EUR/USD Mid-Session Technical Analysis for May 29, 2020

The Euro is trading higher at the mid-session on Friday as traders await a key press conference from President on China in a move that could have a dramatic effect on investor sentiment.

On Friday, the greenback extended its slide against the surging Euro, hurt by month-end flows and as the common currency continued to enjoy a boost from the European Union’s recently announced plan to prop up the bloc’s coronavirus-hit economies with a 750 billion-Euro ($828 billion) recovery fund.

At 18:17 GMT, the EUR/USD is trading at 1.1093, up 0.0014 or -0.12%. This is down from an intraday high of $1.1145.

An early session gain by the Euro was driven by optimism generated by the European Commission’s stimulus plan announced earlier this week, as well as investors’ improved appetite for risk-taking as global economies gradually move to reopen after coronavirus-linked shutdowns, analysts said.

However, prices fell after the U.S. Dollar found support as traders awaited U.S. President Donald Trump’s response to China’s tightening control over Hong Kong, which could worsen tensions between the two powers over the financial hub.

Daily EUR/USD

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend continued earlier today when buyers took out yesterday’s high. A trade through the main top at 1.1147 will reaffirm the uptrend. The main trend will change to down on a trade through the last main bottom at 1.0871.

The main range is 1.1496 to 1.0636. The EUR/USD is currently testing its retracement zone at 1.1066 to 1.1167. This zone is controlling the longer-term direction of the Forex pair.

The short-term range is 1.0636 to 1.1147. Its retracement zone at 1.0987 to 1.0937 is the nearest support zone.

Daily Swing Chart Technical Forecast

Based on the early price action and current price at 1.1093, the direction of the EUR/USD the rest of the session on Friday is likely to be determined by trader reaction to the main 50% level at 1.1066.

Bullish Scenario

A sustained move over 1.1066 will indicate the presence of buyers. If this creates enough upside momentum then we could see a surge into the main top at 1.1147, followed by the main Fibonacci level at 1.1167.

Bearish Scenario

A sustained move under 1.1066 will signal the presence of sellers. This is a potential trigger point for an acceleration to the downside with the short-term retracement zone at 1.0987 to 1.0937 the next likely downside target zone.

For a look at all of today’s economic events, check out our economic calendar.

USD/CAD Daily Forecast – Canadian Dollar Loses Ground Ahead Of The Weekend

USD/CAD Video 29.05.20.

U.S. Dollar Gains Ground As Canada Reports Grim GDP Numbers

USD/CAD tested the support level at 1.3730 but reversed course and climbed back to 1.3800 as the U.S. Dollar Index rebounded from the 98 level while Canada provided a disappointing GDP Growth Rate report.

Canada’s GDP Growth Rate in the first quarter was -2.1% quarter-on-quarter. GDP Growth Rate Annualized was -8.2% in the first quarter as the Canadian economy received a double hit from coronavirus and low energy prices. Canada expects that GDP growth declined by 11% in April.

The U.S. also reported grim economic data as Personal Spending was down by 13.6% as virus containment measures put significant pressure on consumer activity.

The U.S. Dollar Index has recently breached the low end of the previous 99 – 101 range and tested the 98 level but started to rebound, providing additional boost to USD/CAD.

The equity markets are worried about an additional increase in U.S. – China tensions but the U.S. dollar has not received too much support despite its role of a safe haven asset.

Technical Analysis

usd cad may 29 2020

USD/CAD has once again tested the nearest support level at 1.3730 but this attempt was unsuccessful. Instead of getting below 1.3730, USD/CAD gained significant near-term upside momentum and headed towards 1.3800.

Currently, USD/CAD is trading in the range between the support level at 1.3730 and the resistance level at 1.3850. The 20 EMA has recently crossed the 50 EMA to the downside, suggesting the increase in downside momentum, but USD/CAD will have to stay below 1.3850 to have material chances for additional downside.

