The Analytical Overview of the Main Currency Pairs on 2024.06.24

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0702
• Prev. Close: 1.0692
• % chg. over the last day: -0.09%

The euro extended losses to $1.067 after weaker-than-expected June PMIs added to fears of a deterioration in the Еuro zone’s economic performance, raising bets that the ECB may cut interest rates further. Flash PMI indices showed that both the manufacturing and services sectors unexpectedly contracted at a faster pace in Germany, France, and the Eurozone.

Trading recommendations

• Support levels: 1.0693,1.0666,1.0590
• Resistance levels: 1.0710,1.0732,1.0756,1.0773,1.0817

The trend on the EUR/USD currency pair on the hourly time frame is bearish. The price has consolidated below the support level 1.0730 and is now trading below the moving average lines. The price has reached the demand zone below 1.0693, where buyers react moderately. The latest volume spike indicates that some previously opened sales have been covered. Under such market conditions, intraday buying from the support level of 1.0693 with a target of 1.0710 is worth looking for. A price move below 1.0685 will open the way to 1.0666.

Alternative scenario:

if the price breaks the resistance level of 1.0816 and consolidates above it, the uptrend will likely resume.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2651
• Prev. Close: 1.2641
• % chg. over the last day: -0.08%

According to the latest S&P Global Flash UK PMI report, business activity in the UK private sector grew in June at the slowest pace since last November. This reflects uncertainty over business conditions ahead of the general election. The report shows that service inflation remains high in the UK but is forecast to fall in the coming months. Financial markets are now pricing in the likelihood of a 25 basis point rate cut at the Bank of England’s August meeting and a total of just under 50 basis points of rate cuts this year.

Trading recommendations

• Support levels: 1.2623,1.2602,1.2566
• Resistance levels: 1.2656,1.2693,1.2735,1.2806

From the point of view of technical analysis, the trend on the GBP/USD currency pair is bearish. The price declined to the 1.2623 support level, where buyers showed a moderate reaction, which is confirmed by the bullish reaction to the volume growth. The presence of MACD divergence indicates the beginning of corrective movement. The minimum target of correction is 1.2656. Further, depending on the price reaction, the price will either return to the decline or, after the breakdown, will rush to 1.2693.

Alternative scenario:

if the price breaks the resistance level at 1.2735 and consolidates above, the uptrend will likely resume.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 158.91
• Prev. Close: 159.75
• % chg. over the last day: +0.52%

The Japanese yen almost reached 160 per USD as the Bank of Japan officials disagree on the next interest rate hike. The Bank of Japan will need more data before gaining the confidence for another interest rate hike. Demand-driven inflation, as opposed to supply-driven price pressures, is the key determinant of the BoJ’s attitude toward inflation.

Trading recommendations

• Support levels: 159.00,158.23,157.59,157.33,156.56
• Resistance levels: 160.20

From a technical point of view, the medium-term trend of the currency pair USD/JPY is bullish. The Japanese continued losing positions against the dollar and approached the intervention levels again. The price seeks to test the liquidity level above 160.20, where buyers will likely start closing some previously opened positions, leading to a small correction. Using moving lines or intraday support levels is best to join the trend.

Alternative scenario:

if the price breaks below the support level of 157.59, the downtrend will likely resume.

The XAU/USD currency pair (gold)

Technical indicators of the currency pair:

• Prev. Open: 2360
• Prev. Close: 2321
• % chg. over the last day: -1.68%

Gold held near $2,320 per ounce on Monday after falling more than 1% in the previous session, driven by a stronger dollar and rising bond yields after reports of strong US business activity. Data released last week showed business activity hit a 26-month high in June thanks to job growth, while initial jobless claims fell only slightly. Investors are now awaiting this week’s economic data, including Friday’s PCE price index, which is the Fed’s preferred inflation gauge. Meanwhile, official data showed that gold exports from Switzerland declined in May due to lower shipments to India and Hong Kong, while gold demand in India, the world’s second-largest gold consumer, slowed last week.

Trading recommendations

• Support levels: 2318,2352,2307,2300
• Resistance levels: 2351,2370,2387

From the point of view of technical analysis, the trend on the XAU/USD is still bearish. On Friday, the price fell impulsively to the 2318 support level, missing several support zones simultaneously. Recent volumes indicate some selling coverage. Increasing geopolitical risk in the Middle East may support gold prices in the coming days, so the 2318 support level can be considered a basis for the upside. A price consolidation below 2318 would open the way to 2307.

Alternative scenario:

if the price breaks above the resistance level of 2387, the uptrend will likely resume.