The Analytical Overview of the Main Currency Pairs on 2022.02.08

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.1462
• Prev. Close: 1.1441
• % chg. over the last day: -0.18%

A stronger-than-expected US jobs report last week underscored the focus on inflation. Investors are in no hurry to open new positions ahead of US inflation data. Strong consumer growth will force the Fed to accelerate its tightening policy. Since no important economic events are expected until Thursday, the EUR/USD currency pair will be trading in a wide flat, possibly with a slight advantage in favor of a stronger dollar.

Trading recommendations

• Support levels: 1.1414,1.1362,1.1329,1.1275
• Resistance levels: 1.1481,1.1534,1.1617

Alternative scenario:

From the technical point of view, the EUR/USD on the hourly time frame is bullish. The EUR/USD currency pair is trading in the wide corridor of 1.1414-1.1481, but there is a slight sellers’ pressure to the lower boundary. Under such market conditions, buy trades should be looked for after a small pullback to the moving average line because the price has deviated strongly from the average values. Sell trades are better to look for on intraday time frames from the upper boundary of the corridor, but only with short targets.

Technical indicators of the currency pair:

Trading recommendations

From the technical point of view, the EUR/USD on the hourly time frame is bullish. The EUR/USD currency pair is trading in the wide corridor of 1.1414-1.1481, but there is a slight sellers’ pressure to the lower boundary. Under such market conditions, buy trades should be looked for after a small pullback to the moving average line because the price has deviated strongly from the average values. Sell trades are better to look for on intraday time frames from the upper boundary of the corridor, but only with short targets.

Alternative scenario:

if the price breaks out through the 1.1275 support level and fixes below, the mid-term uptrend will likely be broken.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.3531
• Prev. Close: 1.3535
• % chg. over the last day: -0.03%

The British pound now has fundamental support from the Bank of England because when interest rates rise, the national rate strengthens in the medium term. However, it should not be forgotten that the Fed is also preparing to raise interest rates since March and may do so more aggressively if Thursday’s inflation data turns out to be worse than expected.

Trading recommendations

• Support levels: 1.3475,1.3457,1.3434
• Resistance levels: 1.3550,1.3583,1.3619,1.3639,1.3662

On the hourly time frame, the trend on GBP/USD is bullish. But the price has now locally corrected to the moving average, with the MACD indicator becoming inactive. Under such market conditions, buy trades should be looked at from the support level 1.3475. There are no optimal entry points for sell deals now.

Alternative scenario:

if the price breaks out through the 1.3475 support level and consolidates below, the bullish scenario will be broken.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 115.26
• Prev. Close: 115.09
• % chg. over the last day: -0.15%

The monetary policy of the Bank of Japan is now aimed at making the JPY cheaper due to the maximum stimulus, while the Fed is tightening monetary policy and may do it more aggressively if Thursday’s inflation data turns out to be disappointing. In the medium term, the USD/JPY quotes will rise.

Trading recommendations

• Support levels: 115.15,114.96,114.76
• Resistance levels: 115.73,116.08

The global trend on the USD/JPY currency pair is bullish. The Japanese yen keeps getting cheaper amid the rising dollar index and due to the ultra-soft monetary policy of the Bank of Japan. Under such market conditions, it is best to look for buy deals on the lower time frames from the support level of 115.15. Sell potions can be looked for at the nearest resistance levels, but only with short targets and additional confirmation.

Alternative scenario:

if the price fixes below 114.76, the uptrend will likely be broken.

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2745
• Prev. Close: 1.2664
• % chg. over the last day: -0.64%

The Canadian dollar is a commodity currency, so it depends not only on the monetary policy of the Bank of Canada but also on the oil prices and the dollar index. The outlook for the Canadian dollar is getting more bullish as oil trades at its 7-year highs, and there are all the prerequisites for further growth. The fundamental picture is that both the dollar index and oil prices will increase. That is why it is not worth waiting for the USD/CAD to show a medium-term trend at the moment.

Trading recommendations

• Support levels: 1.2649,1.2586,1.2506
• Resistance levels: 1.2729,1.2792

From a technical point of view, the USD/CAD currency pair is bullish. But yesterday, the price corrected back deeply into the corridor, where there was an impulse exit. As a rule, such a return is not good for continuing the movement, so it’s very likely that the price will now form a new, wider flat. Under such market conditions, it is better to look for buy trades on the lower time frames from the support levels of 1.2649. There are no optimal entry points to sell deals now.

Alternative scenario:

if the price breaks through the 1.2649 support level and fixes below, the downtrend is likely to resume.