FOREX CHART ANALYSIS MAY 21 - MIXED SIGNALS
Near the end of the week, the market is showing many conflicting signals. Read our chart summary to get the idea of what should be your forex trading strategy.
- The Stat website, a reputable medical site, argues that the Moderna company's press release on Monday, which references the antibodies produced by its experimental drug, contains too few details and is too small to have meanings.
- New hot spots of the Covid-19 pandemic are increasing in emerging markets. The most prominent of which are Russia and Brazil.
- The British government has for the first time in history sold bonds with a negative interest rate as speculation on the possibility of BoE to continue lowering interest rates is increasing.
- Oil prices stabilized near recent highs after the American Petroleum Institute (API) estimated that its oil reserves fell 4.8 million barrels last week - the first decline since March and the biggest since January.
On the USDJPY chart, the price tested the MA20 area on the H4 timeframe and generated bullish signals. Anyone who has ordered long can continue to keep. If you do not have an order, you can enter it according to the signal. You should only consider adding positions when the 108 area is broken. This will ensure a more sustainable rally. The target is 109.
The price did not drop much after the bearish signal, but rather re-tested the boundary of 1.10, which is increasing the probability that it will be broken. However, at present, there is another decreasing sign on the H4 chart which is detrimental to the buying decisions. Therefore, only consider buying new when price breaks 1.10. Range traders should not shorten at this time because the risk is increasing.
The selling has begun to reappear on the GBPUSD chart. Pay attention to the trend line. What is needed for the sellers now is that the price has to penetrate this line to return to the downside. On H4 chart, there is also a decreasing signal. You can return to short by this signal. In the short term, it is expected that the price will break the bottom and return to the area of 1.20.
On the USD/CAD chart, yesterday we were considering buying option for range traders because the RR level is quite good. However, the price did not recover after the uptrend, but tested support again. This is detrimental to the buying decision. The ability of breaking support is increasing. You should not continue to buy, instead wait for a breakout to decide what’s next.
The price finally broke the peak in 2 months but with a disappointing force. The bearish signal appears soon after and is very close to the important resistance zone, which implies a false-break. You should not buy at this time. The probability of a correction appears to be increasing.