The EUR/USD currency pair

• Prev Open: 1.0549
• Prev Close: 1.0494
• % chg. over the last day: -0.52%

The consumer price level in the Eurozone increased by 0.8% last month, above expectations of 0.6%. The annual inflation rate in the region jumped from 7.4% to 8.1%. Just a year ago, the inflation rate was 2%. Markets are now pricing in a 25 basis point ECB rate hike in July and at least one 50 basis point hike by September.

• Support levels: 1.0499, 1.0408, 1.0379
• Resistance levels: 1.0611, 1.0680, 1.0723

From the technical point of view, the trend on the EUR/USD currency pair on the hourly time frame is bearish. The price has corrected to the average values, and the MACD indicator has become inactive, but the buyers’ pressure is still there. Under such market conditions, sell deals can be considered from the resistance level 1.0611, but only after the additional confirmation. A price move above 1.0611 is not desirable for the sellers. Buy trades are best to look for on intraday time frames from the support level of 1.0499, but only with confirmation and short targets.

Alternative scenario: if the price breaks out through the 1.0611 resistance level and fixes above, the uptrend will likely resume.

• – Eurozone ECB President Lagarde Speaks at 16:00 (GMT+3);
• – Eurozone ECB President Lagarde Speaks at 18:00 (GMT+3);
• – US FOMC Bullard Speaks at 19:45 (GMT+3).

The GBP/USD currency pair

• Prev Open: 1.2348
• Prev Close: 1.2218
• % chg. over the last day: -1.06%

The UK will update its inflation data this week. While the average economist’s forecast for inflation suggests an increase to 9.1% in annual terms, one estimate by Natixis SA suggests a 10% value. The Bank of England believes it will peak at just above 11% this year. The BoE also warned that the economy could face contraction in the second quarter. Economists’ forecasts show that retail sales are likely to decline this week, while purchasing managers’ surveys show a further slowdown in manufacturing and services.

• Support levels: 1.2176, 1.1974
• Resistance levels: 1.2252, 1.2422, 1.2470, 1.2523, 1.2629

From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame is bearish. The price is trading between the two accumulative balances, but the initiative of the buyers remains in recent days. Under such market conditions, sell deals can be considered from the resistance level of 1.2252, but only after the additional confirmation. Buy trades are best to look for on intraday time frames from the support level of 1.2176, but only with confirmation and short targets.

Alternative scenario: if the price breaks out through the 1.2422 resistance level and fixes above, the uptrend will likely resume.

The USD/JPY currency pair

• Prev Open: 132.15
• Prev Close: 134.94
• % chg. over the last day: +2.11%

On Friday, Central Bank of Japan Governor Kuroda said that the country’s inflation rate is likely to remain in the 2% range. Therefore, monetary policy easing in Japan continues. There is no fundamental reason for the JPY to strengthen, so analysts expect the USD/JPY to rise further. On the other hand, if inflation data shows an increase in consumer prices later this week, the yen might appreciate sharply.

• Support levels: 134.74, 133.38, 131.67, 131.00, 130.12, 129.48, 128.76, 128.10, 127.64
• Resistance levels: 135.16

The medium-term trend on the USD/JPY currency pair is bullish. The price increased sharply on Friday after the news about the Bank of Japan keeping its soft monetary policy. Under such market conditions, buy trades can be considered from the support level of 134.74 or 133.38, but with confirmation. A resistance level of 135.16 is good for sell deals, but only with additional confirmation in the form of a reverse initiative and short targets.

Alternative scenario: If the price fixes below 131.67, the downtrend will likely resume.

The USD/CAD currency pair

• Prev Open: 1.2945
• Prev Close: 1.3026
• % chg. over the last day: +0.62%

According to a Bloomberg survey of economists, inflation in Canada is likely to reach its highest level in nearly 40 years. Statistics Canada data released this week is expected to show the Consumer Price Index reaching 7.3%. The Bank of Canada has warned that inflation will rise soon, and officials have continually revised their forecasts upward over the past year. The bank sees continued price pressures and has signaled that its interest rate will likely approach the upper end of a neutral range of 2% to 3%.

• Support levels: 1.2970, 1.2815, 1.2709, 1.2618, 1.2578, 1.2510
• Resistance levels: 1.3068

In terms of technical analysis, the trend on the USD/CAD currency pair is bullish. The USD/CAD quotes continued to grow as the oil price decline negatively impacted the Canadian currency. The MACD indicator is in the positive zone, but the divergence is observed on several time frames, which means that price growth is limited. Under such market conditions, it is better to look for buy deals in the lower time frames from the support level of 1.2970. For sell deals, it is better to consider the resistance level of 1.3068, but it is also better with confirmation and short targets.

Alternative scenario: if the price breaks through and consolidates below the 1.2815 support level, the downtrend will likely resume.