The Analytical Overview of the Main Currency Pairs on 2022.02.11

The EUR/USD currency pair

• Prev Open: 1.1422
• Prev Close: 1.1427
• % chg. over the last day: +0.04%

The number of new jobless claims in the US was 223,000, while analysts had expected 230,000. With the US inflation level being worse than forecast and the labor market continuing to recover, the Fed no longer needs to stimulate the economy. Markets are currently pricing a 0.5% rate hike in March, which is positive for the dollar index and negative for the euro.

• Support levels: 1.1362, 1.1329, 1.1275
• Resistance levels: 1.1423, 1.1481, 1.1534, 1.1617

From the technical point of view, the EUR/USD on the hourly time frame is bullish. But yesterday, on the CPI news, the price expanded the price range. The MACD indicator became negative, selling pressure is still high. Under such market conditions, buy trades should be looked at from the support level 1.1363. Sell trades are better to look for on intraday time frames from the resistance level of 1.1423.

Alternative scenario: if the price breaks out through the 1.1329 support level and fixes below, the mid-term uptrend will likely be broken.

• – German Consumer Price Index (m/m) at 09:00 (GMT+2);
• – US Michigan Consumer Sentiment (m/m) at 17:00 (GMT+2).

The GBP/USD currency pair

• Prev Open: 1.3533
• Prev Close: 1.3561
• % chg. over the last day: +0.20%

A mixed medium-term background is forming on the GBP/USD currency pair. The British pound now has fundamental support from the Bank of England because when interest rates rise, the national rate strengthens in the medium term. However, it should not be forgotten that the Fed is also preparing to raise interest rates since March and will likely do so more aggressively as US inflation continues to grow rapidly. A lot of macro statistics will come out from the UK today. Good data might help the pound avoid further depreciation amid the rising dollar index.

• Support levels: 1.3475, 1.3457, 1.3434
• Resistance levels: 1.3542, 1.3610, 1.3639, 1.3662

On the hourly time frame, the trend on GBP/USD is bullish. But yesterday, after the CPI news and “hawkish” statements of FED representatives, the British pound started to decline sharply amid the growth of the dollar index. Under such market conditions, buy trades should be looked at from the support level 1.3475. The resistance level of 1.3542 may be considered for opening sell deals, but only with additional confirmation in the form of sellers’ initiative.

Alternative scenario: if the price breaks out through the 1.3475 support level and consolidates below, the bullish scenario will be broken.

• – UK GDP (q/q) at 09:00 (GMT+2);
• – UK Industrial Production (m/m) at 09:00 (GMT+2);
• – UK Manufacturing Production (m/m) at 09:00 (GMT+2).

The USD/JPY currency pair

• Prev Open: 115.45
• Prev Close: 115.99
• % chg. over the last day: +0.47%

The monetary policy of the Bank of Japan is now aimed at making the JPY cheaper because of the maximum stimulus. At the same time, the Fed plans to tighten its monetary policy aggressively. Such opposite policy of central banks contributes to the growth of USD/JPY quotes.

• Support levels: 115.66, 115.15, 114.76
• Resistance levels: 116.12, 116.50

The global trend on the USD/JPY currency pair is bullish. The Japanese yen keeps getting cheaper amid the rising dollar index and due to the ultra-soft monetary policy of the Bank of Japan. The MACD indicator indicates a divergence. Under such market conditions, it is best to look for buy deals on the lower time frames from the support level of 115.66. Sell positions can be looked at from the resistance level 116.12, but only with short targets and additional confirmation.

Alternative scenario: if the price fixes below 115.15, the uptrend will likely be broken.

The USD/CAD currency pair

• Prev Open: 1.2666
• Prev Close: 1.2720
• % chg. over the last day: +0.42%

The Canadian dollar is a commodity currency, so it depends not only on the monetary policy of the Bank of Canada but also on the oil prices and the dollar index. The sharp increase in the dollar index after the negative CPI news in the US led to a decline in oil quotes. As a result, the USD/CAD currency pair sharply increased in price by the end of the trading day.

• Support levels: 1.2720, 1.2649, 1.2600, 1.2506
• Resistance levels: 1.2792

From a technical point of view, the USD/CAD currency pair is bullish. Yesterday the price reached the priority change level, but the buyers were very active at this level, and as a result, the price bounced sharply upwards. Now a wide corridor is forming on the hour timeframe, and the pressure of buyers remains high. Under such market conditions, it is better to look for buy trades on the lower time frames from the support level of 1.2720. There are no optimal entry points to sell deals for now.

Alternative scenario: if the price breaks through the 1.2649 support level and fixes below, the downtrend will likely resume.