5 May Forex daily review
Yesterday we did not consider one important aspect, UK on Monday was resting, so the price range was even smaller than expected. Market ignored all the fundamental data from the EU and the U.S.
The index of business activity in the service sector (ISM) in the U.S. in April was 55.2 vs. 53.9 and 53.1 the previous value.
Due to low activity of traders flat continued before the end of day. At 7.00 GMT dollar index was trading near the support at 79.45. At the current pricing model (Friday’s spike) the rebound from 79.40 level is possible, but we would venture on Tuesday to consider DXY index falling to the level of 79.25.
From 7.15 to 8.00 GMT indexes of business activity in the services sector in Spain, Germany, Italy, France and Eurozone will be published. We expect good performance, not lower than the previous values. At 8.30 GMT same index will be published in the UK. These data will set the direction of the dollar in the first half of the day.
For EURUSD, we expect testing the level of 1.3900 and rising to 1.3930. At this level calculated level of resistance and MA line pass. But we know that traders often place protective stops above round values of 20 points. If buyers will hook them with growth, then within a few minutes, EURUSD jumps to 1.3950. A similar pattern is observed for other currency pairs with the dollar.
Yesterday, EURUSD stood at 1.3875. Euro consolidated above the moving average line and today the rebound to 1.3930 is possible. We made two scenarios, since the current pricing model from 1.3890 may follow a rebound. European data will set the direction of the euro for the first half of the day. If there is not a rebound, then we should prepare to test 1.4000 mark.
GBPUSD spent the day under MA line. Market is ready for the growth. According to the latest quotes pound is trading at 1.6890 already. According to the forecast on Tuesday from GBUSD, we expect the rising to the resistance at 1.6950. If service PMI index for the UK does not disappoint, then we do not see any problems in achieving a specified level.
AUDUSD rate on Monday is going sideways. At 4.30 GMT after RBA meeting rate AUDUSD rose to 0.9315 and sharply back to 0.9270. Bulls aim fulfilled, so the outlook is canceled. So we have new options for today.
USDCHF rate is trading at 0.8770. Pair yesterday defended and dollar today can fall to 0.8745. We stopped on this scenario.
Sorry. No data so far.