Trading plan for May 28
The US dollar index extended the upside on Wednesday, supported by the USD/JPY strength. Large players are returning into the US currency. There was no important USD releases on the schedule today. On Thursday, we’ll watch the US unemployment claims, while on Friday the market will focus on the second GDP estimate. The last release contains a bearish risk for the USD.
USD/JPY and USD/CAD are the biggest market movers with the greenback pushing higher for a second day in a row. USD/JPY approached the 124.00 mark after having broken through the 122.00-yen technical resistance. Watch the 124.10 resistance – this is the 2007 top.
As it was widely expected, the Bank of Canada left monetary policy unchanged on Thursday, stating the current policy remains appropriate. Canada’s and US GDP releases on Friday could potentially cap the upside. Resistance for USD/CAD lies at 1.2665, while support – at 1.2350.
EUR/USD remained almost unchanged on Wednesday, holding below the 1.0900 mark. There was some speculation that Greek negotiations have become more fruitful recently, but no clear comments was given on the issue. Euro zone’s calendar for tomorrow is rather light. Watch the 1.0670 support for EUR/USD and the 1.1000/50 resistance area.
GBP/USD has spent the day in the red zone, slipping to 1.5300. The pair has recently broken below the bullish trend line. Next support is seen at 1.5100. Economists expect the UK GDP to be revised to the upside tomorrow. The cable could retrace back to 1.5480 on the news.