The Analytical Overview of the Main Currency Pairs on 2024.12.06

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.0508
• Prev. Close: 1.0586
• % chg. over the last day: +0.74 %

The Eurozone economy continues to struggle, with the latest PMI data showing that private sector activity has started to contract again. During a parliamentary hearing, ECB President Lagarde warned that Eurozone growth could weaken in the coming months, with downside risks dominating the medium term. The ECB is expected to cut the key deposit rate by another 25 bps next week, although there is growing market speculation of a larger 50 bps rate cut.

Trading recommendations

• Support levels: 1.0550, 1.0504, 1.0449, 1.0233
• Resistance levels: 1.0609, 1.0654, 1.0714

The EUR/USD currency pair’s hourly trend is bearish but close to change. Yesterday, the price broke through an important resistance level and is now approaching the priority change level. But there is a slight selling pressure intraday. Buying can be considered from 1.0550 or 1.0504, provided buyers react to liquidity below the levels. For selling, 1.0609 can be considered, provided sellers react accordingly.

Alternative scenario:

if the price breaks the resistance level of 1.0609 and consolidates above it, the uptrend will be resumed with a high probability.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2701
• Prev. Close: 1.2759
• % chg. over the last day: +0.46 %

No significant economic news is expected in the UK today. However, the US Non-Farm Payrolls labor market report will indirectly impact the British currency. If the data turns out to be better than forecasts, it will be a positive factor for the US dollar, allowing the US Fed to be more aggressive at the December meeting. A rise in the US dollar on the report will put pressure on risk assets, particularly the British currency. If the actual data turns out to be worse than expected, this scenario will likely put pressure on the dollar index, which will favor the pound.

Trading recommendations

• Support levels: 1.2686, 1.2633, 1.2567, 1.2487
• Resistance levels: 1.2770, 1.2878, 1.2905, 1.2982, 1.3023

From the technical analysis point of view, the trend on the GBP/USD currency pair is bullish. Yesterday, the price reached the important resistance level of 1.2770, where the fixation of positions began, leading to a slight decline. But today, on the test of new liquidity above, the decline may accelerate if sellers show a reaction. For selling, it is best to consider 1.2770, but with confirmation. The nearest level for buying is 1.2686.

Alternative scenario:

if the price breaks the support level at 1.2526 and consolidates below, the downtrend is likely to be resumed.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 150.55
• Prev. Close: 150.11
• % chg. over the last day: -0.29 %

Japan’s index of leading economic indicators, which gauges the economic outlook for the coming months based on data such as job offers and consumer sentiment, fell to 108.6, below the market’s forecast of 108.9. The latest data came after the unemployment rate rose to 2.5% in October from September’s eight-month low. At the same time, the services sector contracted for the first time since June, and factory activity fell by the most in seven months amid easing price pressures.

Trading recommendations

• Support levels: 149.42, 149.67, 147.34
• Resistance levels: 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 situation has not changed much since yesterday. After testing the liquidity above 150.76, the price returned to the downside. Currently, the price is trying to test the liquidity below 149.42. If the buyers do not react here, a strong sell-off to 147.34 may follow. If the buyers react at 149.42, intraday short buying may be considered.

Alternative scenario:

if the price breaks above the resistance level at 151.95, the uptrend is likely to resume.

The XAU/USD currency pair (gold)

Technical indicators of the currency pair:

• Prev. Open: 2649
• Prev. Close: 2631
• % chg. over the last day: -0.68 %

Gold recovered to $2640 on Friday, cutting the previous session’s losses as markets awaited fresh data from the US to get a glimpse of the Federal Reserve’s monetary policy. The data showed that the number of Americans filing new applications for unemployment benefits rose last week, indicating a gradual cooling of the labor market. This comes before the release of an important US non-farm payrolls report scheduled for Friday, the next major data point before the Fed policymakers meet in mid-December.

Trading recommendations

• Support levels: 2618, 2606, 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. Yesterday, sellers took the initiative, which led to the price decline to the level of priority change. Buyers bought the price back sharply, but the selling pressure in the intraday remains. Sell trades can be considered from 2643 but with confirmation. The nearest level to buy is 2618. However, a breakout of the 2643 resistance level could trigger a sharp upward momentum.

Alternative scenario:

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