The Analytical Overview of the Main Currency Pairs on 2021.02.01

The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2122
• Prev. Close: 1.2135
• % chg. over the last day: +0.11%.

EUR/USD continues to consolidate after falling in the first half of January. Having formed a range of 120 points, the pair seems to have been stuck in it for a long time and additional drivers are needed to exit in one direction or another. This week will be rich in economic data which could trigger increased volatility.

Trading recommendations

• Support levels: 1.2077,1.2059
• Resistance levels: 1.2189,1.2222,1.2283

The main trading scenario for EUR/USD is trading in a sideways range between 1.2094 and 1.2155. 1.2059 level remains important. In case of its breakthrough, the southern correction will resume in a new wave. The MACD is near zero. The ADX only reacts to price declines. Since the price is stuck close to the moving averages, the total result for all signals is neutral.

Alternative scenario:

if the price can gain a foothold above the level of 1.2155, the pair may move to an increase to 1.2222. The breakthrough of 1.2059 will resume a wave of sales.

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.3717
• Prev. Close: 1.3702
• % chg. over the last day: -0.11%

The British pound continues to trade near its annual highs. This week traders are waiting for a meeting of the Bank of England, which should clarify whether it is going to keep strengthening the monetary stimulus of the economy. The majority of economists are inclined to believe that the regulator will leave the stimulus at the same level, which will support the sterling bulls.

Trading recommendations

• Support levels: 1.3622,1.3517
• Resistance levels: 1.3744,1.4386

The main scenario for the GBP/USD pair is trading sideways between 1.3622 and 1.3744. The pair trades strictly from support to resistance level and intraday movements look rather chaotic. During the Asian session, the growth of quotations was accompanied by a significant reaction of the ADX and the MACD, which increased the likelihood of a breakthrough of the upper line of the range.

Alternative scenario:

if the pair consolidates above 1.3744, it is likely to resume movement up to 1.3800. A breakthrough at the 1.3622 level could trigger a further fall towards 1.3517.

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev. Open: 104.23
• Prev. Close: 104.70
• % chg. over the last day: +0.45%

The growth of the dollar-yen pair continues to gain momentum. Despite the absence of a change in the dollar index quotes on Friday, the pair showed a strong bullish momentum amid rising Treasury yields. On the daily timeframe, the pair has consolidated above the moving averages, which suggests the beginning of a deep northern correction.

Trading recommendations

• Support levels: 104.40,103.56
• Resistance levels: 104.94,105.68

The main scenario is buying on a decline. The ADX shows a decrease in upside potential, but this is due to consolidation in a narrow price range. As long as the price is above the moving averages, all specifications will indicate growth.

Alternative scenario:

An alternative scenario assumes the price fixing below 104.40. In this case, the pair may return to the previous trading range of 104.40 – 103.56.

The USD/CAD currency pair

Technical indicators of the currency pair:

• Prev. Open: 1.2826
• Prev. Close: 1.2771
• % chg. over the last day: -0.43%

The movement of the pair on Friday indicates that there is strong resistance in the area of 1.2875. The news background was in favor of the Canadian currency. The GDP growth in November was more significant than economists expected. A 0.7% increase indicates a more positive end of the fourth quarter of last year.

Trading recommendations

• Support levels: 1.2737,1.2686
• Resistance levels: 1.2875,1.2932

The main scenario is selling. All technical indicators were sharply redirected. The price consolidated below the moving averages. The MACD has sharply moved into the negative area. The ADX is still faintly reacting to the price decline. The Monday trading may be sluggish, and the decline will be limited by the first resistance level.

Alternative scenario:

if the price consolidates above 1.2815, the pair may resume its growth.