The Analytical Overview of the Main Currency Pairs on 2023.11.27

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0902
• Prev. Close: 1.0901
• % chg. over the last day: +0.29%

The dollar retreated on Friday after economic news showed that the US manufacturing PMI for November declined more than expected. The S&P Manufacturing PMI fell by 0.6 to 49.4, weaker than the expected 49.9. In addition, the strengthening of the euro on Friday impacted the dollar after the German IFO Business Climate Index for November rose by 0.4 to a 4-month high of 87.3. With the US Fed monetary policy becoming more dovish, while the ECB remains more hawkish, EUR/USD will slowly move upwards in the medium term.

Trading recommendations

• Support levels: 1.0927,1.0887,1.0851,1.0822,1.0756,1.0729,1.0700,1.0664
• Resistance levels: 1.0945,1.0964,1.0983,1.1004

The trend on the EUR/USD currency pair on the hourly time frame is bullish. Again, the price is trading above the moving averages. The MACD indicator has returned to positive territory, and there is weak buying pressure intraday, but the price has reached the resistance level. Under these market conditions, buying is better to consider after testing the support level of 1.0927, but with confirmation. If the breakdown of 1.0945, the price is likely to try to test liquidity above 1.0964. Selling can be considered from the resistance level of 1.0945, but only with confirmation on the lower time frames in the form of sellers’ initiative.

Alternative scenario:

if the price breaks the support level of 1.0824 and consolidates below it, the downtrend will likely resume.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2527
• Prev. Close: 1.27471.2595
• % chg. over the last day: +0.54%

The British pound sterling returned to highs which have not been seen since the beginning of September. The main beneficiaries of the currency’s rise are the decline in the dollar index as well as strong recent economic data. The Purchasing Managers’ Index (PMI) for November showed an unexpected increase in activity in the dominant services sector. It returned to growth after four months of decline. The manufacturing sector, for its part, remained in contraction, but to a lesser extent than economists had expected. However, no important UK economic data is expected this week, and with the USD likely to get temporary support this week from GDP and manufacturing data, there is a high probability of a correction in GBP/USD.

Trading recommendations

• Support levels: 1.2559,1.2522,1.2478,1.2438,1.2373,1.2347,1.2309,1.2186
• Resistance levels: 1.2641,1.2764

From the point of view of technical analysis, the trend on the GBP/USD currency pair on the hourly time frame is bullish. The price is confidently breaking through the resistance levels and is trading above the moving averages. The MACD indicator is in the positive zone, but the divergence persists and widens, indicating that the upward momentum is running out. Buying is best sought from the moving averages with confirmation on intraday time frames and short targets. Selling can be sought intraday after a liquidity test above 1.2641.

Alternative scenario:

if the price breaks the support level of 1.2373 and consolidates below, the downtrend will likely resume.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 149.52
• Prev. Close: 149.43
• % chg. over the last day: -0.06%

Japan’s factory activity contracted for a sixth straight month in November, while modest growth in the services sector was little changed, a business survey showed on Friday, underscoring the economy’s fragility amid weak demand and inflation. Output and new orders fell further in November, while the pace of decline in incoming orders accelerated. This is a negative sign for the Japanese currency, as the Bank of Japan needs strong economic data, especially on manufacturing activity, to exit ultra-soft monetary policy.

Trading recommendations

• Support levels: 148.86,148.32,147.82,147.32,147.02,146.76
• Resistance levels: 149.42,149.75,150.15,150.93,151.43,151.91

From the technical point of view, the medium-term trend on the currency pair USD/JPY is still bearish, but it is close to changing. On Friday, sellers showed initiative from the resistance level of 149.75, and now the price is going down to the support level of 148.86, which was tested earlier. The MACD indicator has turned negative, and sellers are dominating intraday again. Buying can be looked for intraday from the support level of 148.32 but with confirmation. Selling is best considered from the resistance level at 149.42.

Alternative scenario:

if the price consolidates above the resistance level of 150.14, the uptrend will likely resume.

The XAU/USD currency pair (gold)

Technical indicators of the currency pair:

• Prev. Open: 1993
• Prev. Close: 2001
• % chg. over the last day: +0.40%

Precious metals prices rose moderately on Friday, with silver reaching a 2.5-month high. The weakening of the dollar on Friday was a bullish factor for metal prices. In addition, precious metals were supported by dovish comments from ECB President Lagarde, who said she favors a pause in ECB rate hikes. In the medium and long term, gold still has prerequisites for growth against the background of future interest rate cuts by the leading central banks.

Trading recommendations

• Support levels: 1998,1979,1955,1933,1918
• Resistance levels: 2009,2022

From the point of view of technical analysis, the trend on the XAU/USD is bullish. On Friday, the price continued its upward movement, and today, at the opening, it showed a bullish impulse and held above the psychological mark of 2000. The MACD indicator has become positive, with prices trading solidly above the moving averages. Under such market conditions, it is best to buy from the moving average lines with a target of 2021.79. Selling can be considered only after the sellers’ impulsive initiative from the resistance level of 2009 or 2022. At the moment, such conditions have not been formed.

Alternative scenario:

if the price breaks below the support level of 1955, the downtrend will likely resume.