EURUSD: Time to Reverse? Top 5 assets to follow on May 2-6
This week, the majors will be affected by the interest rate decision by the Federal Reserve, NFP, the BOE Meeting, and more events.
Weekly Forex Outlook: April 23-27
Let’s have a look at the main events which took place in the Forex market during the recent days and discuss trade ideas for the new week.
US dollar strengthened in all major pairs amid improving appetite for riskier assets and upbeat US economic data.
EUR/USD was limited by resistance at 1.24. Have a look at the chart: here is the resistance line that connects February and March highs. It means that the euro’s getting closed to support at 1.2250 and 1.2215. A break below this level may mean the reversal of a longer-term uptrend and a bigger selloff.
GBP/USD was rejected from levels near 1.44 and fell sharply down. British retail sells fell and the Bank of England Governor Mark Carney unexpectedly damped expectations for an interest-rate hike in May. A weekly close below 1.4088 will create a bearish engulfing pattern on the weekly chart. The fact that the pound once again failed to settle above the 200-week MA makes the negative signal stronger. So, GBP/USD may fall as low as to 1.3850 (100-day MA).
If the geopolitical situation remains favorable, USD/JPY may stretch up to 108.50. Here we find a Fibonacci level of the 2017-2018 decline. At the same time, there bullish potential for the Japanese yen in other currency pairs. Pay special attention to GBP/JPY and NZD/JPY – these pairs have high chances of falling.
Economic calendar
Let’s now have a look at the events that may shake the Forex market in the coming days.
One of the most important events will be the meeting of the European Central Bank on Thursday: the ECB might shed some clues on removing policy stimulus. Market participants expect this from the central bank and it the ECB disappoints we will see a huge selloff of the euro.
Other opportunities to trade on news include European PMIs on Monday, Australian CPI and US consumer confidence on Tuesday. On Friday, there will be a meeting of the Bank of Japan, while Britain and America will release the first readings of Q1 GDP.
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