by JustForex
On Friday, the EUR/USD currency pair unexpectedly fell by 0.46%. On the one hand, there is a high probability that the euro will go lower for a medium-term correction. On the other hand, it is also impossible to say that it is a true breakdown of the 1.2113-1.2243 corridor because there was no impulsive move through the lower boundary of the range. Taking into account that the fundamental picture is in favor of the European currency, the price can return to the corridor, forming a false breakdown.
The price has deviated strongly from the moving average downward; the MACD indicator is in the oversold area with the first signs of divergence. The sellers’ pressure is higher now, so traders should look for sell trades from resistance levels. But considering the strong deviation from the middle line, it is also possible to look for buy trades from the support levels, but it is better to buy on intraday timeframes.
Alternative scenario: if the price breaks out through the 1.2212 resistance level and fixes above, the general uptrend is likely to resume.
The GBP/USD currency pair decreased by 0.37% on Friday. UK GDP added 2.3% in monthly terms, but annually the economy lagged by 3.7% from its pre-pandemic level. Industrial production data also came out positive, so fundamentally, the British currency has no reason to decline.
The GBP/USD currency pair trend remains bullish. At the moment, the price is trading below the moving average. The MACD indicator is negative. But the price is right at the support level, so under such market conditions, traders are better to look for buy trades. There are no optimal entry points for sell positions yet.
Alternative scenario: if the price breaks down through the 1.4075 support level and consolidates below, the bullish scenario is likely to be canceled.
The USD/JPY currency pair managed to break out of the 109.18-109.63 trading range. The pressure of buyers is now higher, but the situation remains contradictory. It is quite possible that the situation will not change significantly before the Fed meeting on Wednesday.
Technically, the mid-term trend is bullish as the price is above the priority change level of 109.18. The price is trading above the moving average while the MACD indicator is in the positive zone. Under such market conditions, traders can look for both buy trades from nearest support levels and sell trades from resistance levels.
Alternative scenario: if the price falls below 109.18, the general downtrend is likely to resume.
On Friday, the USD/CAD currency pair broke through the priority change level, activating an alternative scenario. The downtrend is broken. Investors expect a medium-term upward movement on the instrument.
Technically, the trend has changed to bullish. The seller pressure has disappeared. Under such market conditions, traders are better to look for buy trades from the support levels. Still, it should be noted that the price has deviated strongly from the moving average, so a slight correction below should be expected.
Alternative scenario: if the price breaks down through the 1.2060 support level and fixes below, the downtrend is likely to be resumed.
by JustForex
This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.
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