The Analytical Overview of the Main Currency Pairs on 2024.04.08

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0833
• Prev. Close: 1.0832
• % chg. over the last day: +0.02%

The dollar was supported on Friday after the US Non-Farm Payrolls data rose more than expected, reinforcing expectations that the Fed will not be in a hurry to cut interest rates. US Non-Farm Payrolls for March rose by 303,000, exceeding expectations of 214,000 and being the largest increase in 10 months. In addition, Fed representatives Logan and Bowman’s comments were bullish for the dollar, as they said that now is not the time to start cutting interest rates.

Trading recommendations

• Support levels: 1.0815,1.0796,1.0759,1.0743
• Resistance levels: 1.0850,1.0867

Alternative scenario:

The EUR/USD currency pair’s trend on the hourly time frame is bullish. On Friday, the price corrected to the support zone below 1.0796, where buyers took the initiative. Now, the price is trading at the level of moving averages, and the MACD indicator has become inactive. Under such market conditions, buy trades can be considered on intraday time frames with a target up to 1.0850. We can consider the zone above 1.0850 for sell deals, provided sellers react.

Technical indicators of the currency pair:

Trading recommendations

The EUR/USD currency pair’s trend on the hourly time frame is bullish. On Friday, the price corrected to the support zone below 1.0796, where buyers took the initiative. Now, the price is trading at the level of moving averages, and the MACD indicator has become inactive. Under such market conditions, buy trades can be considered on intraday time frames with a target up to 1.0850. We can consider the zone above 1.0850 for sell deals, provided sellers react.

Alternative scenario:

if the price breaks the support level of 1.0743 and consolidates below it, the downtrend will be resumed with a high probability.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2636
• Prev. Close: 1.2637
• % chg. over the last day: +0.01%

At the start of the year, it was thought that the Fed would likely cut rates much sooner than its UK counterpart, as the UK had to deal with stubbornly higher inflation than most central banks. That prospect has helped sterling rise since last October. However, in the first quarter of this year, expectations of an imminent rate cut in the US weakened. At the same time, weak growth in the UK economy and slowing consumer price growth led to expectations of when the Bank of England might decide. Against this backdrop, the pound came under pressure. Markets are betting that the Bank of England may reduce the cost of borrowing as early as June, given signs that inflation is picking up.

Trading recommendations

• Support levels: 1.2625,1.2608,1.2594,1.2551
• Resistance levels: 1.2651,1.2674,1.2709

From the point of view of technical analysis, the trend on the GBP/USD currency pair on the hourly time frame is bullish. The situation is very similar to the euro scenario. GBP/USD quotes on Friday reached the support zone below 1.2594, where buyers took the initiative. After the volume spike, the market reaction was bullish, with intraday buying pressure persisting. Under these market conditions, buy trades should be sought from 1.2625 or 1.2608 with a target of 1.2651. Selling can be considered from the area above 1.2651, subject to sellers’ reactions.

Alternative scenario:

if the price breaks the support level of 1.2551 and consolidates below, the downtrend will be resumed with a high probability.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 151.32
• Prev. Close: 151.61
• % chg. over the last day: +0.20%

The Japanese yen rose to 151 per dollar on Friday, hitting its highest level in two weeks, as Japanese authorities stepped up verbal interventions to stem the yen’s sharp decline. Bank of Japan Governor Kazuo Ueda said the central bank could respond with monetary policy if the weakening yen affects the economy. Ueda added that inflation will likely accelerate from summer to fall as wage growth pushes up prices. But by the end of the trading day on Friday, the yen retreated from a 2-week high against the dollar and declined after T-bond yields jumped on a stronger-than-expected US payrolls report for May. Meanwhile, former chief currency diplomat Hiroshi Watanabe said last week that the government is unlikely to take any steps until the yen falls below 155 per dollar.

Trading recommendations

• Support levels: 151.43,151.14,150.84,150.25
• Resistance levels: 151.78,151.94,152.50

From a technical point of view, the medium-term trend of the currency pair USD/JPY is bullish. The Japanese price on Friday strengthened to the zone below 150.94, where the buyers came back into play. At the same time, sellers failed to keep the price in the 151.43 zone, which indicates buying pressure intraday. The price is trading above the moving averages again, and the MACD indicator also points to growth. The price has reached the resistance level of 151.78, but the sellers’ reaction is weak, and this level is likely to be broken. The price is aiming to test liquidity above 151.94. Buy trades are best considered from the area below 151.43, but the price may not give such a pullback.

Alternative scenario:

if the price breaks and consolidates below the support level of 150.25, the downtrend will likely resume.

The XAU/USD currency pair (gold)

Technical indicators of the currency pair:

• Prev. Open: 2291
• Prev. Close: 2329
• % chg. over the last day: +1.65%

Precious metals gave up early losses on Friday and returned to growth. As a result, gold regained an all-time high, and silver hit a 2-year-high. Precious metals rose on Friday amid increased geopolitical risks between Iran and Israel. Iran threatened Israel with retaliation for airstrikes on the Iranian military in Syria, which sharply boosted demand for precious metals. In addition, long silver stocks in ETFs rose to a 7-month-high. Currently, there are no fundamental prerequisites for a trend reversal in gold.

Trading recommendations

• Support levels: 2321,2300,2267,2249,2229,2206
• Resistance levels: 2350,2400,2450,2500

From the point of view of technical analysis, the trend on the XAU/USD is bullish. The 2300 resistance level failed to keep the price from rising again. Economists suggest that the medium-term target for gold is the 2500 mark. Currently, the price has reached the round level of 2350, where partial fixation of profits is observed. The price is overbought again, and the MACD indicator is signaling divergence. It is unwise to sell against such a trend, and for buy trades, it is necessary to wait for the correction to 2321. If the price exceeds 2300, it may trigger a sell-off and a deeper correction.

Alternative scenario:

if the price breaks below the support at 2267, the downtrend will likely resume.