In case USD/CAD manages to settle below 1.3730, it will head towards the next support level at 1.3650.

On the upside, USD/CAD will have to deal with the major resistance at 1.3850 which has previously served as the support level in a two-month trading range between 1.3850 and 1.4250.

In case USD/CAD gets above 1.3850, it will gain additional upside momentum and head towards the 20 EMA level at 1.3935. The 50 EMA is located close to the 20 EMA so this resistance level may be very significant.

If USD/CAD settles above both the 20 EMA and the 50 EMA, the next resistance will likely be seen closer to 1.4000.

For a look at all of today’s economic events, check out our economic calendar.

 

USD/JPY Weekly Price Forecast – US Dollar Stock in Tight Range Against Japanese Yen

The US dollar went back and forth during the course of the week, hanging around the ¥107 level yet again. This seems to be a bit of a magnet for price, as it is in the middle of the larger consolidation area between the ¥105 level on the bottom and the ¥109 level on the top. At this point, it looks as if the market is trying to pick the next direction, so you are better off simply waiting on some type of impulsive candlestick to get involved. Ultimately, I think that longer-term traders will probably continue to avoid this market, and quite frankly I think they probably should.

USD/JPY Video 01.06.20

When we do make that impulsive candlestick, then you can follow the market for a couple of hundred tics. Ultimately though, the market looks highly likely to see some type of decision eventually. At this point, this is a market that is probably easier to trade on short-term charts, as an investment would be a bit difficult.

Ultimately though, I do think that we will get that signal as to where we are going for the next 500 points, but right now we are not anywhere near making that decision so I would be cautious about putting too much money into this market in the meantime. If you are patient enough, you should get some type of trend to follow, but right now we clearly do not have land when it comes to these two currencies, which both are thought of as “safety currencies”, so it should not be a huge surprise.

For a look at all of today’s economic events, check out our economic calendar.

GBP/USD Weekly Price Forecast – British Pound Has Strong Week

The British pound has rallied significantly during the week, reaching towards the 1.2350 level. This is an area that shows up a lot on shorter-term charts, as both support and resistance. If we can continue to grind higher from here, and we very well could, then the 1.25 level becomes in focus. That area I think would continue to cause significant resistance, so pay attention to that level if we get there, as it will certainly be a major fight.

GBP/USD Video 01.06.20

If we were to break above the 50 week EMA, which is just above there, then the British pound could very well go to the 1.30 level. Ultimately, this is a market that I think has to deal with the Brexit headlines next week, as negotiations start back up. It already has been a lot of chirping between London and the continent, as the chief UK negotiator recently stated that the “European Union needs to come a long way to have an acceptable agreement.” If that is going to be the case, I cannot imagine that good comes out of this.

Were in a downtrend anyways, so that should only help the downward momentum. However, it looks to me like the market is likely to continue to see a lot of noise, so be cautious about your position size, and be patient. You need to see some type of exhaustive candle to start shorting. If we break above and close above the 50 week EMA on the daily chart, then it is time to start buying. I think it is that simple.

For a look at all of today’s economic events, check out our economic calendar.

GBP/JPY Weekly Price Forecast – British Pound Resilient Against Yen

The British pound rallied during the week, breaking above the ¥132 level in a sign of strength. However, there is a lot of noise between here and the ¥135 level, so I think it is only a matter of time before we see some type of pushback. Keep in mind that the market has faced a lot of support underneath in order to bounce yet again. However, the most recent bounce before the one we are in now is lower, so that does suggest that perhaps there is still a lot of shorting going on out there.

GBP/JPY Video 01.06.20

The market has been rather tight as of late, so at this point I think we are waiting for a large impulsive candlestick in order to take some type of trade on. At this point, I believe that simply waiting to see where the risk in the world is will tell you what this pair should do. Quite frankly, I believe that the Japanese yen is considered to be “safer” than the British pound because not only do we have global issues, but we also have to worry about the Brexit which is not going anywhere, and we do in fact have to get through a slew of headlines that could cause major issues in that scenario.

