The EUR/USD currency pair
- Prev Open: 0.9981
- Prev Close: 0.9868
- % chg. over the last day: -1.15 %
Fed Funds futures traders still estimate a roughly 67% chance of another Fed Funds interest rate hike of 75 basis points in early November and an almost 70% chance of another 50-75 bps hike by the end of the year. Thus, experts believe that the current decline of the dollar is temporary. Goldman Sachs analysts said there is a 30% chance that the US will go into recession within the next 12 months, but the probability of recession in the Eurozone is twice as high.
- Support levels: 0.9845, 0.9748, 0.9666.
- Resistance levels: 0.9965, 1.0111, 1.0162, 1.0230
From the technical point of view, the trend on the EUR/USD currency pair on the hourly time frame is bullish. The MACD indicator has become inactive, but the price is trading above the average lines, and the buyer's pressure remains high. Buy trades should be considered from the support level of 0.9883. Sell deals can be considered from the resistance level of 1.0058, but only with confirmation.
Alternative scenario: if the price breaks down through the support level of 0.9666 and fixes below it, the downtrend will likely resume.
- – Eurozone ECB Monetary Policy Meeting Accounts at 14:30 (GMT+3);
- – US Initial Jobless Claims (w/w) at 15:30 (GMT+3).
The GBP/USD currency pair
- Prev Open: 1.1462
- Prev Close: 1.1321
- % chg. over the last day: -1.25 %
The British Pound is "frozen in the air" because of the uncertainty of further steps of the British Government. Now the Bank of England has to make a move to balance the situation and not let the British currency plummet to lows again. Analysts believe that the fundamental component still points to GBP/USD quotes decrease due to the difference in the interest rates of the US Federal Reserve and the Bank of England, and also because of the growing problems in the UK, especially in the energy sector, before the coming winter.
- Support levels: 1.1248, 1.1121, 1.0915, 1.0816, 1.0711, 1.03
- Resistance levels: 1.1478, 1.1693, 1.1816, 1.1901
From the technical point of view, the GBP/USD currency pair trend on the hourly time frame is bullish. The MACD indicator has become inactive, but the divergence is still present. Under such market conditions, buy trades can be considered from the support level of 1.1248 or 1.1121, but only with confirmation. Sell trades are best to look for on intraday time frames. The nearest resistance level is 1.1478, but better also with a confirmation in the form of a false breakout since the level has already been tested.
Alternative scenario: if the price breaks down of the 1.0817 support level and fixes below it, the downtrend will likely resume.
- – UK Construction PMI (m/m) at 11:30 (GMT+3).
The USD/JPY currency pair
- Prev Open: 144.06
- Prev Close: 144.67
- % chg. over the last day: +0.42 %
The situation on the USD/JPY currency pair remains the same. The Bank of Japan is keeping its ultra-soft monetary policy and will not change it before the end of the year. The US Federal Reserve, on the contrary, is in a cycle of tightening monetary policy and aggressively raises the interest rate at each of its meetings. Such divergent policy has already caused unprecedented growth of USD/JPY quotes for the last half a year, which resulted in the Ministry of Finance of Japan conducting an intervention in currency and informing to defend the level of 145. The problem is that the situation has not changed fundamentally, and USD/JPY is inclined to grow. The question is whether the Ministry of Finance of Japan has enough courage and resources to intervene more to hold the rate.
- Support levels: 143.00, 140.60, 139.61, 138.78, 137.65, 136.80, 135.20
- Resistance levels: 144.66, 145.35
From the technical point of view, the medium-term trend on the currency pair USD/JPY is bullish. The MACD indicator has become inactive, and the price is trading at the level of moving averages. Under such market conditions, buy trades can be searched for on intraday time frames from the support level of 143.00, but with confirmation. Sell deals can be searched from the resistance level of 144.66 or 145.35, but only with additional confirmation.
Alternative scenario: If the price fixes below 140.60, the downtrend will likely resume.
- – Japan BOJ Gov Kuroda Speaks at 03: (Tentative).
The USD/CAD currency pair
- Prev Open: 1.3517
- Prev Close: 1.3617
- % chg. over the last day: +0.74 %
The Canadian dollar is a commodity currency and depends on the performance of the dollar index and oil prices. Yesterday, the OPEC+ countries agreed to cut oil production by 2 million barrels daily. Oil producers do not want to allow oil prices to fall and keep the price of "black gold" above $90 per barrel. After this statement, Goldman Sachs has increased at once by $10 up to $110 by the end of the year. Thus, the growth in oil prices can trigger a new round of inflation acceleration on the background of growing energy prices. However, the Canadian dollar will only benefit from it and will get stronger as oil prices go up.
- Support levels: 1.3434, 1.3297, 1.3212, 1.3053, 1.2990, 1.2958
- Resistance levels: 1.3660, 1.3755, 1.3858, 1.3968
From the point of view of technical analysis, the trend on the USD/CAD currency pair is bearish. The price is trading below the moving lines. The MACD indicator has become inactive. Under such market conditions, buy trades should be considered on the lower time frames from the support level of 1.3534, but with confirmation. For sell deals, it is better to consider the resistance level of 1.3660 or 1.3756, but only after the additional confirmation.
Alternative scenario: if the price breaks out through and consolidates above the resistance level of 1.3756, the uptrend will likely resume.
- – Canada Ivey PMI (m/m) at 17:00 (GMT+3).
by , 2022.10.06
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