The Analytical Overview of the Main Currency Pairs on 2021.12.24

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.1323
• Prev. Close: 1.1326
• % chg. over the last day: +0.03%

Inflationary pressures continue to rise in Germany. Import prices in Germany increased to 24.7% in annual terms in November. Monthly import prices jumped by a colossal 3% in November, which is three times more than the evaluation.

Trading recommendations

• Support levels: 1.1293,1.1230,1.1168
• Resistance levels: 1.1360,1.1436,1.1535,1.1613,1.1667,1.1717

From a technical point of view, the EUR/USD on the hour time frame is still bearish. The MACD indicator has become inactive; volatility is decreasing before the Christmas holidays. It is better to consider sell deals from the priority change level. Buy trades can be considered on the lower time frames from the support level of 1.1293, but only with additional confirmation.

Alternative scenario:

if the price breaks out through the 1.1360 resistance level and fixes above, the mid-term uptrend will likely resume.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.3348
• Prev. Close: 1.3411
• % chg. over the last day: +0.48%

A study in the UK showed that the risk of hospitalization for the Omicron strain was 50-70% lower than for the delta strain. But hospitalizations are not decreasing because Omicron spreads much faster. Analysts expect the UK economic numbers for Q4 to be weak.

Trading recommendations

• Support levels: 1.3362,1.3301,1.3277,1.3220
• Resistance levels: 1.3434,1.3507,1.3575,1.3685

On the hourly time frame, the trend on GBP/USD is still bullish. The weakness of the dollar index has allowed the British currency to strengthen significantly. The MACD indicator is in the positive zone with no signs of reversal. Under such market conditions, traders should consider buy positions from the 1.3362 support level but only with additional confirmation in the form of a buyers’ initiative. Sell trades can be considered from the resistance level of 1.3434, but only with additional confirmation in the form of a sellers’ initiative.

Alternative scenario:

if the price breaks down through the 1.3277 support level and consolidates below, the bearish scenario will likely resume.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 114.04
• Prev. Close: 114.40
• % chg. over the last day: +0.32%

In November, Japan’s consumer inflation demonstrated the most significant increase in annual terms due to higher fuel prices for almost two years, signaling the widening impact of rising global commodity prices. Japan’s core consumer price index (CPI), which excludes food prices but includes the cost of oil, increased by 0.5% in November. However, this increase is unlikely to prompt the Bank of Japan (BOJ) to reduce monetary stimulus anytime soon since inflation is still far from the central bank’s 2% target.

Trading recommendations

• Support levels: 114.30,113.95,113.76,113.30,112.62,112.30
• Resistance levels: 115.15,115.50

The global trend on the USD/JPY currency pair has changed to bullish. The price managed to break through the priority change level and consolidate higher. The MACD indicator is signaling a divergence, which means that a slight correction should be expected. Buy positions should be considered from the 114.12 support level, but with additional confirmation in the form of a buyers’ initiative. There is no optimal entry point for sell positions now.

Alternative scenario:

if the price fixes below 113.46, the uptrend will likely be broken.

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2834
• Prev. Close: 1.2804
• % chg. over the last day: -0.23%

The Canadian dollar is a commodity currency, so it correlates strongly with oil prices and the dollar index. Oil prices are increasing slowly, while the dollar index was stable yesterday. The Canadian dollar is strengthening. A positive for the Canadian currency was also the GDP data. Canadian GDP increased by 0.8% in November but economic activity is still 0.4% below the pre-pandemic level.

Trading recommendations

• Support levels: 1.2809,1.2721,1.2677,1.2638
• Resistance levels: 1.2903,1.2951

From a technical point of view, the USD/CAD currency pair trend is bullish. The MACD indicator is in the negative zone, but sellers’ pressure is decreasing. Under such market conditions, it is better to look for buy deals from the support level of 1.2809. Sell deals should be considered from the resistance level of 1.2903, but with additional confirmation in the form of a sellers’ initiative.

Alternative scenario:

if the price breaks down through the 1.2783 support level and fixes below, the downtrend will likely resume.