The Analytical Overview of the Main Currency Pairs on 2021.08.05

The EUR/USD currency pair

• Prev Open: 1.1858
• Prev Close: 1.1836
• % chg. over the last day: -0.19%

The Eurozone Services PMI Index decreased yesterday. In general, the dynamics of economic growth in Europe is preserved, but there is a slight slowdown. In Germany, 10-year bond yields fell to -0.51% – the lowest level since early February. Negative government bond yields mean that investors are willing to pay for the opportunity to borrow their money. The fall in the yield of bonds, as a rule, negatively affects the national currency.

• Support levels: 1.1817, 1.1784, 1.1754, 1.1609
• Resistance levels: 1.1854, 1.1894, 1.1934, 1.1969

From a technical point of view, the general trend of the EUR/USD currency pair remains bullish. The price fell below the moving average; the MACD has moved into the oversold zone. Under such market conditions, it’s better to consider intraday trading. Buy positions should be considered from the nearest support levels. Sell deals should be considered from the resistance levels, but only throughout the day and with short targets.

Alternative scenario: if the price breaks through the 1.1784 support level and fixes below, the mid-term uptrend is likely to be broken.

• – US Initial Jobless Claims at 15:30 (GMT+3).

The GBP/USD currency pair

• Prev Open: 1.3912
• Prev Close: 1.3887
• % chg. over the last day: -0.18%

The GBP/USD currency pair decreased by 0.18% amid the decline of the dollar index. But unlike the euro, the British pound has gained a more confident position. Despite the decline, the price has not broken through the trading range. Today, the Bank of England will report about the interest rate and announce further plans regarding monetary policy. Economists do not expect any changes, but volatility on currency pairs with the pound will be high today.

• Support levels: 1.3886, 1.3825, 1.3772, 1.3714, 1.3676 ,1.3641, 1.3614, 1.3525
• Resistance levels: 1.3935, 1.4002, 1.4075, 1.4101

On the hour timeframe, the trend of the GBP/USD currency pair is bullish. The MACD indicator has become negative; the price is still inside of a corridor. Under such market conditions, traders are better to look for buy trades after buyers show initiative. There are no optimal points for sell positions right now.

Alternative scenario: if the price breaks through the 1.3714 support level and consolidates below, the bearish scenario is likely to resume.

• – UK Construction PMI (m/m) at 11:30 (GMT+3);
• – UK BoE Interest Rate Decision (m/m) at 14:00 (GMT+3);
• – UK BoE Monetary Policy Report at 14:00 (GMT+3).

The USD/JPY currency pair

• Prev Open: 109.02
• Prev Close: 109.48
• % chg. over the last day: +0.42%

The USD/JPY currency pair, which strongly correlates with the dynamics of the US currency, sharply increased by 0.42% amid a rise in the dollar index. Japan’s 10-year bond yields fell below zero this week for the first time since December. The fall in the yield of bonds, as a rule, negatively affects the national currency.

• Support levels: 109.61,109.19, 108.65
• Resistance levels: 109.88, 110.22, 110.41, 110.56

The main trend of the USD/JPY currency pair is bearish. The price is trading at the level of the moving average now. The MACD indicator has become positive. Under such market conditions, it is better for traders to look for sell positions from the resistance levels. Buy trades should be considered only after the price pulls back to the buyers’ initiative zone.

Alternative scenario: if the price rises above 109.88, the uptrend is likely to be resumed.

The USD/CAD currency pair

• Prev Open: 1.2533
• Prev Close: 1.2541
• % chg. over the last day: +0.06%

The Canadian dollar is highly dependent on the dollar index and the oil price dynamics. The dollar index jumped sharply yesterday, while oil prices continued to fall. Logic suggests that the USD/CAD rate should have jumped up with such a situation, but it did not happen. This means that the investors are expected to stabilize oil prices.

• Support levels: 1.2531, 1.2425, 1.2370, 1.2312
• Resistance levels: 1.2602, 1.2671, 1.2787, 1,2951

Considering technical analysis, the USD/CAD trend is bearish. The MACD indicator is inactive. Under such market conditions, traders should look for sell positions from the resistance levels after sellers show initiative. There are no optimal points for buy positions right now.

Alternative scenario: if the price breaks through the 1.2671 resistance level and fixes above, the uptrend is likely to be resumed.