The EUR/USD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.0737
• Prev Close: 1.0745
• % chg. over the last day: +0.07%

The euro rose slightly yesterday after ECB policymakers signaled that they need more evidence that price pressures are under control. According to flash estimates, the Eurozone's annual inflation rate fell to 2.5% in June, matching expectations. The core measure, which excludes volatile items such as food and energy, was unexpectedly unchanged. Inflation rates in Germany, France, and Spain slowed, while in Italy rose to 0.9%. Despite this, ECB President Lagarde told the ECB Forum that the central bank does not yet have sufficient evidence that inflationary threats have passed.

Trading recommendations

• Support levels: 1.0727, 1.0718, 1.0685, 1.0666, 1.0590
• Resistance levels: 1.0748, 1.0773, 1.0837

The trend on the EUR/USD currency pair on the hourly time frame is bearish. Yesterday, the price tested the support level at 1.0718, and the buyers took the initiative. The price rebounded and reached the resistance level 1.0748, where sellers came into play. Today, there may be increased volatility in the euro due to the publication of the FOMC minutes. Support levels of 1.0727 and 1.0718 can be considered for buying. A breakout of 1.0748 will open the way for the price to the level of 1.0772 priority change. A breakdown of 1.0718 may trigger a sell-off to 1.0685.

Alternative scenario: if the price breaks the resistance level of 1.0772 and consolidates above it, the uptrend will likely resume.

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News feed for 2024.07.03:

• – German Services PMI (m/m) at 10:55 (GMT+3);
• – Eurozone Services PMI (m/m) at 11:00 (GMT+3);
• – Eurozone Producer Price Index (m/m) at 12:00 (GMT+3);
• – US ADP Nonfarm Employment Change (m/m) at 15:15 (GMT+3);
• – US Initial Jobless Claims (m/m) at 15:30 (GMT+3);
• – US Trade Balance (m/m) at 15:30 (GMT+3);
• – US ISM Services PMI (m/m) at 17:00 (GMT+3);
• – Eurozone ECB President Lagarde Speaks at 17:15 (GMT+3);
• – US FOMC Meeting Minutes at 21:00 (GMT+3).
   

The GBP/USD currency pair

Technical indicators of the currency pair:

• Prev Open: 1.2640
• Prev Close: 1.2684
• % chg. over the last day: +0.34 %

Parliamentary elections will be held in the UK as early as tomorrow. Opinion polls predict a significant defeat for the Conservative Party, which has been in power for 14 years. Against this backdrop, the British pound has received support as Labor may bring a new breath of air to the British economy, especially regarding resuming trade relations with the European Union. But we should not expect further strengthening of the pound, as according to economists, the victory of the opposition Labor Party is already priced in.

Trading recommendations

• Support levels: 1.2663, 1.2653, 1.2623, 1.2602, 1.2566
• Resistance levels: 1.2692, 1.2702, 1.2735, 1.2806

From the point of view of technical analysis, the trend on the GBP/USD currency pair is bearish. Yesterday, the price approached the priority change level again, but the resistance level of 1.2692 may become a problem for buyers. Now the price may be correct to the demand zone at 1.2653-1.2663, where we can look for a purchase but with confirmation. Selling can be considered intraday, with a stop loss behind the priority change level 1.2702.

Alternative scenario: if the price breaks the resistance level at 1.2701 and consolidates above, the uptrend will be resumed.

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News feed for 2024.07.03:

• – UK Services PMI (m/m) at 11:30 (GMT+3).
   

The USD/JPY currency pair

Technical indicators of the currency pair:

• Prev Open: 161.41
• Prev Close: 161.41
• % chg. over the last day: 0.0%

The Japanese yen held near 161.6 per dollar, which was near its lowest level since 1986, making the markets fear another government intervention. A lack of urgency from the Bank of Japan to normalize monetary policy is also weighing on the yen, although there is growing speculation that the BOJ may raise rates at its next meeting in late July. The central bank noted that a weak yen raises the cost of imports, which increases inflationary pressures and negatively affects household consumption.

Trading recommendations

• Support levels: 160.80, 160.00, 159.00, 158.23, 157.59, 157.33, 156.56
• Resistance levels: 162.00

From a technical point of view, the medium-term trend of the currency pair USD/JPY is bullish. The volumes still indicate the presence of a big buyer. The price consolidated above the resistance at 161.50, and now this level has mirrored support. The presence of divergence on the MACD indicates a correction, but there is no confirmation from the sellers yet. To make profits, we should consider round levels — 162, 162.50, etc. For sell deals, we can consider 162, provided the sellers take the initiative. Also, do not forget that the Bank of Japan can intervene anytime to support the rate.

Alternative scenario: if the price breaks below the support level of 160.26, the downtrend will likely resume.

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News feed for 2024.07.03:

• – Japan Services PMI (m/m) at 03:30 (GMT+3).
   

The XAU/USD currency pair (gold)

Technical indicators of the currency pair:

• Prev Open: 2333
• Prev Close: 2329
• % chg. over the last day: -0.17%

Gold prices gave up early gains on Tuesday and moved lower after the US JOLTS job openings for May unexpectedly increased. That said, Fed Chairman Powell told an economic forum in Portugal that prices are now showing signs of resuming a disinflationary trend, and the Fed may "take its time" in lowering interest rates in the presence of a strong economy and labor market. On the other hand, political uncertainty in France ahead of the second round of parliamentary elections and ongoing tensions in the Middle East are supporting demand for precious metals.

Trading recommendations

• Support levels: 2319, 2295, 2276
• Resistance levels: 2339, 2351, 2370, 2387

From the point of view of technical analysis, the trend on the XAU/USD is still bearish. Gold forms a flat accumulation at 2319-2338 on higher time frames. Buying pressure is intraday, but recent volume spikes show a bearish reaction. The 2339 resistance level could be a problem for the buyers. Under these market conditions, selling can be looked for from the 2339 resistance level but with confirmation. For buying, support at 2319 can be considered. A breakout of 2339 will open the way for the price to 2349.

Alternative scenario: if the price breaks above the resistance level of 2387, the uptrend will likely resume.

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News feed for 2024.07.03:

• – US ADP Nonfarm Employment Change (m/m) at 15:15 (GMT+3);
• – US Initial Jobless Claims (m/m) at 15:30 (GMT+3);
• – US Trade Balance (m/m) at 15:30 (GMT+3);
• – US ISM Services PMI (m/m) at 17:00 (GMT+3);
• – Eurozone ECB President Lagarde Speaks at 17:15 (GMT+3);
• – US FOMC Meeting Minutes at 21:00 (GMT+3).

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