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Forex Weekly Trading Outlook: Key Events to Watch for JPY, USD, and AUD

Key Economic Events Impacting Forex Markets

As we enter the new trading week, several critical economic events are set to shape market movements, particularly focusing on the Japanese Yen (JPY), US Consumer Confidence, Australian inflation data, and the US CORE PCE Price Index. Here’s a detailed look at what traders should keep an eye on.

Japanese Yen (JPY) in the Spotlight with Governor Ueda’s Speech

At the start of the week, all eyes will be on the Japanese Yen (JPY) as Governor Ueda delivers a speech at the Institute for Monetary and Economic Studies in Tokyo. Market participants will be keenly listening for any hints on monetary policy direction or economic outlook from Governor Ueda. Any signals of policy shifts could lead to significant volatility in JPY pairs, making this a crucial event for forex traders.

US Consumer Confidence Expected to Decline

Midweek, attention will shift to the United States with the release of the US Consumer Confidence data. The forecast suggests a slight decline to 96.1 from the previous reading of 97.0. If the actual figures come in higher than expected, we could see a resurgence in USD strength. Conversely, a lower reading could weigh on the US Dollar, reflecting potential concerns about the economic outlook and consumer spending.

Australian Inflation Data: AUD CPI Forecast

The Australian Dollar (AUD) will also be under scrutiny with the release of the year-over-year Consumer Price Index (CPI). The forecast indicates a minor drop from 3.5% to 3.4%, suggesting that inflation remains stubbornly high in Australia. Persistent inflation could influence the Reserve Bank of Australia’s future monetary policy decisions, impacting AUD performance.

US CORE PCE Price Index: Major Risk Event

To close the week, the market will focus on the US CORE PCE Price Index month-over-month release. As the primary inflation measure monitored by the Federal Reserve, this data point is seen as a major risk event. Any significant deviations from expectations could trigger substantial market reactions, influencing Fed policy expectations and subsequently impacting the USD.

Summary: Prepare for Potential Market Volatility

This week promises to be eventful, with several key economic indicators set to influence the forex markets. Traders should remain vigilant and prepared for potential volatility, particularly around the highlighted events:

Governor Ueda’s Speech: Impact on JPY.

US Consumer Confidence: Possible USD movements.

Australian CPI: Implications for AUD.

US CORE PCE Price Index: Major risk event for the USD.

Stay tuned for these developments and adjust your trading strategies accordingly to navigate the potential market fluctuations effectively.

USD Index

USD Index- Forex Week Ahead Analysis- 27th May

The price on the chart has traded through multiple technical levels and some observations included:

  • The USD Index recovered somewhat last week, however price has now reached the resistance of 105.00. If the price forms a lower high here we could expect another move lower towards the trendline support. 
  • Alternatively, if the price can trade back above the 105.00 key handle, then sellers may lose interest and buyers may take over.

GBPUSD

GBPUSD- Forex Week Ahead Analysis- 27th May

The price on the chart has traded through multiple technical levels and some observations included:

  • The GBP surged to the top of the currency strength meter this week, this means we could see a continuation of the current bullish bias or a reversal.
  • Looking at the price of cable (GBPUSD) it remains above the support of 1.2700. 
  • Buyers could look to drive prices higher towards highs at 1.2800.

AUDUSD

AUDUSD- Forex Week Ahead Analysis- 27th May

The price on the chart has traded through multiple technical levels and some observations included:

  • The AUDUSD breached through a bullish channel of support last week showing signs of potential weakness.
  • The daily time frame trend still remains bullish so downside may be unlikely if price remains above 0.6580.

USDCAD

USDCAD- Forex Week Ahead Analysis- 27th May

The price on the chart has traded through multiple technical levels and some observations included:

  • The price of USDCAD rebounded from the highs around 1.3725 on Friday as USD weakness re-entered the market.
  • The volume below the 1.3600 handle still looks vulnerable here and a break lower could be likely. 

Have you watched our latest video update? You can see it here. 

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