With that in mind, I think it is more than likely going to be a scenario where we get a lot of choppy volatility, but I think the road higher is going to be difficult to achieve. A break above the ¥135 level could get this market moving to the upside quite quickly though.

For a look at all of today’s economic events, check out our economic calendar.

EUR/USD Weekly Price Forecast – The Euro Explodes to The Upside

The Euro market rallied against the US dollar on the majority of the week, reaching towards the 1.1150 level before pulling back a bit early on Friday. Quite frankly, we are facing a significant amount of resistance just above and this is a completely messy chart at the moment. Yes, it is an extraordinarily strong and bullish candlestick that we have seen this recently, where the Euro exploded straight up in the air and then got slammed right back down.

EUR/USD Video 01.06.20

A lot of what we are seeing is a reaction “unified bonds” that the European Union is selling. In other words, Germany is backstopping Greece. With that, it should lead to a stronger currency, but at the end of the day the economic figures do not pan out for a stronger Euro. It is because of this that I think we will continue to see a lot of volatility, and therefore do not trust this rally quite yet. Beyond that, it is important to think of this as an indicator, showing you Euro strength or weakness in general.

I will use this chart tell me what to trade as far as direction is concerned in any EUR pair, but not necessarily this one. As I stated in my daily analysis, this sets up for a great indicator with the EUR/CAD pair, especially if crude oil continues to fall. However, I will keep you up-to-date as to what I see but right now I think we are to see a widening volatility regiment in this market, and that of course makes for nothing but headaches.

For a look at all of today’s economic events, check out our economic calendar.

AUD/USD Weekly Price Forecast – Australian Dollar Running Into 50 Week EMA

The Australian dollar has rallied significantly during the week, reaching towards the 50 week EMA which sits at the very top of the candlestick. If we pull back from here, it does make quite a bit of sense that the market could drift a few handles lower, because we are right where the massive break in support occurred. This is an area that at least from a technical analysis standpoint should be quite interesting for sellers, and therefore I think it will attract quite a bit of attention. Furthermore, with even more telling is that Donald Trump is coming with an announcement involving China heading into the weekend, and that more than likely will not do many favors for the Aussie dollar as well.

AUD/USD Video 01.06.20

That being said, if we were to break above the 0.67 level on a daily close, then I think we start to think about the market reaching towards the 0.70 level. Breaking above there would change the entire trend, something that I do not anticipate seeing. Yes, this has been an absolutely brutal bounce, but I think that in the end it is just that: a bounce. However, I am willing to follow the market and admit that I am wrong if we do break out to the upside.

Remember that the Australian dollar is overly sensitive to the Chinese situation, which of course could get overly complicated relatively soon. With that being the case, I think that the Australian dollar will probably take it on the chin. For what it is worth, the Aussie stock market looks absolutely horrible.

For a look at all of today’s economic events, check out our economic calendar.

USD/JPY Price Forecast – US Dollar Pulls Back Toward Support Against Yen

The US dollar has broken down significantly against the Japanese yen on Friday, dropping about 80 pips by the time New York started. While that is not a huge move, it is relatively big for the last couple of weeks. The market stopped just above the ¥107 level and hung about there, so I think at this point it is likely that the area could bring some buyers in this vicinity, but if we were to break down below the ¥107 level, it opens up the possibility of a move down to the ¥106 level where we had seen a bit of a bounce.

USD/JPY Video 01.06.20

To the upside, the 50 day EMA continues to hang above the ¥107.75. A break above there opens up the possibility of a move towards the 200 day EMA, which at this point I think that the sellers would be an influence as well. Ultimately, this is a pair that continues to chop around, and it should consider that both of these are considered to be “safety currencies.”

