The EUR/USD currency pair

• Prev Open: 1.0636
• Prev Close: 1.0558
• % chg. over the last day: -0.74%

Traders now expect the Fed to raise rates by 50 basis points at each of the next three meetings as the US central bank struggles to fight inflation well above its 2% target. The hawkish remarks by Powell and other Fed members have sparked rumors that a much higher level of 75 basis points will also be considered. Nevertheless, many analysts believe that the Fed’s aggressiveness is already in the prices. This means that when the official data is released, the dollar, on the contrary, may fall.

• Support levels: 1.0453
• Resistance levels: 1.0699, 1.0770, 1.0796, 1.0870, 1.0908, 1.0936

From the technical point of view, the EUR/USD currency pair trend on the hourly time frame is bearish. Growth in the dollar index led to the fall of the European currency. The MACD indicator is in the negative zone, selling pressure remains, but divergence has appeared. Under such market conditions, traders can look for sell deals from the resistance level of 1.0699, but only after the additional confirmation. Buy trades can be considered on intraday timeframes from the support level of 1.0453, but only with short targets and confirmation.

Alternative scenario: if the price breaks out through the 1.0770 resistance level and fixes above, the uptrend will likely resume.

• – Eurozone Spanish Consumer Price Index (m/m) at 10:00 (GMT+2);
• – Eurozone ECB Economic Bulletin (m/m) at 11:00 (GMT+2);
• – Eurozone German Consumer Price Index (m/m) at 15:00 (GMT+2);
• – US Initial Jobless Claims (w/w) at 15:30 (GMT+2);
• – US GDP (q/q) at 15:30 (GMT+2).

The GBP/USD currency pair

• Prev Open: 1.2573
• Prev Close: 1.2545
• % chg. over the last day: -0.22%

The pound sterling fell to a 21-month low against the dollar amid rising fears over the UK economic outlook. The UK government borrowing in the recently ended 2021/22 fiscal year was almost 20% higher than the country’s budget office forecast last month. This underscored the problem for Finance Minister Rishi Sunak, who is forced to provide new aid to households and businesses affected by rising inflation.

• Support levels: 1.2438
• Resistance levels: 1.2670, 1.2791, 1.2862, 1.2917, 1.2981, 1.3010, 1.3083, 1.3115

On the hourly time frame, the GBP/USD currency pair trend is still bearish. Growth in the dollar index led to the fall of the British pound. The MACD indicator is in the negative zone, selling pressure remains, but the divergence is increasing. The price has reached the daily support level. Under such market conditions, sell trades should be looked for from the resistance level of 1.2670, but with confirmation. For buy deals, traders may consider the level of 1.2438, but only after the appearance of a bullish initiative and with short targets.

Alternative scenario: if the price breaks down through the 1.2863 resistance level and fixes above, the mid-term uptrend will likely be resumed.

The USD/JPY currency pair

• Prev Open: 127.21
• Prev Close: 128.42
• % chg. over the last day: +0.95%

On Thursday, the Bank of Japan decided to maintain its monetary policy despite the weakening yen and rising inflationary pressures due to higher import costs. Japan is a major energy importer, and sustained increases in gas and oil prices undermine Japan’s trade conditions. The central bank’s board has decided to maintain its overall monetary policy, setting 10-year rates at around zero and short-term rates at -0.1%, reaffirming its commitment to unlimited government bond purchases. Thus, it may contribute to the next round of Japanese yen weakness.

• Support levels: 128.87, 128.51, 127.24, 126.91, 125.48, 124.66, 122.97
• Resistance levels: 130.85

The medium-term trend on the USD/JPY currency pair is bullish. The MACD indicator is positive again, and the buying pressure has increased. Under such market conditions, it is best to look for buy deals, expecting the continuation of the uptrend, but only after a pullback, as the price has strongly deviated from the average values. First of all, it is worth considering the support level of 128.87 or 128.51, but with additional confirmation. A resistance level of 130.85 may be considered for sell deals, but only with short targets.

Alternative scenario: If the price fixes below 126.91, the uptrend will likely be broken.

• – Japan Retail Sales (m/m) at 02:50 (GMT+2);
• – Japan BoJ Monetary Policy Statement at 06:00 (GMT+2);
• – Japan BoJ Interest Rate Decision at 06:00 (GMT+2);
• – Japan BoJ Outlook Report at 06:00 (GMT+2);
• – Japan BoJ Press Conference (tentative).

The USD/CAD currency pair

• Prev Open: 1.2818
• Prev Close: 1.2816
• % chg. over the last day: -0.02%

The Canadian dollar is a commodity currency and is highly dependent on the oil price movements and the dollar index. The dollar index is growing along with oil quotes. As a result, the USD/CAD currency pair is trading without significant changes. Currently, the USD/CAD currency pair has no fundamental prerequisites for a medium-term trend as rising oil prices, together with the Bank of Canada’s plans to raise interest rates, will strengthen the Canadian dollar.

• Support levels: 1.2745, 1.2644, 1.2607, 1.2521
• Resistance levels: 1.2852

The USD/CAD currency pair is bullish in terms of technical analysis. The MACD indicator remained positive, but the divergence increased. Trade is worth it only with short targets. Under such market conditions, it is better to look for buy trades on the lower timeframes from the support level of 1.2745 or 1.2644, but it is better with additional confirmation. For sell deals, it is better to consider the resistance level of 1.2852, but it is also better with confirmation and short targets.

Alternative scenario: if the price breaks through and consolidates below 1.2607, the downtrend will likely be resumed.

• – Canada BOC Gov Macklem Speaks at 01:30 (GMT+2).