The EUR/USD currency pair
- Prev Open: 1.0518
- Prev Close: 1.0441
- % chg. over the last day: -0.73%
The euro fell sharply on Wednesday after European Central Bank President Christine Lagarde said that the era of ultra-low inflation that preceded the pandemic is unlikely to return. Speaking at an ECB forum in Sintra, Portugal, along with US Federal Reserve Chairman Jerome Powell and Bank of England Governor Andrew Bailey, Lagarde added that central banks need to adjust to higher price growth expectations. As before, analysts expect the ECB to raise interest rates by 0.25% in July. A number of inflation data will be released this week in European countries. Germany's preliminary Consumer price level was 7.6% on an annualized basis, down from 7.9% in May. And in Spain, the inflation rate jumped from 8.7% to 10.2% annually.
- Support levels: 1.0425, 1.0379
- Resistance levels: 1.0468, 1.0504, 1.0564, 1.0611, 1.0680, 1.0723
From the technical point of view, the trend on the EUR/USD currency pair on the hourly time frame is bearish. The price is trading below the moving averages, the MACD indicator has become negative, and there is a new sellers' initiative. Under such market conditions, sell deals can be considered from the resistance level of 1.0468, but only after the additional confirmation. Buy trades are best to look for on intraday time frames from the support level of 1.0425, but only with confirmation and short targets.
Alternative scenario: if the price breaks out through the 1.0611 resistance level and fixes above, the uptrend will likely resume.
- – Eurozone German Retail Sales (m/m) at 09:00 (GMT+3);
- – Eurozone French Consumer Price Index (m/m) at 09:45 (GMT+3);
- – Eurozone German Unemployment Rate (m/m) at 10:55 (GMT+3);
- – Eurozone Unemployment Rate (m/m) at 12:00 (GMT+3);
- – US PCE Price index (m/m) at 15:30 (GMT+3);
- – US Initial Jobless Claims (w/w) at 15:30 (GMT+3).
The GBP/USD currency pair
- Prev Open: 1.2182
- Prev Close: 1.2121
- % chg. over the last day: -0.50%
At the Monetary Policy Forum, the Governor of the Bank of England said in his speech that inflation in the UK would continue to rise. When asked about a 50 bp rate hike at the next meeting, the answer was: "If we see greater persistence of inflation, we will have to act more forcefully. The situation leaves options on the table."
- Support levels: 1.2093, 1.1974
- Resistance levels: 1.2171, 1.2238, 1.2324, 1.2422, 1.2470, 1.2523, 1.2629
From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame is bearish. The situation is very similar to the euro. The price is trading below the moving averages, the MACD indicator has become negative, and there is a new sellers' initiative. Under such market conditions, sell deals can be considered from the resistance level of 1.2171, but only after the additional confirmation. Buy trades are best to look for on intraday time frames from the support level of 1.2093, but only with confirmation and short targets.
Alternative scenario: if the price breaks out through the 1.2422 resistance level and fixes above, the uptrend will likely resume.
- – UK GDP (q/q) at 09:00 (GMT+3).
The USD/JPY currency pair
- Prev Open: 136.04
- Prev Close: 136.59
- % chg. over the last day: +0.40%
The fundamental picture of the USD/JPY currency pair remains the same. The divergent policies of the central banks have already caused the yen to fall to 24-year highs against the dollar. Yesterday the former chief executive of the Bank of Japan, Yamaoka, said that the BOJ might have to adjust the yield ceiling if inflation continues to exceed forecasts. But such action would weaken the yen further.
- Support levels: 136.21, 135.45, 134.84, 133.35, 131.67, 131.00, 130.12, 129.48, 128.76
- Resistance levels: 136.66
The medium-term trend on the USD/JPY currency pair is bullish. Buyers' pressure is still present, and the price is steadily growing. The MACD indicator is in the positive zone, but there is divergence in the higher time frames. Under such market conditions, buy trades can be considered from the support level of 136.21, but with confirmation. A resistance level of 136.66 is good for sell deals, but only with additional confirmation and short targets.
Alternative scenario: If the price fixes below 133.35, the downtrend will likely resume.
- – Japan Industrial Production (m/m) at 02:50 (GMT+3).
The USD/CAD currency pair
- Prev Open: 1.2860
- Prev Close: 1.2895
- % chg. over the last day: +0.27%
The Canadian dollar is a commodity currency, so it depends on the US Dollar Index dynamics and oil quotes. The dollar index increased yesterday, while oil prices fell more than 2% in anticipation of the OPEC+ meeting today. As a result, the USD/CAD price started to form a corridor with a slight advantage over the US dollar. It should be noted that the Bank of Canada and the US Federal Reserve are on track to raise interest rates, while the oil market is still in deficit with increased demand over the summer. These facts suggest that no medium-term trends should be expected on the USD/CAD currency pair, as market conditions favor the strengthening of both the US and Canadian dollar.
- Support levels: 1.2831, 1.2709, 1.2618, 1.2578, 1.2510
- Resistance levels: 1.2899, 1.2956, 1.3068
In terms of technical analysis, the trend on the USD/CAD currency pair is bullish. But now, the price has started to form a corridor, and the MACD indicator has become inactive. Under such market conditions, it is better to look for buy deals in the lower time frames from the support level of 1.2831, but with confirmation. For sell deals, it is better to consider the resistance level of 1.2899, but it is also better with confirmation and short targets.
Alternative scenario: if the price breaks through and consolidates below the 1.2831 support level, the downtrend will likely resume.
- – OPEC+ meeting (m/m) at 12:00 (GMT+3);
- – Canada GDP (q/q) at 15:30 (GMT+3).
by , 2022.06.30
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