The Analytical Overview of the Main Currency Pairs on 2023.11.02

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0578
• Prev. Close: 1.0569
• % chg. over the last day: -0.09%

Yesterday, the FOMC committee voted unanimously in favor of keeping the target range for the federal funds rate unchanged at 5.25%-5.50%. According to the FOMC, tighter financial and credit conditions for households and businesses will likely weigh on economic activity, hiring, and inflation. At the press conference, Fed Chairman Powell stated that the Fed may suspend its campaign to raise interest rates indefinitely. Fed Chairman Powell’s comments were dovish, which negatively impacted the dollar index.

Trading recommendations

• Support levels: 1.0551,1.0522,1.0495,1.0483
• Resistance levels: 1.0597,1.0620,1.0670,1.0693,1.0736

The trend on the EUR/USD currency pair on the hourly time frame is a downtrend. Yesterday, the price tested the liquidity below the support level of 1.0522, followed by the reaction of buyers. The MACD indicator became positive, with intraday buying pressure prevailing. The price has now reached the resistance level of 1.0597, which can be considered for selling, subject to sellers’ reaction intraday. Buy deals can be looked for from the support level of 1.0551, but they are also subject to buyers’ reactions.

Alternative scenario:

if the price breaks the resistance level of 1.0670 and consolidates above it, the uptrend is likely to be resumed.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2150
• Prev. Close: 1.27471.2150
• % chg. over the last day: 0.0%

From the point of view of technical analysis, the trend on the GBP/USD currency pair on the hourly time frame is a downtrend. Yesterday, Pound Sterling tested liquidity below Monday’s low, followed by a buyers’ reaction. Price is trading above the moving averages again, with the MACD indicator turning positive. Under such market conditions, sell deals can be sought after testing liquidity above 1.2200, followed by the sellers’ reaction. Sell positions can also be looked at from the resistance level of 1.2233. Buying should be sought from the support level of 1.2157, but only with short targets.

Trading recommendations

• Support levels: 1.2157,1.2088,1.2070
• Resistance levels: 1.2200,1.2233,1.2289,1.2332,1.2384

Alternative scenario: if the price breaks the resistance level at 1.2233 and consolidates above it, the uptrend is likely to be resumed.

Alternative scenario:

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 151.61
• Prev. Close: 150.90
• % chg. over the last day: -0.47%

The yen recovered slightly on Wednesday after hitting a 1-year low against the dollar on Tuesday. The yen rose after Japan’s top currency official said the government is ready to take necessary action in the foreign exchange market. Meanwhile, the latest economic news on Wednesday was favorable for the yen after the October Jibun Bank Manufacturing PMI was revised upward by 0.2 to 48.7 from the previously reported 48.5. But the bearish factor for the yen was the Bank of Japan’s decision to announce an unscheduled bond-buying operation, which will include the purchase of 300 billion yen of 5-10-year debt and 100 billion yen of 3-5-year bonds.

Trading recommendations

• Support levels: 150.31,149.75,149.45,148.80,147.32,147.02,146.76
• Resistance levels: 150.78,151.92

From the technical point of view, the medium-term trend on the currency pair USD/JPY is upward. The price is correcting and is now trading below the moving averages. The MACD indicator has turned negative while selling pressure remains intraday. The price will likely continue to update within the uptrend. Under such market conditions, buy trades are best considered from the support levels of 150.31 or 149.75, but with confirmation in the form of buyer reaction. For selling, the resistance level of 150.78 can be considered, but only with confirmation and short targets.

Alternative scenario:

if the price consolidates below the support level at 148.80, the downtrend is likely to be resumed.

The XAU/USD currency pair (gold)

Technical indicators of the currency pair:

• Prev. Open: 1983.62
• Prev. Close: 1982.43
• % chg. over the last day: -0.06%

Precious metals prices posted moderate losses on Wednesday—the dollar index rally to a 4-week high on Wednesday depressed metals prices. Silver prices came under pressure amid weaker-than-expected news from China and the US on weaker demand for industrial metals following unexpected declines in China’s Caixin manufacturing PMI and US ISM manufacturing PMI for October. But precious metals remain attractive as a safe haven due to increased geopolitical risks in the Middle East.

Trading recommendations

• Support levels: 1962.50,1953.40,1928.04,1907.78,1883.47
• Resistance levels: 1997.24

From the point of view of technical analysis, the trend on the XAU/USD has changed to an upward trend. Currently, the price is trading at the level of moving averages. The MACD indicator has become inactive. Yesterday, the price tested liquidity below the previous support levels, followed by a buyers’ reaction. Under such market conditions, buying can be considered intraday with targets up to the resistance level of 1997.24. But there is a high probability of a deeper correction from current levels, so any entry should be made with confirmation.

Alternative scenario:

if the price breaks and consolidates below the support level of 1953.40, the downtrend will likely resume.