative Strength Index (RSI), have reflected shifts between overbought and oversold, giving clues to short-term exhaustion or renewed vigor.
With this context in mind, let’s turn to the major dollar pairs.
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## EUR/USD – Lower Highs and Rangebound Frustration
The EUR/USD, as the most heavily traded pair globally, remains at the heart of the US dollar’s story. The recent price action reflects “lower highs” on the chart, suggesting that euro bulls are struggling to gain traction amidst a firming dollar.
**Key Developments:**
– The pair has repeatedly failed to hold above the 1.1000 handle, marking that zone as strong resistance.
– A series of lower highs since the May peak suggests bearish momentum, despite intermittent recoveries.
– Support remains clustered around the 1.0850-1.0880 region, where buyers frequently stepped in.
– Below that, the next critical support zone sits near 1.0750, a level tested multiple times throughout the last six months.
**Technical Factors:**
– The 200-day simple moving average lies near the midpoint of the recent range, acting as a potential magnet for price if volatility recedes.
– The daily RSI has shown persistent failure to regain momentum above 60, underlining the limp bullish attempts.
**Scenarios and Setups to Watch:**
– **Bullish breakout**: A clean daily close above 1.1000, accompanied by strong upside volume, would invalidate the lower-high sequence and could open the door to a run toward 1.1100.
– **Continuation lower**: Sustained breaks beneath 1.0850 would expose prior swing lows near 1.0750, and ultimately 1.0650 if bearish momentum accelerates.
**Fundamental Watchpoints:**
– European Central Bank policy meetings, especially concerning forward guidance on rate cuts or persistent hawkishness.
– US data beats or misses that recalibrate Fed hike/cut odds.
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## GBP/USD – BoE and Fed Crosscurrents
Read more on GBP/USD trading.