The Analytical Overview of the Main Currency Pairs on 2024.10.10

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0970
• Prev. Close: 1.0939
• % chg. over the last day: -0.28 %

Positive comments from Fed Vice-Chairman Jefferson helped the dollar yesterday when he said the US economy is growing at a “robust pace.” The dollar’s strength on Wednesday put pressure on the euro. In addition, dovish comments from ECB Governing Council representatives Kazakz and Villeroy de Gallo-Nagel on Wednesday were negative for the euro when they stated their support for additional interest rate cuts by the ECB at its next meeting.

Trading recommendations

• Support levels: 1,0918
• Resistance levels: 1.0950, 1.0979, 1.1013, 1.1036, 1.1079, 1.1136, 1.1163

The EUR/USD currency pair’s hourly trend is bearish. Despite the MACD divergence, sellers remain under pressure. Given the price fixation below 1.0950, the price aims to test liquidity below 1.0915. Selling can be considered from both moving average levels and resistance at 1.0950. There are no optimal entry points for buying right now.

Alternative scenario:

if the price breaks the resistance level at 1.1099 and consolidates above it, the uptrend will likely resume.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.3086
• Prev. Close: 1.3069
• % chg. over the last day: -0.13 %

The situation has mostly stayed the same. Bank of England policymakers are signaling a more active approach to lowering interest rates, which puts pressure on the British currency. Investors are now awaiting the GDP data for the month, which is predicted to show a modest growth of 0.2%. But even this could be enough to give the pound back the initiative against the dollar.

Trading recommendations

• Support levels: 1.3047, 1.3035
• Resistance levels: 1.3105, 1.3175, 1.3290, 1.3327, 1.3377, 1.3389

From the point of view of technical analysis, the trend on the GBP/USD currency pair is bearish. Intraday sellers are pushing the price lower, but the price is slowly moving into a flat accumulation stage. Given the divergence on MACD, sellers will likely try to test the liquidity below the support level of 1.3047, where we can look for buying, provided the initiative from buyers on the lower time frames.

Alternative scenario:

if the price breaks the resistance level at 1.3306 and consolidates above it, the uptrend will likely resume.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 148.18
• Prev. Close: 149.29
• % chg. over the last day: +0.75 %

On Wednesday, the yen fell to a 2-month low against the dollar on weak Japanese economic news, which showed that Japan’s machine tool orders fell the most in 5 months. Former BoJ Governor Maeda said January is the “most likely” time frame for the next interest rate hike when the BoJ releases its latest economic forecasts. Swaps estimate the odds of a 10 bps BoJ rate hike at 3% for the Oct 30-31 meeting and 24% for a 10 bps hike for the Dec 18-19 meeting.

Trading recommendations

• Support levels: 149.03, 147.50, 146.90, 146.02, 144.20, 143.53, 142.22
• Resistance levels: 149.37, 151.26

From a technical point of view, the medium-term trend of the USD/JPY currency pair is bullish. The price finally reached the resistance zone above 149.37, but no seller reacted. The MACD divergence is traced on several timeframes, which increases the probability of corrective movement from this area. Buyers formed a support level at 149.03 to support the up move, so it is necessary to evaluate the price reaction. Price reaction at 149.03 and consolidation above 149.37 will open the way for the price to 151. A price consolidation below 149.03 will trigger a correction to 147.50.

Alternative scenario:

if the price breakdown the support level of 146.90, the downtrend will likely resume.

The XAU/USD currency pair (gold)

Technical indicators of the currency pair:

• Prev. Open: 2622
• Prev. Close: 2608
• % chg. over the last day: -0.54 %

On Wednesday, gold prices fell for the sixth consecutive session to below $2610 per ounce, the lowest level in about three weeks. Pressure on prices came from a strengthening dollar. Don’t forget that gold has an inverse correlation with government bond yields, which are highly correlated with the dollar index. Even though this correlation has weakened a bit recently, we should not rule out the dependence of gold on the dollar. Nevertheless, the attractiveness of gold as a safe-haven asset remains amid concerns about the conflict in the Middle East.

Trading recommendations

• Support levels: 2605, 2584, 2574, 2561, 2541, 2528, 2522
• Resistance levels: 2624, 2632, 2669, 2700

From the point of view of technical analysis, the trend on the XAU/USD is bullish. Gold is forming a broadly volatile flat in the 2650-2624 range. There is selling pressure inside the day, but considering the MACD divergence, there is a high probability that the buyers will take the initiative. Buying should be considered from 2605, provided the buyers react again. Selling should be considered from 2624, also with confirmation. A move and consolidation of the price below 2600 is highly undesirable for holding the medium-term uptrend.

Alternative scenario:

if the price breakdown the support level of 2569, the downtrend will likely resume.