Ultimately, that causes a lot of noise here so looking at this chart it is obvious that the volatility is going to continue to be a major influence, so it is difficult to trade this market for a bigger move until we get some type of clarity. I do not have clarity at this point, so it is short-term back-and-forth, probably in increments of 20 or even 30 pips. I would not put huge positions on here either.

For a look at all of today’s economic events, check out our economic calendar.

EUR/USD Price Forecast – Euro Continues to Press Higher

The Euro exploded to the upside it over the last 48 hours, as the market has reached towards the 1.1150 level. This is an area where we have seen selling previously, but a lot of this is due to the European Union offering bonds that are backed by the entirety of the EU instead of the single countries. This should be stronger, and therefore people like the idea of the future of the Euro much more than they did just a few weeks ago.

EUR/USD Video 01.06.20

It is a remarkable move, but when you look at the last couple of months, we have seen massive moves in one direction or another. In other words, even though it is obviously bullish over the last several days, it is still difficult to get long of the Euro at this point, because we have seen this movie before, and have seen it recently. With that in mind I am a bit skeptical, and quite frankly will trade the Euro against other currencies.

I will use this currency pair as a bit of an indicator as to what I am doing with the Euro gets other currency such as the Canadian dollar, the Japanese yen, British pound, and so on. Obviously, the Euro is very strong in the short term, so buying the Euro gets is other currencies makes quite a bit more sense due to the fact that there is a lot of concern about negative headlines, so with that in the back of her mind, it is a bit difficult to be short the US dollar when you can short other currency such as the Canadian dollar that would take more of a hit in those scenarios.

For a look at all of today’s economic events, check out our economic calendar.

GBP/USD Price Forecast – British Pound Tests 50 Day EMA

The British pound initially pulled back a bit during the trading session on Friday before turning around and smashing into the 50 day EMA. As we got there, the market did pull back a bit, and it should be noted that we continue to see a lot of noisy behavior overall. If that is going to continue to be the case, then I think it is only a matter of time before we see massive selling pressure. However, if we break above the 50 day EMA, then it is likely that we will then go looking towards the 1.25 level. At that point, I would anticipate seeing even more resistance.

GBP/USD Video 01.06.20

The market will continue to be very noisy, as we have a whole plethora of problems in the UK that will continue to weigh upon Sterling. The Brexit is still a major issue, and we have talks going on this coming week that will of course cause a bit of volatility as well. Ultimately, I do think that we pull back, and start going lower but it is probably going to take some type of headline to make that happen. The question is not so much in my mind whether or not we pullback, but if we do it here, or if we do it at the 1.25 level. With the leverage in Forex, timing is crucial, so if you do decide to short in this general vicinity I would do so with a small position. You can always add to a trade that is working out in your favor.

For a look at all of today’s economic events, check out our economic calendar.

AUD/USD Price Forecast – Australian Dollar Trying to Break Out

The Australian dollar has pulled back a bit to kick off the trading session on Friday, but then bounced as the 200 day EMA came into play. At this point, we are getting remarkably close to the 0.67 handle, an area that if we can break above, the market is likely to go much higher. At this point, it certainly looks as if the Aussie dollar is trying to take out the resistance and start a new trend higher, but one has to wonder what is going to happen between the United States and China? Clearly that is not going to be a good thing and with Donald Trump announcing a press conference late on Friday, we could see a sudden reversal. That being said, if the day closes above the 0.67 level, then it is likely that we continue to go much higher.

AUD/USD Video 01.06.20

This is a market that looks likely to have to make some type of significant decision, but at this juncture it is difficult to imagine that it is going to be easy. You need to be overly cautious when trading this pair, because once we make a move it is probably going to be rather drastic. Ultimately, I believe that the market will probably see some type of resolution, but clearly the market looks as if it is trying to break out to the upside. If this fails, it is right at where we had seen a major breakdown several months ago. In other words, it is decision time so therefore let the market decide and then simply follow.

