17.30 Moscow time. USA: Department of Energy data on crude oil inventories.
21.00 Moscow time. USA: Publication of the minutes of the Fed meeting.
The forecast of the euro against the dollar pair EURUSD today 05/20/2020
The ECB announced on the eve that it will continue the program of quantitative easing despite the decision of the German Constitutional Court, which banned these operations. This is a positive signal for the euro, as investors did not rule out the possibility of suspending the quantitative easing program. The German ZEW institute pleased traders with positive data - in May, the mood index in the business environment updated the annual maximum. The German economy was one of the first to leave the quarantine caused by COVID-19, which is positively perceived by investors and economists. In the interbank lending market in New York and London, there is a trend towards lower interest rates on dollar loans. There are so many dollars in the world now that bankers do not know what to do with them. In such periods, the exchange rate of the American currency shows a decline. Tonight will be published the minutes of the last meeting of the US Federal Reserve, where I do not expect surprises, since the FOMC head has already provided all the key guidelines to the market. What do we have in the dry residue? Players should wait for the growth of quotations of the European currency.
EURUSD recommendation: Buy 1.0920 / 1.0900 and take profit 1.0975
Forex forecast GBPUSD today 05/20/2020
The positive dynamics of the UK labor market allows us to expect that the economic collapse from the coronovirus will not be as widespread as investors initially expected. The unemployment rate fell by 0.1%, contrary to the expectations of investors, who were guided by the growth rate in the range of 0.4%. Today, a release on British inflation for April will be published, which will indicate a decrease in the indicator to an annual minimum. For the pound, this is a negative signal. In the afternoon, the US Department of Energy will publish a fresh release on oil reserves in US storage facilities. Since the number of drilling platforms is at a minimum over the past sixty years, we can expect a decrease in hydrocarbon production, which will lead to a decrease in black gold reserves. This is a positive signal for the oil market, which may support the pound,
GBPUSD recommendation: flat 1.2210 -1.2290
Dollar yen forex forecast USDJPY today 05/20/2020
Today, a mixed background is forming. On the one hand, we can expect a drop in quotations against the background of negative dynamics in the debt market, where the spread in the yield of 2-year US and Japanese government bonds shows a decrease. The day before, D. Powell and S. Mnuchin spoke in Congress, saying that the financial authorities would continue to “print money” to save the US economy from the consequences of COVID-19. This factor, in turn, will inhibit the growth of US bond yields. On the other hand, a decrease in the VIX “fear” index indicates a continuation of the uptrend in the US stock market, which in turn can provide good support to the “bulls”, given the high correlation of USDJPY and S & P500.
USDJPY recommendation: flat 107.50 -108.20