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Long-term review

Minor operational scale (Daily)

What threatens the last week of May and the beginning of summer with the main currency instruments? Development options for the movement #USDX vs EUR/USD, GBP/USD, and USD/JPY (Daily) on May 26, 2020.

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US dollar index

From May 26, 2020, the movement of the dollar index (#USDX) will continue to be determined by working out the boundaries of the 1/2 Median Line channel (101.20-100.20-99.25) of the Minor operational scale - details of movement within this channel are shown on the animated chart.

A breakout of the lower border of the channel 1/2 Median Line Minor - support level of 99.25 - will confirm the further development of the movement of the dollar index in the equilibrium zone (99.50-98.50-97.50) of the Minor operational scale fork with the prospect of achieving the ultimate Shiff Line Minor (96.30).

The breakdown of the upper border of the channel 1/2 Median Line of the Minor operational scale fork - resistance 101.20 - will be important to the continuation of the upward movement #USDX to the starting line SSL (102.60) of the Minor operational scale fork and a maximum of 102.99.

The layout of the #USDX movement options from May 26, 2020 is shown on the animated chart.

Exchange Rates 22.05.2020 analysis

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Euro vs US dollar

From May 26, 2020, the single European currency EUR/USD will continue to develop the movement depending on the development and direction of breakdown of the channel boundaries 1/2 Median Line (1.0910-1.0885-1.0845) of the Minuette operational scale forks - details are shown in the animated chart.

If the upper limit of the 1/2 Median Line channel is broken, the Minute - resistance level of 1.0910 - the further development of the movement of the single European currency will occur within the borders of the 1/2 Median Line channel (1.0865-1.0960-1.1050) and equilibrium zones (1.1050-1.1150-1.1256) of the Minor operational scale fork.

If the support level of 1.0845 breaks at the lower border of the channel 1/2 Median Line Minute, the downward movement of EUR/USD can be continued to the borders of the equilibrium zone (1.0800-1.0730 - 1.0675) of the Minuette operational scale fork.

Options for EUR/USD movement from May 26, 2020, depending on the processing of the channel 1/2ML Minute are shown on the animated chart.

Exchange Rates 22.05.2020 analysis

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Great Britain pound vs US dollar

The development of the movement of Her Majesty's currency GBP/USD from May 26, 2020 will be due to the development and direction of the breakdown of the boundaries of the 1/2 Median Line channel (1.2360-1.2160-1.1930) of the Minor operational scale fork - marking of movement within this equilibrium zone is shown in the animated chart.

When the upper border of the channel is broken 1/2 Median Line Minor - resistance level 1.2360 - the movement of Her Majesty's currency can be continued to the borders of the equilibrium zone (1.2570-1.2870-1.3170) of the Minor operational scale fork.

If there will be a breakdown of the lower border of the channel 1/2 Median Line in the Minor operational scale - support level 1.1930 - then the downward movement of GBP/USD can be continued to the borders of the channel 1/2 Median Line (1.1700-1.1500-1.1270) of the Minuette operational scale fork.

From May 26, 2020, we look at the GBP/USD movement options on the animated chart.

Exchange Rates 22.05.2020 analysis

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US dollar vs Japanese yen

Range development and breakdown direction:

  • resistance level of 108.20 - the upper limit of the 1/2 medium Line channel of the Minor operational scale forks;
  • support level 107.30 - the control line LTL of the Minuette operational scale forks;
  • and it will determine the development of the movement of the currency of the "Land of the Rising Sun" USD/JPY from May 26, 2020.

Breakdown of the LTL control line of the Minuette operational scale fork -support level 107.30 - an option to continue the development of the downward movement of the currency of the "Land of the Rising Sun" to the goals:

  • local minimum 106.00;
  • warning line LWL38.2 (105.50) of the Minor operational scale pitchfork;
  • control line LTL Minor (104.40).

If the resistance level of 108.20 is broken, the USD/JPY movement will continue in the 1/2 Median Line channel (108.20-109.35-110.55) of the Minor operational scale fork with the prospect of reaching the boundaries of the 1/2 Median Line channel (111.30-112.70-114.10) of the Minuette operational scale fork.

The markup of the USD/JPY movement options from May 26, 2020 is shown on the animated chart.

Exchange Rates 22.05.2020 analysis

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The review is compiled without taking into account the news background, the opening of trading sessions of the main financial centers, and is not a guide to action (placing "sell" or "buy" orders).

Formula for calculating the dollar index:

USDX = 50.14348112 * USDEUR0.576 * USDJPY0.136 * USDGBP0.119 * USDCAD0.091 * USDSEK0.042 * USDCHF0.036.

Where the power coefficients correspond to the weights of currencies in the basket:

Euro - 57.6 %;

Yen - 13.6 %;

Pound - 11.9 %;

Canadian dollar - 9.1 %;

Swedish Krona - 4.2 %;

Swiss franc - 3.6 %.

The first coefficient in the formula brings the index value to 100 on the starting date - March 1973 when the main currencies began to be freely quoted relative to each other.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

Performed by Ratu Taslim,
Analytical expert
InstaForex Group © 2007-2020
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