For a look at all of today’s economic events, check out our economic calendar.

GBP/JPY Price Forecast – British Pound Continues Consolidation Against Yen

The British pound has initially pulled back during the trading session on Friday but has seen buying come in and push the market towards the top of the short-term range again. At this point though, the market still sees a lot of noise in general, so I do think that we are likely to see choppy trading back and forth. The 50 day EMA is sitting just above, and therefore it should be paid attention to. If the market were to break above there, the likelihood of a move towards ¥135 increases drastically. On the other hand, if the market were to break down below the ¥132 level again, one would have to think that the overall trend would come back into play, suggesting that we are going to go lower.

GBP/JPY Video 01.06.20

Having said that, there seems to be a lot of hope out there that as economies around the world open up, there should be an opportunity to pick up profits in general and therefore it should be more “risk on” that it has been. Perhaps the idea is that we had oversold everything to do with risk appetite, and therefore it makes sense that this pair pops. Ultimately, the market is at a major decision area, and therefore we should see some type of bigger move coming, so next week will be crucial. The 50 day EMA of course is an area that should cause some kind of barrier, so breaking above there will attract a lot of momentum traders.

For a look at all of today’s economic events, check out our economic calendar.

GBP/USD Remains Well-Supported on a Broadly Weaker Dollar

A strong appetite for risk has weighed on the dollar and all of the major currencies have gained against the greenback this week as a result. The British pound, however, has gained less than most of its counterparts as concerns over Brexit and further monetary policy easing in the UK has weighed.

The session ahead is expected to be a volatile one. Here are some of the scheduled risk events:

  • US President Trump will hold a press conference regarding China. The announcement was made late yesterday which has triggered some risk aversion
  • Fed Chair Powell will speak later today. It will be his last chance to speak before the mandatory blackout period ahead of the June 11 meeting.
  • The US will release its latest PCE index figures.

In addition to the scheduled risk events, trade adjustments are typically made at month-end which stands to further impact the markets today.

Technical Analysis

GBPUSD 4-Hour Chart

GBP/USD has been underpinned by a weaker dollar as the US dollar index (DXY) has fallen to lows not seen around the middle of March in early trading today.

While the pound to dollar exchange rate has benefited from this weakness, the pair is seen struggling to gain following a bullish break above a horizontal level at 1.2266.

This level is considered important as it acted as support in late April and early May and then proved to be a big hurdle last week.

So far, sellers have stepped in near 1.2350 with the 200 moving average on a 4-hour chart near there to create an obstacle for bulls.

A break above it shows further resistance at 1.2400 followed by 1.2476.

The pair was supported by a rising trend channel yesterday and once again shows upward momentum, but traders looking to take advantage of a weaker dollar may be better off looking at other currency pairs.

Key support for the session ahead remains at 1.2266 as the lower bound of the trend channel on a 4-hour chart is converging to the level. While above it, the next target for GBP/USD falls at 1.2398.

Bottom Line

  • GBP/USD has fallen into a range but holds above key support to maintain a bullish outlook.
  • The session ahead is expected to be volatile with several risk events and potential month-end trade adjustments that stand to move the markets.

For a look at all of today’s economic events, check out our economic calendar.

Brent Oil and Gold With Interesting Setups

In today’s analysis, we will focus on commodities: Gold and Oil. In the previous months, Gold was climbing has been mostly moving higher and oil has been declining. Despite the most recent rise in the price of Brent and a small decline in the price of gold, we think that we are about to see a comeback to the dominant trend. In both cases, gold has a nice bullish signal and oil is drawing rather bearish pattern.

First, lest start with Brent Oil, where its price has doubled since the end of April. In the last two weeks, the upswing stopped and the price is creating a head and shoulders pattern. The price is creating the right shoulder of the pattern. The main up trendline was already broken but the neckline is still intact. In this case, the price breaking the neckline can be a nice selling opportunity.

