24May

IForex Market Trading Signals and News – 24 May 2016

MARKET UPDATES :

  • Forex – Yen moves higher after Japan trade data
  • Forex – Dollar little changed, close to 3-week highs
  • Forex- Aussie and kiwi rise vs. greenback amid profit-taking

EUR/USD
The euro slid to the day’s lows on Monday after data showing that growth in the euro area’s private sector slowed to a 16-month low in in May, despite solid growth in Germany and France, as other areas struggled. EUR/USD was down 0.17% at 1.1203, re-approaching last Thursday’s two-month lows of 1.1179. The preliminary reading of the euro zone composite purchasing managers’ index, which measures the combined output of both the manufacturing and service sectors, ticked down to a 16-month low of 52.9 from 53.0 in April.Economists had expected the index to rise to 53.2. The rate of business activity expansion in the dominant service sector was unchanged for a third successive month. But the rate of manufacturing output growth was the second-weakest since February 2015, the report said.

GBP/USD
GBP/USD is currently trading with a slight bullish bias. During the previous trading day on 20th May 2016, the pair traded massively short as previously forecasted and even hit out target support level 1.4480. We expect the current upward rally to be the unfolding of wave (b) and should not break above 1.4543, a beak above this level (1.4543) will lead to an acceleration to the upper side, while a clear rebound from this level will lead to the continuation of wave (c) but should not go below 1.4406. This pair should be traded alongside NZD/USD, AUD/USD and GBP/HKD. These pairs have a strong positive correlation of up to +0.89 and will likely have a similar price action during this week.

RECOMMENDATION :

  • BUY GBP/USD ABOVE 1.4548 TGT 1.4568 1.4598 SL 1.4518
  • SELL GBP/USD BELOW 1.4461 TGT 1.4441 1.4411 SL 1.4491

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