26.05.202612:24 Analisis Forex & Kajian: Level and Target Adjustments for the U.S. Session – May 26th

Given the absence of important fundamental data from the Eurozone and the United Kingdom, the euro and the pound continued trading within sideways ranges. The lack of specific growth or decline drivers allowed prices to remain within established boundaries. All of this suggests that market participants are taking a wait-and-see approach, unwilling to open large positions until a clearer picture of the economic and geopolitical situation emerges.

In the second half of the day, U.S. consumer confidence data and housing price index figures are expected. These macroeconomic indicators typically have a noticeable impact on the U.S. dollar, as they reflect the current state of the American economy and may signal future consumer spending and investment activity. Strong consumer confidence figures and rising housing prices could be interpreted as positive signals, potentially supporting the dollar. However, given the current economic situation, such expectations may be difficult to justify.

Geopolitical tensions remain the key source of uncertainty in global financial markets. Any escalation of the conflict, new diplomatic initiatives, or unexpected statements could trigger sharp movements in the currency market.

If the economic data come out strong, I will rely on the Momentum strategy. If the market shows little reaction to the data, I will continue using the Mean Reversion strategy.

Momentum Strategy (Breakout Trading) for the Second Half of the Day

For EUR/USD

• Buying on a breakout above 1.1659 may lead to euro growth toward 1.1678 and 1.1698;
• Selling on a breakout below 1.1635 may lead to euro weakness toward 1.1609 and 1.1585;

For GBP/USD

• Buying on a breakout above 1.3490 may lead to pound growth toward 1.3529 and 1.3557;
• Selling on a breakout below 1.3460 may lead to pound weakness toward 1.3440 and 1.3390;

For USD/JPY

• Buying on a breakout above 159.25 may lead to dollar growth toward 159.40 and 159.65;
• Selling on a breakout below 158.99 may lead to dollar selling toward 158.55 and 158.25;

Mean Reversion Strategy for the Second Half of the Day

For EUR/USD

• I will look for selling opportunities after a failed breakout above 1.1649 followed by a return below this level;
• I will look for buying opportunities after a failed breakout below 1.1621 followed by a return above this level;

For GBP/USD

• I will look for selling opportunities after a failed breakout above 1.3497 followed by a return below this level;
• I will look for buying opportunities after a failed breakout below 1.3465 followed by a return above this level;

For AUD/USD

• I will look for selling opportunities after a failed breakout above 0.7175 followed by a return below this level;
• I will look for buying opportunities after a failed breakout below 0.7156 followed by a return above this level;

For USD/CAD

• I will look for selling opportunities after a failed breakout above 1.3810 followed by a return below this level;
• I will look for buying opportunities after a failed breakout below 1.3788 followed by a return above this level.