The second instrument is Gold, where the price is currently breaking the upper line of the flag formation. The flag was a correction in the bullish trend, so it promotes another wave up. The real, legitimate buy signal will be triggered, when the price will break the horizontal resistance at 1735 USD/oz.

The last instrument is not a commodity but the USDJPY pair which is definitely worth mentioning. This Friday is crucial for this pair as the price has managed to escape from the recent sideways trend. Sellers broke two up trendlines and the lower line of the rectangle pattern. Currently, we are testing this last support as a resistance. The test so far is positive for sellers, which may indicate a willingness for a further slide. Sentiment here is negative.

For a look at all of today’s economic events, check out our economic calendar.

EUR/USD Daily Forecast: Euro Continues Highers While Dollar Index Falls to 9-Week Low

EUR/USD is attempting to post a fifth straight day of gains and was last seen approaching highs not seen since the end of March as the dollar remains under pressure.

The currency pair is lifted by prospects of further easing in Europe while the dollar is falling on the back of strength in the stock markets.

It’s expected to be a busy day ahead with several risk events that stand to move the markets.

Trump announced late yesterday that he will be giving a press conference related to China on Friday. Equity markets and some of the risky currencies, such as the Australian and New Zealand dollars, pared some gains after the announcement yesterday.

Fed Chair Powell is scheduled to speak in early North American trading. It will be his last chance to communicate the Fed’s stance ahead of the typical blackout period ahead of the Fed meeting to take place on June 11.

Further, the latest US PCE price index data will be released in the US session which also stands to move the markets. Analysts expect the core component of the index to show a decline of 0.3% last month following a drop of 0.1% in the prior reading.

Lastly, the markets are susceptible to month-end adjustment which also stands to impact volatility today.

Earlier today, Europe reported consumer prices to have risen 0.1% since last year which was in line with expectations but down from a rise of 0.4% in the last reading.

Technical Analysis

EURUSD Daily Chart

While EUR/USD shows strong upward momentum and a clear near-term bullish trend, the risk events in the session ahead stand to cause volatile fluctuations.

The pair cleared above it’s 200-day moving average yesterday which sets a bullish tone and suggests dips should continue to be bought.

Resistance for the session ahead is seen at 1.1183 which is just above the late March high.

EUR/USD closed yesterday at 1.1075 resistance but is seen trading firmly above it in the early day. The level is seen as the support for the session ahead.

The single currency is the strongest among the majors in the early day and for the week thus far.

Bottom Line

  • Several risk events in the session ahead suggest it will be a volatile session for EUR/USD and the markets in general.
  • The pair is approaching resistance at 1.1183 which may prove to be a major hurdle for bulls.

For a look at all of today’s economic events, check out our economic calendar.

GBP/USD Daily Forecast – Test Of Key Resistance At 1.2350

GBP/USD Video 29.05.20.

Increasing U.S. – China Tensions Do Not Help The U.S. Dollar

GBP/USD is testing the resistance level at 1.2350 as the U.S. dollar remains under pressure against a broad basket of currencies despite the increase in U.S. – China tensions.

U.S. President Donald Trump is set to hold a press conference on China on Friday. The key intrigue is whether U.S. will choose some mild sanctions like travel bans for certain Chinese officials or impose new tariffs on China.

Interestingly, the deterioration of U.S. – China relations and the prospect of a new phase of the trade war between the two biggest economies do not help the U.S. dollar which has served as a safe haven asset of last resort during the coronavirus crisis.

The U.S. Dollar Index, which measures the strength of the U.S. dollar against a broad basket of currencies, has broken out of the 99 – 101 range and is trending down, which is bullish for GBP/USD. Currently, the U.S. Dollar Index has settled closer to 98.

It’s too early to say whether the safe haven status is shifting from the U.S. dollar to gold, which is gaining ground today. If that’s the case, GBP/USD will get more support in the upcoming trading sessions.

