Trading plan for May 24

This is Forex trading plan for Thursday, May 24.

On Wednesday, the USD index jumped to 94.00. The strengthening of the US currency resulted in big slides in EUR/USD and GBP/USD. Commodity currencies – AUD, NZD, and CAD – depreciated versus the greenback. The only failure of the USD was against the Japanese yen: USD/JPY fell from 110.90 and tested support at 109.60. “FX is back to life,” one of the analysts commented speaking about the recent moves of the market.

Euro area’s PMIs and British inflation figures both disappointed. Now there are serious doubts that the Bank of England will raise interest rates this year. Britain’s future relationship with the European Union remains unclear. The negotiations continue, and there may be a statement on Thursday.

On Thursday as well, the Bank of England’s Governor Mark Carney will deliver a speech. In addition, pay attention to British retail sales at 11:30 MT time (the forecast is positive). The European Central Bank will publish accounts of its latest meeting at 14:30 MT time.

EUR/USD met support at 1.1680 (weekly pivot support and top of the weekly Ichimoku Cloud). A decline below this level will open the way down to 1.1600. If the euro manages to return above 1.1710, its recovery will likely be limited by the downtrend resistance line in the 1.1760 area.

GBP/USD was supported by 1.33. The loss of this level will bring the pound to 1.3250 – the ultimate weekly target. Resistance at 1.34 should be strong.

Finally, if USD/JPY manages to close above the 200-day MA at 110.15 on Wednesday – and even better if it rises above 110.35 – it will try to consolidate between it and 110.85.

Good luck with your Forex trading! Get ready for another exciting trading day!

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