The Analytical Overview of the Main Currency Pairs on 2022.03.01

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.1126
• Prev. Close: 1.1219
• % chg. over the last day: +0.82%

According to Mario Centeno, a member of the European Central Bank’s Governing Council, the Eurozone could be vulnerable to stagflation after Russia attacks Ukraine. ECB officials are ready to cut bond purchases amid record inflation at their March 10 meeting. However, the economic consequences of the war and the sanctions imposed now complicate that task.

Trading recommendations

• Support levels: 1.1185,1.1126,1.1032
• Resistance levels: 1.1263,1.1300,1.1392,1.1459

From the technical point of view, the trend on the EUR/USD currency pair on the hourly time frame is bearish. The MACD indicator has become inactive. The price is trading in a wide price corridor. Under such market conditions, it is best to look for sell trades on intraday time frames from the resistance level of 1.1300. Buy trades should be considered from the intraday support level of 1.1185, but only with short targets.

Alternative scenario:

if the price breaks out through the 1.1300 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: 1.3321
• Prev. Close: 1.3419
• % chg. over the last day: +0.74%

The British pound has lost confidence, and now, just like the euro, is heavily dependent on the dollar index, which changes under the influence of 2 main factors: the war in Ukraine and the Fed’s policy. Basically, both the dollar index and the GBP are inclined to rise now, so traders should trade with short-term targets.

Trading recommendations

• Support levels: 1.3317,1.3274,1.3220
• Resistance levels: 1.3442,1.3486,1.3529,1.3560

Alternative scenario:

The GBP/USD currency pair trend is bearish on the hourly time frame. Volatility has increased sharply. Now the price is trading in a wide corridor with the boundaries of 1.3317-1.3442. Under such market conditions, buy trades should be considered from the level of 1.3317, but it is better with confirmation. The resistance level of 1.3442 is good for sell deals, but only with an additional confirmation in the form of sellers’ initiative.

Technical indicators of the currency pair:

Trading recommendations

The GBP/USD currency pair trend is bearish on the hourly time frame. Volatility has increased sharply. Now the price is trading in a wide corridor with the boundaries of 1.3317-1.3442. Under such market conditions, buy trades should be considered from the level of 1.3317, but it is better with confirmation. The resistance level of 1.3442 is good for sell deals, but only with an additional confirmation in the form of sellers’ initiative.

Alternative scenario:

if the price breaks out through the 1.3486 resistance level and fixes above, the mid-term uptrend will likely resume.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 115.38
• Prev. Close: 114.97
• % chg. over the last day: -0.35%

The Japanese yen is a safe-haven currency in case of various financial shocks. With the beginning of Russia’s aggression against Ukraine, the Japanese yen has become a safe-haven currency for many investors, along with the US Dollar. For this reason, both the Japanese yen and Dollar Index are now inclined to rise, even though the policies of the central banks of the USA and Japan are diametrically opposite.

Trading recommendations

• Support levels: 114.99,114.78,114.41
• Resistance levels: 115.49,115.69,115.87,116.32

The medium-term trend on the currency pair USD/JPY is bullish. But the MACD indicator has become negative. There is intraday seller’s pressure. Under such market conditions, it is better to buy from the support level 114.99, but with additional confirmation. For sell deals, resistance level 115.49 may be considered.

Alternative scenario:

if the price fixes below 114.41, the uptrend will likely be broken.

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2768
• Prev. Close: 1.2668
• % chg. over the last day: -0.78%

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 fundamental picture now is that both the dollar index and oil prices will grow. Investors are buying the dollar index as a defensive asset in times of war. Next month, the Fed will start tightening monetary policy, providing additional support to the US currency. But oil prices could rise even more on fears of disruption in supplies from Russia. The Bank of Canada will hold a meeting this week, which is likely to raise the interest rate. Against the backdrop of these expectations, the Canadian dollar may strengthen in the coming days.

Trading recommendations

• Support levels: 1.2636
• Resistance levels: 1.2721,1.2797,1.2820,1.2876

From the technical point of view, the USD/CAD currency pair trend has changed to bearish. The price has consolidated below both moving averages. It is worth trading only with short targets because both oil and the dollar index are inclined to grow now. Under such market conditions, it is better to look for buy trades on lower time frames from the support level of 1.2636, but it is better with additional confirmation. For sell deals, it is better to consider the resistance level of 1.2721.

Alternative scenario:

if the price breaks through and consolidates above 1.2797, the downtrend will most likely be broken.