Trading plan for 31.05.2018


There wasn't a lot of a movement during the Asian session today as the month of May is getting close to the end. We got some relevant news and data hitting but despite this moves in the currency market were minor only. Early on a report in US media that President Trump is set to impose metals tariffs on Mexico, Canada and Europe as soon as Friday, the official announcement expected on Thursday. MXN lost ground but CAD and EUR didn't move nearly so much.

On Thursday 31st of May, the event calendar is busy in important data releases. China issued PMI Manufacturing data which was better than expected (51.9 vs. 51.4 expected, 51.4 prior). Australia posted Private Capital Expenditure data which was worse than expected ( 0.4% vs. 0.8%, 0.2% prior). Switzerland posted Gross Domestic Product data which was better than expected (0.6% vs. 0.5%, 0.6% prior), but there are still Retail Sales data to be posted later. The UK will print Net Lending to Individuals data, together with M4 Money Supply data. Eurozone will reveal Consumer Price Index data and Unemployment Rate. Canada will post Gross Domestic Product data and the US will reveal Personal Income, Personal Spending, PCE Income, Challenger Job Cuts, Unemployment Claims, Chicago Purchasing Managers Index and Pending Home Sales data. There are speeches scheduled for today of Vice Chairman of the SNB Governing Board Fritz Zurbrugg, FOMC Member James Bullard, Raphael W. Bostic and Lael Brainard.

EUR/USD analysis for 31/05/2018:

The German inflation data beat the expectations. The harmonized measure of consumer inflation reached the value of 2.2% higher than a year ago (previously 1.4% y/y). The prices were as much as 0.6% higher than in April. The reading is high, but it was expected after good data from several German zones (CPI increased from 0.4 to 0.7% m/m). This kind of inflationary pressure data is very welcomed by the ECB President Mario Draghi.

Let's now take a look at the EUR/USD technical picture at the H1 time frame. The positive data release was behind the recent bounce in the price of Euro above the navy trend line. The bulls have managed to break out above the 1.1661 level and now the market should head towards the next technical resistance at the level of 1.1710 - 1.1726 zone. The immediate support is seen at the level of 1.1644, but the key support is still at the swing bottom at the level of 1.1509.

Trading plan for 31.05.2018