The Analytical Overview of the Main Currency Pairs on 2023.04.18

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0989
• Prev. Close: 1.0926
• % chg. over the last day: -0.57%

The statistical data on the economic sentiment index in Germany and Europe will be published today. The Index is expected to rise from 13.0 to 15.5 in Germany and rise from 10.0 to 12.2 in the Eurozone. In the Eurozone, inflationary pressures across countries are declining, and economic indicators are rising. The fundamental picture is in favor of a 0.5% rate hike at the May ECB meeting.

Trading recommendations

• Support levels: 1.0894,1.0830,1.0803,1.0770,1.0680
• Resistance levels: 1.1016,1.1041,1.1185

The trend on the EUR/USD currency pair on the hourly time frame is bullish. The price has corrected to the buying zone. The MACD indicator is in the negative zone, and sellers’ pressure is starting to decrease, but one more price down wave is possible before the reversal. Buy trades should be looked at the support at 1.0894 or after the impulse breakout of 1.0962. Sell positions can be considered from the resistance level of 1.1015, but only with a confirmation in the form of a false breakdown.

Alternative scenario:

if the price breaks down through the support level of 1.0894 and fixes below it, the downtrend will likely resume.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2406
• Prev. Close: 1.2376
• % chg. over the last day: -0.24%

Fresh labor market data will be released today in the UK, weighing on the Bank of England’s subsequent decision. Jobless claims are expected to fall by 2.5 thousand, and the unemployment rate will remain at 3.7%. The British pound could see a sell-off if the data is worse. Conversely, strong labor market data will give confidence to the British currency, increasing the likelihood of a rate hike of another 0.25% at the next Bank of England meeting.

Trading recommendations

• Support levels: 1.2343,1.2320,1.2267,1.2178,1.2112
• Resistance levels: 1.2406,1.2469,1.2519,1.2643

From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame is bullish but close to reversing. The price has been corrected very deeply, indicating that the sellers are starting to take over the general initiative. But the MACD indicator shows a divergence, and momentum is upward. The bullish momentum may occur in today’s news publication. It is better to buy after a true breakout of the 1.2406 level. Sell trades are best looked for on intraday time frames from the resistance level of 1.2469 but with confirmation in the form of a reverse initiative.

Alternative scenario:

if the price breaks down through the 1.2343 support level and fixes below it, the downtrend will likely resume.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 133.79
• Prev. Close: 134.47
• % chg. over the last day: +0.51%

Vice Governor of the Bank of Japan, Mr. Uchida, indicated yesterday that budgetary restrictions would not undermine the bank’s ability to conduct monetary policy. But exactly what steps will be taken was not specified. Investors are awaiting the Bank of Japan’s meeting under new leadership at the end of next week. There is a slight possibility that the BoJ will further adjust its yield curve management settings or abandon it.

Trading recommendations

• Support levels: 134.04,133.12,132.02,131.82,130.62
• Resistance levels: 135.11,136.07,137.91

From the technical point of view, the medium-term trend on the currency pair USD/JPY is bullish. The price is moving in steps upwards, forming narrow ranges. It is best to use the moving averages but with confirmation to join the trend. But it should be noted that the price is now quite overbought and has not yet reached a resistance level. The best option for a sell entry would be a false break of the resistance level of 135.11 and a confirmation in the form of a change in the price structure on the lower time frames.

Alternative scenario:

if the price fixes below the 132.00 support level, the downtrend will be resumed with a high probability.

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.3369
• Prev. Close: 1.3392
• % chg. over the last day: +0.17%

Canada has seen a decline in wholesale sales. Sales figures for February were down by 1.7%. The decline in sales was mainly in cars, auto parts, food, beverages, and tobacco products. This suggests that despite falling consumer prices in recent months, overall inflationary pressures remain high. Falling oil prices are also making adjustments to USD/CAD pricing. But the medium-term outlook points to a further strengthening of the Canadian.

Trading recommendations

• Support levels: 1.3341,1.3267
• Resistance levels: 1.3427,1.3488,1.3515,1.3563,1.3616,1.3644

From the point of view of technical analysis, the trend on the USD/CAD currency pair is bearish. The price has corrected into a selling area. The MACD indicator is in the positive zone but indicates that another rise is likely. Completion of the corrective wave is best expected in the premium zone (highlighted on the chart). Sell deals are best sought from the resistance level of 1.3427, but only with confirmation in the form of a reverse initiative. Buy trades are best sought from the support level of 1.3341, but only with confirmation on the lower time frames and short targets.

Alternative scenario:

if the price breaks out and consolidates above the resistance level of 1.3427, the uptrend will likely resume.