TriumphFX Intraday Forex Analysis – 1 Hour Charts – May 29, 2020

AUDUSD

As suggested in yesterday’s chart analysis, the AUDUSD has been bullish. Price continues to uptrend within a large bullish channel. The moving averages are bullish but are starting to tighten, suggesting that upside momentum could be weakening. The AUDUSD could start ranging between the identified horizontal levels at 0.6575 and 0.6675. Price is down-trending on higher time-frames, signalling that the AUDUSD could attempt a bearish move.

Opportunities to go long may exist around the dynamic support of the moving averages, around the bullish channel support area and around the potential range support at 0.6575. A bullish move could be rejected or reverse around the potential range resistance area at 0.6675.

The Reserve Bank of Australia (RBA) cut rates again in their April 2020 meeting. Rates were cut by a further 0.25%, bringing the official bank rate to 0.25% (a record low). Rates have since stayed the same. The current low rate is needed to help reduce the unemployment rate and stimulate the economy due to COVID-19 recession fears. The RBA will continue to monitor the labour market and inflation. Rates will not be raised until targets are met.

The Federal Reserve has announced a record breaking stimulus package, aimed at US households and employers. The US Federal Open Market Committee (FOMC) has unexpectedly cut rates by 150 points due to heightened concerns regarding the COVID-19 outbreak. The current Fed Funds rate is currently 0.25%, back at post-2008 levels. There is some concern that keeping rates low could cause greater issues in the US’ financial sector. The USD has been acting as a safe haven amid the COVID-19 outbreak. There are some concerns that the COVID-19 pandemic may hit the US hardest, causing a reversal of the recent USD strength.

The Chair of the Federal Reserve will speak at 1500 UTC today.

EURGBP

The EURGBP was finding resistance around the range resistance area (as suggested in yesterday’s chart analysis). Price has since been bullish and has closed above the resistance area. The EURGBP is above the recent consolidation and the moving averages are bullish and widening, all signalling that price may start up-trending.

Long opportunities could exist around the dynamic support of the moving averages and around the previous range resistance area.

The European Central Bank (ECB) continue to keep rates at the record low of 0.00%. Rates have not been cut into negative territory, despite the COVID-19 outbreak. Instead, the ECB has launched an asset buying program. Due to weak trade growth and economic forecasts, rates are likely to stay low for the foreseeable future. The COVID-19 pandemic is just another economic challenge for the Euro zone.

The Bank of England (BOE) has followed other central banks and has cut rates to combat economic challenges caused by the COVID-19 pandemic. The UK interest rate is now set at 0.10% (a historic low). The UK has now left the EU, meaning that Brexit uncertainty should weigh less heavily on the Pound.

There is no major scheduled news today that will directly impact this currency pair.

EURUSD

As suggested in yesterday’s chart analysis, price reversed around the shorter-term moving average and has since swung higher. The EURUSD is up-trending. The moving averages are bullish and steady, signalling that the uptrend could continue. Price has broken above key consolidation resistance on higher time-frames, adding confidence that the upside direction could continue.

Buying opportunities may exist around the moving averages and around the horizontal levels at 1.1025 and 1.0955.

The Chair of the Federal Reserve will speak at 1500 UTC today.

GBPUSD

Price has been bullish (as suggested in yesterday’s chart analysis). The GBPUSD is up-trending within a bullish channel and is currently in a retrace phase. The bullish moving averages are starting to tighten, suggesting that upside momentum is weakening – price may start ranging between 1.2210 and 1.2360.

Opportunities to go long could exist around the dynamic support of the moving averages, around the bullish channel support area and around the horizontal support levels at 1.2210 and 1.2165. A bullish move may be rejected or reverse around the channel resistance area and around the horizontal resistance levels at 1.2360, 1.2370 and 1.2455.

The Chair of the Federal Reserve will speak at 1500 UTC today.

USDCAD

As suggested in yesterday’s chart analysis, USDCAD is ranging and has been moving sideways. Price has been down-trending longer-term but is currently ranging between the recent lows at 1.3735 and the horizontal resistance at 1.3820. The moving averages are bearish and steady, suggesting that the downtrend could continue.

Trading opportunities may exist around the support and resistance areas of the range and if price moves out of the range (break-out trade). A break to the upside could stall or reverse around the longer-term moving average, around the trend resistance area and around the previous horizontal support at 1.3875.

The Bank of Canada (BOC) followed the US by slashing it’s benchmark interest rate. The intent of the rate cut is to help boost the economy during the COVID-19 pandemic. The current rate is now 0.25%. The economy is currently performing well and inflation targets are currently at their potential. If coronavirus fears deescalate, the BOC could increase rates again in the near future.

A Canadian GDP figure will be released at 1230 UTC today. The Chair of the Federal Reserve will speak at 1500 UTC today.

USDCHF

USDCHF reversed around 0.9710 and has formed a bearish move lower (as suggested in yesterday’s chart analysis). Price has moved below the recent consolidation area and price action has formed a bearish channel, all signalling that USDCHF may start down-trending. The moving averages confirm the potential downside – they are bearish and steady.

Opportunities to go short may exist around the dynamic resistance of the moving averages, around the bearish channel resistance area and around the horizontal levels at 0.9640, 0.9650 and 0.9710. Price could continue to find support around the bearish channel support area.

The Swiss National Bank (SNB) continues to keep rates at the all-time low of -0.75%. The Swiss economy continues to be stagnant. The economy was showing signs of positive momentum but COVID-19 is causing the economic to contraction. The Swiss Franc continues to be highly valued as a safe-haven currency. The SNB recently announced that it will continue to intervene with in foreign exchange markets but will likely keep rates unchanged until at least 2021.

The Chair of the Federal Reserve will speak at 1500 UTC today.

USDJPY

As suggested in yesterday’s chart analysis, price has broken to the downside of the range. USDJPY has swung below the recent range support area, suggesting that price may start down-trending. The moving averages are still suggesting market indecision though – they are tight and moving sideways.

Shorting opportunities could exist around the previous support and resistance areas of the range and around the moving averages. A bearish move may stall or reverse around the horizontal support levels at 106.90 and 106.80.

The Bank of Japan (BOJ) continues to keep interest rates at the record low of -0.10%. The Japanese economy is performing well and showing signs of expansion. COVID-19 recession fears could stunt economic growth though.

The Chair of the Federal Reserve will speak at 1500 UTC today.

XAUUSD

Price has been down-trending but recently moved above the bearish channel resistance area, signalling that the downtrend could becoming to an end. The moving averages are tight and moving sideways – confirming the lack of downside momentum.

Trading opportunities may exist around the moving averages, around the previous bearish channel resistance area (as support) and around any of identified horizontal levels at 1696, 1724, 1737, 1751 and 1764.

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