The Analytical Overview of the Main Currency Pairs on 2021.02.03

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2060
• Prev. Close: 1.2042
• % chg. over the last day: -0.15%.

The EUR/USD closed trading on Tuesday below the level of 1.2059. It is a signal for a further decline in the medium term. On the daily chart, there is a slight increase in the ADX on the decline, while the MACD has consolidated below zero. These are all factors that may mean a mid-term reversal.

Trading recommendations

• Support levels: 1.1799
• Resistance levels: 1.2059

The main scenario for trading the EUR/USD is selling. The former support at 1.2059 became a resistance level for the pair, as price fixation above it would mean a return to the previous range. The reaction of the ADX to the decline turned out to be rather weak, which indicated a slow decline or the likelihood of a stop. The MACD shows convergence, which serves as a strong signal for further decline.

Alternative scenario:

if the price consolidates above the level of 1.2059, the pair may return to the previous range of 1.2059 – 1.2155.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.3659
• Prev. Close: 1.3664
• % chg. over the last day: +0.04%

The British pound continued to resist the onslaught of bears and managed to close the day in positive territory, despite the rise in the dollar index. The Gilts’ yield has increased by almost 100 basis points over the week, which provides significant support to the sterling.

Trading recommendations

• Support levels: 1.3622,1.3517
• Resistance levels: 1.3744,1.4386

The main scenario for the GBP/USD pair is trading sideways between 1.3622 and 1.3744. The pair is trading strictly from support to resistance level. Movements within the day remain chaotic. The MACD returned to the zero level. The ADX is more responsive to short-term growth, which indicates the likelihood of a return to the resistance level within the day.

Alternative scenario:

if the pair consolidates above 1.3744, it is likely to resume growth to 1.3800. A breakthrough at the 1.3622 level could trigger a further fall towards 1.3517.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 104.91
• Prev. Close: 104.96
• % chg. over the last day: +0.04%

The dollar-yen pair is slowing down the growth but remains in a confident north direction. The indicators on the daily chart surge upwards steeply and are still far from the overbought area. Although the H4 is already signaling the need for a rollback or a short-term stop.

Trading recommendations

• Support levels: 104.82,104.40
• Resistance levels: 105.68,106.12

The main scenario is buying on a decline. The ADX shows no upside potential, dropping to zero. The MACD has also returned to zero. Given the position on the H4 time frame, there is a possibility of a rollback to support levels. Although buying on a decline looks less risky.

Alternative scenario:

An alternative scenario assumes the price-fixing below 104.40. In this case, the pair may return to the previous trading range of 104.40 – 103.56.

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2859
• Prev. Close: 1.2777
• % chg. over the last day: -0.64%

On Tuesday, the Canadian dollar was the strongest currency against the US dollar. Oil prices continued to rise, which put significant pressure on the USD/CAD pair. The Brent quotes reached $57.8 per barrel. WTI was able to rise just above $55.

Trading recommendations

• Support levels: 1.2737,1.2686
• Resistance levels: 1.2875,1.2932

The main scenario is selling to the 1.2737 support level. The MACD continues to signal that the support level has been reached. The ADX has largely reacted to the decline, which confirms the short-term downtrend scenario.

Alternative scenario:

if the price gains a foothold above 1.2813, it may resume growth to the resistance level of 1.2875.