The US Dollar (USD) exhibited notable strength against major currencies during the Asian session on Monday, with EUR/USD rebounding to near 1.1700 and USD/JPY rising to the 159.85 region, both opening with bullish gaps [1][2]. Technical analysis for EUR/USD indicates a modest bullish bias, as the pair trades above both the nine-day and 50-day Exponential Moving Averages (EMAs), supported by a 14-day Relative Strength Index (RSI) near 56, suggesting positive momentum with room for further upside [1]. The primary resistance for EUR/USD is at the upper boundary of the ascending channel around 1.1750, followed by the eight-week high of 1.1834, reached on February 23. Immediate support is at the 50-day EMA of 1.1640 and the nine-day EMA of 1.1636, with a break below these levels exposing the lower boundary around 1.1500 and the eight-month low of 1.1411, recorded on March 13 [1].
The Euro was the weakest against the US Dollar, with a percentage change of -0.32% for EUR/USD, highlighting the USD's dominance in the currency markets today [1]. Meanwhile, USD/JPY maintained a bullish bias, comfortably above the 200-period Simple Moving Average (SMA), with an RSI near 63 indicating firm upside momentum. The MACD also turned increasingly positive, suggesting buyers retain control, though intervention fears and speculation about authorities stepping in to stem JPY weakness capped further gains [2]. Initial support for USD/JPY is at the 200-period SMA of 158.56, followed by the 158.25-158.20 zone and the 158.00 mark, which, if broken, could make the pair vulnerable [2].
Market sentiment was influenced by failed US-Iran peace talks, which triggered global risk aversion and benefited the US Dollar's reserve currency status [2]. Rallying crude oil prices fueled inflationary fears and reaffirmed hawkish US Federal Reserve (Fed) expectations, further underpinning the USD and supporting both EUR/USD and USD/JPY pairs [2]. Economic concerns in Japan, stemming from imported energy shocks due to the Middle East conflict, weighed on the Japanese Yen, but speculation about potential intervention limited aggressive bearish bets [2].
Forward-looking statements suggest that USD/JPY bulls may await sustained strength and acceptance above the 160.00 psychological mark before positioning for an extension of the recent appreciating move [2]. For EUR/USD, technical momentum remains constructive as long as the pair stays above key EMAs, with upside potential toward resistance levels if bullish momentum persists [1].
CONCLUSION
The US Dollar's strength against both the Euro and Japanese Yen was driven by global risk aversion, hawkish Fed expectations, and technical bullish setups. While EUR/USD and USD/JPY both showed upside momentum, intervention fears and key resistance levels may limit further gains. Market participants are closely watching for sustained moves above critical thresholds to confirm continued USD appreciation.