The Analytical Overview of the Main Currency Pairs on 2024.12.04

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0497
• Prev. Close: 1.0508
• % chg. over the last day: +0.10 %

The euro is trading at 1.0500 per USD, partially recovering from Monday’s 0.8% drop as political turmoil in France increased market uncertainty. The currency remains under pressure amid fears of a government collapse in France, where Prime Minister Michel Barnier is facing a vote of no confidence due to a controversial budget plan that includes tax hikes and spending cuts. As for monetary policy, markets are increasingly factoring in the possibility of a 50 basis point rate cut in December, although a 25 basis point rate cut remains more likely. Over the past month, the euro has lost 3% against the dollar and more than 1% against the pound sterling and Swiss franc.

Trading recommendations

• Support levels: 1.0490, 1.0449, 1.0233
• Resistance levels: 1.0515, 1.0539, 1.0568, 1.0609, 1.0654, 1.0714

The EUR/USD currency pair’s hourly trend is bearish. The situation has not changed significantly compared to yesterday. There is still a high probability of a price drop to 1.0425. For sell deals, we can consider the levels of 1.0515 or 1.0539, but with confirmation. There are no optimal entry points for buying now.

Alternative scenario:

if the price breaks the resistance level of 1.0609 and consolidates above it, the uptrend will likely resume.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2652
• Prev. Close: 1.2673
• % chg. over the last day: +0.17 %

The Bank of England warned yesterday that higher trade barriers could hurt global growth, create uncertainty over inflation, and raise borrowing costs. Meanwhile, markets expect the Bank of England to cut rates by 75 basis points by 2025. Attention will now turn to the Bank of England’s December 5 BoE meeting, which could provide further insight into inflation expectations and the Central Bank’s monetary policy course.

Trading recommendations

• Support levels: 1.2633, 1.2567, 1.2487
• Resistance levels: 1.2691, 1.2726, 1.2766, 1.2878, 1.2905, 1.2982, 1.3023

From the point of view of technical analysis, the trend on the GBP/USD currency pair is bullish. Buyers were able to raise the price again to the resistance level of 1.2691, but since the targets below were not reached, there is a high probability of another downward wave. Under these market conditions, sell trades are best sought from 1.2691 or 1.2726, subject to sellers’ reaction. There are no optimal entry points for buying right now.

Alternative scenario:

if the price breaks the support level at 1.2526 and consolidates below, the downtrend will likely resume.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 149.57
• Prev. Close: 149.59
• % chg. over the last day: +0.01 %

The Japanese yen fell to 150 per dollar, retreating from recent highs, as the market remains divided over the timing of future interest rate hikes by the Bank of Japan. Bank of Japan Governor Kazuo Ueda signaled over the weekend that an additional rate hike is “not far off” as economic data continues to align with expectations. He also emphasized the importance of momentum from the 2025 wage negotiations. Markets are currently pricing in a 60% chance of a 25 basis point rate hike in Japan this month, up from around 50% in recent weeks.

Trading recommendations

• Support levels: 149.23, 149.67, 147.34
• Resistance levels: 150.24, 150.76, 151.96, 153.23, 154.71, 155.25

From a technical point of view, the medium-term trend of the USD/JPY currency pair is a downtrend. The narrowing channel plus divergence on the MACD indicator indicates a corrective movement. Buyers need to break through the intermediate resistance level at 150.24. This will open the price way up to 150.76, where we can look for sales to continue the trend. The support level of 149.23 can be considered for buying, but only with confirmation.

Alternative scenario:

if the price breaks above the resistance level of 151.95, the uptrend will likely resume.

The XAU/USD currency pair (gold)

Technical indicators of the currency pair:

• Prev. Open: 2639
• Prev. Close: 2644
• % chg. over the last day: +0.19 %

Gold held above the $2,640 per ounce mark on Wednesday as markets continued to assess the political and monetary outlook, closely following the release of key economic data. A recent report showed that US job openings came in above expectations, indicating continued stability in the labor market. Meanwhile, amid political uncertainty in South Korea and France, the metal is in demand.

Trading recommendations

• Support levels: 2618, 2580, 2559, 2471
• Resistance levels: 2655, 2667, 2704, 2708, 2733, 2749

From the point of view of technical analysis, the trend on the XAU/USD is bullish, but close to change. Volatility on gold is low. Price is forming a narrow corridor inside a broader flat accumulation. However, as the price has not reached the lower targets, further price decline is expected. Sell trades can be considered from 2655 or 2667 but with confirmation. There are no optimal entry points for buying right now.

Alternative scenario:

if the price breaks and consolidates below the support level of 2618, the downtrend will likely resume.