The Analytical Overview of the Main Currency Pairs on 2023.06.01

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0728
• Prev. Close: 1.0687
• % chg. over the last day: -0.38%

Philadelphia Federal Reserve President Patrick Harker and Federal Reserve Governor and Vice Chair nominee Philip Jefferson said Wednesday that the US Central Bank may suspend interest rate hikes at its June meeting. They warned, however, that the pause would not mean that the Fed’s rate-raising cycle has come to an end. In other words, the Fed could pause until July to estimate the impact of interest rates on the economy. And there could be another hike in July. According to the CME FedWatch Tool, there is a 66% chance of a pause in June. But that could change after Friday’s US labor market data.

Trading recommendations

• Support levels: 1.0659,1.0634
• Resistance levels: 1.0720,1.0759,1.0800,1.0836,1.0875,1.0904,1.0956

The trend on the EUR/USD currency pair on the hourly time frame is bearish. The price is now trading at the level of the moving averages. The MACD indicator is in the negative zone, and the momentum shows the weakness of sellers. Divergence is still visible, but only on the higher timeframe. Under such market conditions, buy trades can be better considered from the support level of 1.0659, but only with additional confirmation. Sell deals can be considered from the resistance level of 1.0720 but with confirmation in the form of sellers’ reaction.

Alternative scenario:

if the price breaks through the resistance level of 1.0758 and fixes above it, the uptrend will likely resume.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2401
• Prev. Close: 1.2439
• % chg. over the last day: +0.31%

UK business confidence declined in May. Companies were less optimistic both about their own trade prospects and about the economy as a whole. Meanwhile, the balance of businesses expecting prices to rise fell slightly, while wage expectations remained high. But despite the weak economic data, the British pound is now more stable than the euro.

Trading recommendations

• Support levels: 1.2393,1.2364,1.2322
• Resistance levels: 1.2445,1.2468,1.2546,1.2569,1.2612

From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame is bearish. But the price is getting closer to the priority change level. The MACD indicator has become positive. The most optimal level to buy is the level of 1.2393 but with confirmation. It is best to look for sell deals from the resistance level of 1.2468 or 1.2468 but with a confirmation in the form of a false breakout and change of the initiative on the lower time frames.

Alternative scenario:

if the price breaks down through the 1.2468 resistance level and fixes above it, the uptrend will likely resume.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 139.75
• Prev. Close: 139.24
• % chg. over the last day: -0.37%

Global central banks may already be facing a new economic environment in which inflation and interest rates will no longer return to the low levels of the past, Bank of Japan (BOJ) Governor Kazuo Ueda said Wednesday. Given some of the reversal of globalization and the high levels of public and private debt accumulated during the pandemic, global interest rates may not return to low levels for much longer, Ueda said. According to Ueda, the Bank of Japan’s planned policy review will look at various tools to combat deflation. Following these statements, there are renewed rumors that the Bank of Japan will still seek to normalize policy.

Trading recommendations

• Support levels: 138.81,138.00,137.54,136.52,135.66,135.15,134.67
• Resistance levels: 139.60,140.70,141.07

From the technical point of view, the medium-term trend on the currency pair USD/JPY is bullish. The price is now correcting within a bullish medium-term trend. Indicator MACD is in the negative zone, with signs of bearish pressure. The support level of 138.80 can be used to join the bullish trend with a reverse reaction. Sell trades can be considered from the resistance level of 139.61 or from the moving averages, but with confirmation in the form of a bearish initiative.

Alternative scenario:

if the price fixes below the 138.80 support level, with a high probability the downtrend will resume.

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.3599
• Prev. Close: 1.3573
• % chg. over the last day: -0.20%

According to Statistics Canada, the national economy as a whole continued to grow in the first quarter of 2023. The Canadian economy grew at an annualized rate of 3.1% in the first quarter, beating the Bank of Canada’s earlier estimate of 2.3% growth in the first quarter. Most economists were surprised by the latest demonstration of the economy’s resilient strength, which analysts said makes it more likely that the Bank of Canada will have to raise interest rates again to suppress inflation.

Trading recommendations

• Support levels: 1.3566,1.3523,1.3484,1.3468,1.3436,1.3397,1.3267
• Resistance levels: 1.3589,1.3647,1.3667,1.3695

From the point of view of technical analysis, the trend on the USD/CAD currency pair in the medium term is bullish. The price forms a broad-volatile corridor and trades on the lower boundary of this corridor with no signs of buyer strength. There is a high probability of further decline. The MACD indicator is in the negative zone with signs of seller pressure. Under such market conditions, it is better to look for buy trades from the 1.3567 support level but with confirmation in the form of a false breakdown and buyers’ initiative on the lower time frames. In the case of a deeper correction, look for purchases from the 1.3523 level. It is best to look for sales from the resistance level of 1.3589 or 1.3647, but only with confirmation.

Alternative scenario:

by JustMarkets, 2023.06.01