Technical Analysis

gbp usd may 29 2020

The recent sell-off, caused by fears about upcoming Brexit problems, proved to be temporary, and GBP/USD quickly returned above 1.2250 and headed towards the test of the nearest resistance level at 1.2350.

This level has already been tested several times, and each time GBP/USD met significant resistance. The 50 EMA is located in the nearby and serves as an additional obstacle on the way up.

In case GBP/USD manages to settle above 1.2350, it will gain additional upside momentum and head towards the next resistance level at 1.2450.

On the support side, the nearest support for GBP/USD is located at the 20 EMA at 1.2280, followed by the major support level at 1.2250. Most likely, the whole area between 1.2250 and 1.2280 will serve as one significant support level for GPB/USD.

If GBP/USD settles below this level, it will gain downside momentum and head towards the test of the next support area between 1.2170 and 1.2200.

For a look at all of today’s economic events, check out our economic calendar.

 

USD/CAD Daily Forecast – Flat Despite Broad Weakness Of U.S. Dollar

USD/CAD Video 28.05.20.

Canadian Dollar Fails To Gain More Ground

USD/CAD stays below the resistance level at 1.3800 as the U.S. dollar is losing ground against a broad basket of currencies while oil is steady despite a surprising increase in oil inventories.

Today, the U.S. has provided a number of economic reports. In general, the economic picture continues to look grim.

Initial Jobless Claims report showed that 2.1 million Americans filed for unemployment benefits in a week. Durable Goods Orders declined by 17.2% month-over-month in April. First-quarter GDP Growth Rate was -5%.

However, some hope was provided by Continuing Jobless Claims which declined from 25 million to 21 million.

The new portion of economic data from the U.S. and the continued increase in U.S. – China tensions did not spoil the mood of global markets today. The demand for safe haven assets decreased, and the U.S. dollar found itself under material pressure.

The U.S. Dollar Index, which measures the strength of the U.S. dollar against a broad basket of currencies, has declined closer to 98.5. The U.S. Dollar Index has spent two months between 99 and 101, and a move out of this range could lead to increased downside momentum for the U.S. dollar.

Technical Analysis

usd cad may 28 2020

USD/CAD failed to continue the downside move despite the fact that the U.S. dollar is under significant pressure against a broad basket of currencies. The likely reason for this is that the previous downside move was too fast and USD/CAD needs a pause before it will be able to make the next move.

The nearest support level for USD/CAD is located at 1.3730. This level has already been tested several times and has proved its strength. In case USD/CAD manages to get below this level, it will likely gain additional downside momentum and head towards the next support level at 1.3650.

The 20 EMA has recently crossed the 50 EMA to the downside, suggesting the continuation of the downside trend.

On the upside, a minor resistance near 1.3800 was formed. If USD/CAD gets above this level, it will head towards the test of the major resistance level at 1.3850. I’d expect that USD/CAD will attract a lot of interest if it gets back to 1.3850 as this level served as the low end of the two-month trading range between 1.3850 and 1.4250.

For a look at all of today’s economic events, check out our economic calendar.

USD/JPY Price Forecast – US Dollar Continues to Struggle Against Japanese Yen

The US dollar has gone back and forth during the trading session on Thursday, reaching towards the ¥108 level yet again. That is an area that has been quite difficult for the market to get out of, as the ¥107 level has been massive support. Ultimately, this is a market that continues to be difficult to deal with for anything more than a short-term trade. Ultimately, the market will make a decision, but right now it is only deciding to go sideways. This makes quite a bit of sense that the market would do this, simply because the US dollar and the Japanese yen are both considered to be safety currencies, so that will continue to be a major issue to deal with.

