The EUR/USD currency pair

• Prev Open: 1.1775
• Prev Close: 1.1836
• % chg. over the last day: +0.52%

With the Fed not planning to cut the QE program, the dollar index started moving downward again, triggering a rise in the EUR/USD currency pair (inverse correlation). Investors are waiting for US labor market data and consumer price index data from European countries, which will be released today and tomorrow.

• Support levels: 1.1791, 1.1746, 1.1609
• Resistance levels: 1.1834, 1.1889, 1.1934, 1.1969

The trend is still bearish. After the decline in the dollar index, the buyers’ pressure has increased again, making the price return to the wide range. The MACD indicator has returned to the positive zone. Under such market conditions, it is better to trade intraday. For sell positions, traders should wait for a pullback to the resistance level. Entries for long positions can be searched on support levels, but with short targets, as it will be trading against the trend.

Alternative scenario: if the price breaks out through the 1.1889 resistance level and fixes above, the general uptrend is likely to be resumed.

• – US Initial Job Claims (w/w) at 15:30 (GMT+3);
• – US Philadelphia Fed Manufacturing Index (m/m) at 15:30 (GMT+3);
• – US Industrial Production (m/m) at 16:15 (GMT+3);
• – US Fed Chair Jerome Powell’s Testimony at 16:30 (GMT+3).

The GBP/USD currency pair

• Prev Open: 1.3811
• Prev Close: 1.3858
• % chg. over the last day: +0.34%

Inflation in the UK exceeded the Bank of England target of 2% and reached 2.5%. This is the highest level since August 2018. Bank of England deputy governor John Cunliffe said that the central bank would carefully examine how sustainable inflation can be and only then will take action. For now, the Bank of England predicts that the inflation rate will reach 3% by the end of the year. The UK is getting ready to reopen the economy.

• Support levels: 1.3835, 1.3756
• Resistance levels: 1.3923, 1.4002, 1.4075, 1.4101, 1.4138, 1.4191

The GBP/USD trend is bearish on the H1 timeframe. The price is trading in a wide range now. The MACD indicator has become inactive. Under such market conditions, it is better to trade intraday. For sell positions, traders should wait for a pullback to the resistance level. Entries for long positions can be searched on support levels.

Alternative scenario: if the price breaks out through the 1.3922 resistance level and consolidates above, the bearish scenario is likely to be canceled.

• – UK Average Earnings Index (m/m) at 09:00 (GMT+3);
• – UK Claimant Count Change (m/m) at 09:00 (GMT+3);
• – UK Unemployment Rate (m/m) at 09:00 (GMT+3).

The USD/JPY currency pair

• Prev Open: 110.62
• Prev Close: 110.94
• % chg. over the last day: -0.62%

USD/JPY quotes sharply decreased amid the falling dollar index. The representative of the ruling party of Japan, Heizo Takenaka, in his interview for Bloomberg, said that Japan needs an additional $270 billion to support economic growth after the pandemic. It will take a long time before the gap between supply and demand in the economy is filled. Japan’s central bank is unlikely to change its monetary policy at its meeting tomorrow.

• Support levels: 109.63, 109.31
• Resistance levels: 110.47, 110.73, 111.06, 111.48, 110.73, 112.18

From the point of view of technical analysis, there is a downward trend on the H1 timeframe, as the price is still trading below the priority change level. The MACD indicator returned to the negative zone. Under such market conditions, traders are better to look for sell positions from the resistance levels on intraday timeframes. Buy positions should be considered from support levels, but only with short targets.

Alternative scenario: if the price rises above 110.73, the uptrend is likely to be resumed.

The USD/CAD currency pair

• Prev Open: 1.2510
• Prev Close: 1.2506
• % chg. over the last day: -0.03%

Canada’s central bank kept its key interest rate at 0.25% but cut its growth economy forecast for 2021 and plans to cut weekly federal bond purchases from $3 billion to $2 billion. The central bank said it expects the economy to grow 6.0% in 2021 (previous forecast 6.5%) and 4.6% in 2022 (previous forecast 3.7%). Also, the Bank will keep the rate near zero until the economy is ready to handle a rate hike, which is not scheduled until the second half of 2022.

• Support levels: 1.2519, 1.2448, 1.2404, 1.2347, 1.2312, 1.2260, 1.2190
• Resistance levels: 1.2587

Technically, the trend remains bullish. The price is still trading above the moving average and above the priority change level. The MACD indicator is in the positive zone with no signs of reversal. Under such market conditions, it is best to trade on the lower timeframes. Buyers may look for trades from the support levels within the day. There are no optimal entry points to open sell positions now.

Alternative scenario: if the price breaks down through the 1.2370 support level and fixes below, the downtrend is likely to be resumed.