The Analytical Overview of the Main Currency Pairs on 2023.06.21

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0919
• Prev. Close: 1.0917
• % chg. over the last day: -0.02%

The head of Lithuania’s Central Bank described the interest rate hike planned for July as “almost obvious,” stressing that core inflation in the eurozone remains solid. After last week’s upward revision to inflation forecasts, some ECB officials warned that rate hikes may have to be maintained beyond the July meeting. Economists believe the ECB will end its tightening cycle this fall.

Trading recommendations

• Support levels: 1.0845,1.0785,1.0719,1.0688,1.0659,1.0634
• Resistance levels: 1.0942,1.0956,1.0968,1.0995

Alternative scenario:

The EUR/USD currency pair trend on the hourly time frame has changed to bullish. The price is forming a narrow corridor on the levels of the moving averages. The MACD indicator has become inactive. Under such market conditions, buy trades can be considered after a small correction from the support level of 1.0845, but only with additional confirmation on the lower time frames. Sell deals can be considered from the resistance level of 1.0942 or 1.0968, but also with confirmation on the lower time frames.

Technical indicators of the currency pair:

Trading recommendations

The EUR/USD currency pair trend on the hourly time frame has changed to bullish. The price is forming a narrow corridor on the levels of the moving averages. The MACD indicator has become inactive. Under such market conditions, buy trades can be considered after a small correction from the support level of 1.0845, but only with additional confirmation on the lower time frames. Sell deals can be considered from the resistance level of 1.0942 or 1.0968, but also with confirmation on the lower time frames.

Alternative scenario:

if the price breaks through the support level of 1.0785 and fixes below it, the downtrend will likely resume.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2782
• Prev. Close: 1.2763
• % chg. over the last day: -0.08%

Today, the UK will publish consumer (CPI) and factory (PPI) inflation data. Inflationary pressures are expected to continue to moderate. The CPI is forecast to fall from 8.7% to 8.4% on an annualized basis, and core inflation (excluding food and energy prices) is expected to remain unchanged. If inflation readings turn out to be higher than forecast amid a robust labor market, the Bank of England may well decide to raise interest rates by 50 basis points on Thursday.

Trading recommendations

• Support levels: 1.2677,1.2627,1.2539,1.2486,1.2421,1.2391,1.2349
• Resistance levels: 1.2801,1.2991

From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame is bullish. The price is trading at the level of the moving averages. The MACD indicator has become inactive. There is a high probability of correction to the nearest support levels. The most optimal level to buy is 1.2677 but with confirmation. It is best to consider sell deals from the resistance level of 1.2801 but with confirmation.

Alternative scenario:

if the price breaks through the support level 1.2538 and fixes below it, the downtrend will most likely resume.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 141.96
• Prev. Close: 141.42
• % chg. over the last day: -0.38%

Bank of Japan board spokesman Seiji Adachi said that it is too early to abandon ultra-soft monetary policy due to uncertainty over the price outlook. While consumer inflation in Japan is accelerating at a faster pace than originally expected, risks to the long-term price outlook have been shifted downward due to growing signs of weakness in the global economy. Adachi also added that there is now no need to adjust the level of the YCC yield curve.

Trading recommendations

• Support levels: 141.23,140.16,139.85,139.23,138.81
• Resistance levels: 142.12,142.45

From the technical point of view, the medium-term trend on the currency pair USD/JPY is bullish. The price is trading above the levels of the moving averages and forming a volatile corridor. The MACD indicator is inactive. The most suitable level to buy would be 141.23 or 140.16 but with confirmation on the lower time frames. Sell trades can be considered from a resistance level of 142.12 but with confirmation in the form of a bearish initiative.

Alternative scenario:

if the price fixes below the 139.85 support level, with a high probability the downtrend will resume.

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.3208
• Prev. Close: 1.3232
• % chg. over the last day: +0.18%

The retail sales report will be released today in Canada. This report will show how consumers are feeling at a time of high-interest rates. If the data shows a decline, it is negative for the CAD. Also, keep in mind that the Canadian dollar is a commodities currency and is highly dependent on such parameters as the dollar index and oil. Today traders will be watching Powell’s monetary policy testimony before the US House Committee. Any hawkish statements may give a boost to the dollar index.

Trading recommendations

• Support levels: 1.3196,1.3135
• Resistance levels: 1.3240,1.3293,1.3317,1.3357,1.3384,1.3461,1.3503

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 MACD indicator has become inactive. It is best to look for buy deals from the 1.3196 support level but with confirmation on the lower time frames. Sell trades are best sought from the resistance level of 1.3240 or 1.3293 but with confirmation in the form of reverse initiative.

Alternative scenario:

if the price breaks through and consolidates above the resistance level of 1.3355, the uptrend will resume with a high probability.