The EUR/USD currency pair

• Prev Open: 1.0853
• Prev Close: 1.0896
• % chg. over the last day: +0.39%

The European currency has stopped falling as European countries want to issue new EU bonds. Europe is approaching stagflation. This is when economic growth starts to slow down when inflation is high. The sanctions imposed on Russia due to the invasion of Ukraine are also hitting the European economy hard, and it is currently not possible to entirely replace gas and oil supplies from Russia.

• Support levels: 1.0893, 1.0823, 1.0633
• Resistance levels: 1.1001, 1.1061, 1.1213

From the technical point of view, the trend on the EUR/USD currency pair on the hourly time frame is bearish. The MACD indicator has become positive. The price has taken the sideways structure. Under such market conditions, it is better to look for sell deals on the intraday time frames from the resistance level of 1.1001. Buy deals should be considered from the support level of 1.0893, but only with short targets, as there are no fundamental reasons for the euro to strengthen now.

Alternative scenario: if the price breaks out through the 1.1061 resistance level and fixes above, the mid-term uptrend will likely resume.

• – US JOLTS Job Openings (m/m) at 17:00 (GMT+2).

The GBP/USD currency pair

• Prev Open: 1.3105
• Prev Close: 1.3099
• % chg. over the last day: -0.05%

The British pound is now trading at its lowest level since December 2020. Despite Brexit, the UK economy is still strongly integrated into the European Union economy, so rising energy prices and sanctions against Russia have a negative impact on the British national currency. But on the other hand, thanks to the same Brexit and the fact that the Bank of England is tightening monetary policy, the UK will suffer the least from stagflation.

• Support levels: 1.3091
• Resistance levels: 1.3175, 1.3274, 1.3315, 1.3418

On the hourly time frame, the trend on the GBP/USD currency pair is bearish. Volatility is high, sellers’ pressure has stopped, the price started trading in a sideways range. The MACD indicator is showing a divergence towards buying. Under such market conditions, buy trades should be considered from the 1.3091 daily support level, but better with confirmation. The resistance level of 1.3175 is good for sell deals, but only with additional confirmation in the form of sellers’ initiative.

Alternative scenario: if the price breaks out through the 1.3315 resistance level and fixes above, the mid-term uptrend will likely resume.

The USD/JPY currency pair

• Prev Open: 115.32
• Prev Close: 115.67
• % chg. over the last day: +0.30%

Japan’s GDP increased by 1.1% in the last quarter, against expectations of 1.3% growth. The Japanese yen and the US dollar are safe-haven currencies. Since there are currently no prospects for ending the war in Ukraine, investors are buying the yen as a protective asset against inflationary risks. At the same time, it should be remembered that the policy of the Japanese central bank is now aimed at making the Japanese yen cheaper (USD/JPY growth), and the US Federal Reserve will begin to tighten monetary policy this month. As a result, the USD/JPY currency pair is now trading in a wide price range with growth elements.

• Support levels: 115.13, 114.71, 114.41
• Resistance levels: 115.79, 116.32

The medium-term trend on the USD/JPY currency pair is bullish, but the structure is flatter, as the price has no single dynamics and the price is trading in a wide corridor. The MACD indicator has become positive, with long positions prevailing inside the day. But there are first signs of divergence. Under such market conditions, it is best to look for buy deals on the lower time frames from the support level of 115.13, but with additional confirmation. Sell deals should be considered from the resistance level of 115.79, but it is better to wait for the reaction of sellers.

Alternative scenario: if the price fixes below 115.13, the uptrend will likely be broken.

• – Japan GDP (q/q) at 01:50 (GMT+2).

The USD/CAD currency pair

• Prev Open: 1.2819
• Prev Close: 1.2889
• % chg. over the last day: +0.55%

The situation on the USD/CAD currency pair remains the same. The Canadian dollar is a commodity currency, so it is highly dependent not only on the monetary policy of the Bank of Canada but also on the dynamics of oil prices and the dollar index. Investors buy the dollar index as a defensive asset in the war. Moreover, this month the Fed will begin tightening its monetary policy, providing additional support to the US currency. The growth of the dollar index leads to the growth of USD/CAD. However, it should be noted that the Bank of Canada has already begun to raise interest rates, and this, along with rising energy prices, will also help the Canadian currency.

• Support levels: 1.2820, 1.2726, 1.2653, 1.2555, 1.2517
• Resistance levels: 1.2890

In terms of technical analysis, the USD/CAD currency pair trend is bullish. The price is trading above the moving average lines, with long positions prevailing inside the day. The MACD indicator is in the positive zone, but the first signs of divergence are shown, which means the growth potential is limited. It is worth trading only with short targets because both oil and the dollar index are inclined to grow now. Under such market conditions, it is better to look for buy deals on the lower time frames from the support level of 1.2820, but it is better with additional confirmation. For sell deals, it is better to consider the resistance level of 1.2890.

Alternative scenario: if the price breaks through and consolidates below 1.2726, the downtrend will likely resume.

• – US Crude Oil Reserves (w/w) at 17:30 (GMT+2).