The Analytical Overview of the Main Currency Pairs on 2023.06.13

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0745
• Prev. Close: 1.0757
• % chg. over the last day: +0.11%

The US inflation data for May will be released today. Inflationary pressures are expected to ease. Consumer prices are projected to fall from 4.9% to 4.1% year-over-year. Core inflation (which excludes food and energy prices) is expected to fall from 5.5% to 5.3% year-over-year. If the actual data match the forecast, it will increase the likelihood of a pause by the Fed at tomorrow’s meeting. This will be positive for the European currency as the interest rate differential between the US Fed and the ECB will start to decline.

Trading recommendations

• Support levels: 1.0765,1.0718,1.0688,1.0659,1.0634
• Resistance levels: 1.0762,1.0800,1.0836,1.0875,1.0904,1.0956

The trend on the EUR/USD currency pair on the hourly time frame has changed to bullish. The price is trading above the moving averages. The MACD indicator is in the positive zone, but the first signs of divergence have appeared. Under such market conditions, buy trades can be considered from the support level of 1.0765, but only with additional confirmation on the lower timeframes. Sell deals can be considered from the resistance level of 1.0800, but with confirmation in the form of a false breakout and a change in the structure on the lower time frames.

Alternative scenario:

if the price breaks through the support level of 1.0688 and fixes below it, the downtrend will likely resume.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2561
• Prev. Close: 1.2511
• % chg. over the last day: -0.40%

The labor market data will be released today in the UK. This data will be taken into account in shaping the opinion of the Bank of England policymakers. A robust labor market usually increases the likelihood of monetary tightening. Conversely, a cooling labor market is the first sign that high interest rates are starting to weigh on the economy. At the moment, the labor market is expected to remain resilient and 2 more interest rate hikes from the Bank of England are forecast.

Trading recommendations

• Support levels: 1.2477,1.2420,1.2391,1.2349
• Resistance levels: 1.2583,1.2612

From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame is bullish. The price is correcting and is now trading at the level of the moving averages. The MACD indicator has become negative. The best level to buy is 1.2477, but with confirmation. It is best to look for sell deals from the resistance level of 1.2583, but with confirmation in the form of reverse initiative.

Alternative scenario:

if the price breaks through the support level 1.2420 and fixes below it, the downtrend will most likely resume.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 139.32
• Prev. Close: 139.60
• % chg. over the last day: +0.21%

There will not be much economic news about Japan before Friday. Therefore, the main tone of the USD/JPY currency pair will be set by the dollar index. Inflation data will be released today in the US. If the actual data coincides with the forecasts, it will increase the probability that the FOMC Committee will leave the rate unchanged tomorrow. This will be negative for the USD index and this will push the USD/JPY down. Conversely, any surprises in the form of higher inflation will lead to an increase in USD/JPY quotes.

Trading recommendations

• Support levels: 138.94,138.80,138.00,137.54,136.52,135.66,135.15,134.67
• Resistance levels: 139.70,140.23,140.45,141.07

From the technical point of view, the medium-term trend on the currency pair USD/JPY is still bullish. The price is trading at the levels of the moving averages and forming a wide-volatile corridor. The MACD indicator has become inactive. The best way to buy is to use the support level of 138.94 but with confirmation on the lower time frames. Sell trades can be considered from the resistance level of 140.23 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: 1.3336
• Prev. Close: 1.3366
• % chg. over the last day: +0.23%

Crude oil prices fell by 4% on Monday. Iran’s supreme leader said yesterday that the country is open to a deal with the West on its nuclear program. Why has this affected oil prices so much? If the deal is finalized, it will dramatically increase supply in the market as sanctioned Iranian oil returns to the market, which in the face of weak demand, will send oil prices plummeting. The Canadian dollar is a commodity currency, so a decline in oil prices is a negative factor for the Canadian.

Trading recommendations

• Support levels: 1.3341,1.3320,1.3300,1.3267
• Resistance levels: 1.3410,1.3504,1.3589,1.3647,1.3667,1.3695

From the point of view of technical analysis, the trend on the USD/CAD currency pair in the medium term is bearish. The price is trading at the level of moving averages, the price corridor is forming. The MACD indicator has become positive, the divergence on several time frames remains. There is a high probability of upward corrective movement. It is better to buy from the support level of 1.3341 or 1.3320, but only with confirmation in the form of the buyers’ initiative on the lower time frames. It is better to look for sell deals after a false breakout of the 1.3410 resistance level, but with a confirmation in the form of a reverse initiative.

Alternative scenario:

if the price breaks through and consolidates above the resistance level of 1.3504, the uptrend will resume with a high probability.