USD/JPY Video 29.05.20

Looking at this chart, we are also right at the 50 day EMA, so that of course causes a lot of attention to be paid to the market there as well. Ultimately, this is a market that I think is eventually going to make an impulsive move, and when it happens it will be obvious. Those obvious impulsive candlestick should give us a heads up as to what to do next, so I will be watching that. Ultimately, this is a market that I think will eventually offer great returns, but we are nowhere near that right now. Short-term I believe that this is a market that simply offers a lot of back-and-forth trading which is perfect if you are a short timeframe type of person. Otherwise, you will probably have to wait.

For a look at all of today’s economic events, check out our economic calendar.

EUR/USD Mid-Session Technical Analysis for May 28, 2020

The Euro hit a fresh eight-week high on Thursday, bolstered by a 750 billion Euro European Union plan to prop up the bloc’s virus-hit economies. But it is facing headwinds as doubts about delivery the scheme crept in.

“It is probably too early to say that the rally in the Euro is the start of a major re-rating of European risk,” said Chris Turner, global head of markets at ING, in a note.

“The path to getting (the) recovery fund carved out of the long-term EU budget will be a bumpy one…thus it is hard to make the case that (the) Euro moves higher in a straight line from current levels.”

At 13:56 GMT, the EUR/USD is trading 1.1038, up 0.0030 or +0.27%.

In other news, first-time claims for U.S. unemployment benefits totaled 2.1 million last week, the lowest total since the coronavirus crisis began though indicative that a historically high number of Americans remain separated from their jobs. Economists were looking for a 2.05 million increase.

Daily EUR/USD

Daily Swing Chart Technical Analysis

The main trend is up according to the daily swing chart. The uptrend was reaffirmed on Thursday when buyers out the May 1 top at 1.1018. The main trend will change to down on a move through the last swing bottom at 1.0871.

The main range is 1.1496 to 1.0636. Its retracement zone at 1.1066 to 1.1167 is the next upside target. Sellers could show up on a test of this zone.

The short-term retracement zone at 1.0987 to 1.0937 is the first support. The intermediate retracement zone at 1.0892 to 1.0831 is the second support.

Daily Swing Chart Technical Forecast

Based on the early price action and the current price at 1.1026, the direction of the EUR/USD the rest of the session on Thursday is likely to be determined by trader reaction to the short-term Fibonacci level at 1.0987.

Bullish Scenario

A sustained move over 1.0987 will indicate the presence of buyers. Now that the main tops at 1.1008 and 1.1018 are out of the way, the Forex pair has a clear shot at the 50% level at 1.1066. This is a potential trigger point for an acceleration into the main top at 1.1147 and the main Fibonacci level at 1.1167.

Bearish Scenario

The inability to overtake 1.1066 will be the first sign of selling pressure, but the bullish tone will be tarnished if 1.0987 fails as support. This could lead to a pullback into at least 1.0937.

For a look at all of today’s economic events, check out our economic calendar.

GBP/USD Price Forecast – British Pound Continues to Grind

The British pound has initially fallen during the trading session on Thursday but then rallied after the jobless numbers came out in the United States. Quite frankly, the US stock market seems to be rallying at any chance it can, and that tends to work in the favor of some of the riskier currencies such as the British pound. However, the UK has a whole slew of problems out there just waiting to happen so therefore we have to be overly cautious about how we play this market. That being said, I do believe that the 50 day EMA above will cause quite a bit of resistance, and the 1.2350 level is likely to be a difficult barrier to break above.

GBP/USD Video 29.05.20

To the downside, if we were to break down below the 1.21 handle, then this market could go down to the 1.20 level rather quickly. After that, then the British pound goes looking towards the 1.1750 level. There is a significant amount of volatility coming our way, so that being the case it is likely that we will see a lot of back and forth, and quite frankly an explosive move could be coming. In the meantime, I expect to see a lot of choppy behavior, so keep your position size reasonably small. Risk continues to be for sudden whipsaw trading due to the rush of headlines that can come at any moment. Quite frankly, you need to be cautious and protect your trading capital more than anything else at this juncture.

For a look at all of today’s economic events, check out our economic calendar.