Forex trading plan for Feb. 26
EUR/USD remains mostly flat. The pair’s waiting for fresh catalysts. The ECB’s President Mario Draghi is to speak on Wednesday at 16:30 GMT and may make some comments on monetary policy. On Thursday Germany releases a set of data on unemployment numbers, retail sales figures and Gfk consumer confidence data. The euro area will publish business climate and M3 money supply data. Meanwhile, the ECB releases the targeted LTRO amount at 10:15 GMT. The outlook is neutral/negative. Thepairmaystaystuckinthe1.1440/1.1260 area.
On Tuesday USD/JPY formed a long spike up reaching 119.80. Then cane a selloff which brought the pair down to the 100-meriod MA on the H4 chart. Resistance is at 119.60 and 120.00. Support is in the 118.30 area ahead of 117.30. Uncertainty about the timing of the Fed’s rate hike points at sideways trading. There will be no news from Japan until Friday, so pay attention to the US economic figures, especially inflation data due at 13:30 GMT on Thursday.
GBP/USD is trading above the previous resistance at 1.5480. The Bank of England’s Martin Weale said that rates may need to rise earlier than markets expect. Although Weale has already said this recently, this time his words encouraged the bulls as the Fed’s comments were, on the contrary, very moderate. The UK will release revised Q4 GDP data at 09:30 GMT. According to the initial estimate, the nation’s economic growth has slowed down to 0.5%. Technically pound is trying to break above the daily Ichimoku Cloud, although it seems that it lacks strength. The close above 1.5520 would be a positive signal. Next resistance is at 1.5580 (100-day MA) and 1.5620 (Dec. 31 high). Support is at 1.5400 and 1.5350.
AUD/USD pushed to 0.7900, gaining more than 70 pips on Wednesday. Aussie was supported by upbeat Chinese HSBC PMI that has finally overcome the 50 points waterline. The pair recovered above 38.2% Fibonacci from the late-January decline, confirming a local bottom at 0.7630. Next resistance to watch lies at 0.7960 and 0.8000. Focus on the Australian capital expenditure data on Thursday (-1.7% expected versus 0.2% prior) - they could spoil the bullish picture. All the other market drivers this week will refer to the US dollar.
USD/CAD extends the decline for a second day in a row, testing the 1.2400 support on Wednesday. Next support to watch lies at 1.2350. Canada (alongside with the United States) will release inflation data on Thursday.