Forex trading plan for November 20
By Kira Iukhtenko
US Dollar retraced lower on Thursday on the back of the “less-hawkish-than-expected” policy meeting minutes. Generally, the document still remains quite hawkish and leaves the door open for a rate hike in December. Beware the Fed's members' comments on Friday and Saturday, though: they could be disappointing for the greenback. This is the only thing to watch in the US calenar till the end of the week.
EUR/USD attempted to rally above 1.0700, but erased gains quickly. Listen to the ECB President Mario Draghi on Friday – he'll deliver a speech at the Euro Finance week in Frankfurt. The ECB minutes on Thursday turned out to be rather dovish, but the market underestimated the tone, in my view: increased deflationary pressures and potential for a policy change were discussed. We target the 1.0500 mark in the near term. Resistance for the pair lies at 1.0800/30.
GBP/USD volatility remains very high. The cable approached the 1&5300 mark on Thursday. A break higher could open the way to 1.5500 once again, but we don't expect this bullish move to be long-lived.
USD/JPY retraced lower from the local high at 123.70. However, a bullish channel with a key support at 122.50 still remains in play. We are ready to buy from these levels. Watch the monthly BOJ report on Friday.
Friday is an intense day for USD/CAD: watch the October retail sales and CPI in Canada. The pair is testing the trend support as we write, but the major level below is 1.3220. We don't expect the decline to be long – the oil market is testing new lows these days.