Trading Week Ahead: Markets Rally on US-Iran Deal Hopes
US indices are surging, fuelled by renewed hopes of a breakthrough in the US-Iran conflict. Reports of a potential agreement in principle have sent oil prices sinking below $100, providing much-needed relief to inflation-weary markets.
However, with liquidity expected to be thin due to the US Memorial Day holiday, analysts remain cautious about the deal’s final details. Meanwhile, the US dollar is softening, gold is catching a bid, and on the corporate front, Delivery Hero shares have spiked to an 18-month high following reports of a potential takeover bid from Uber.
👉 US Core PCE Price Index – 14:30, Thursday (CEST)
The Federal Reserve’s preferred inflation metric. With the previous reading at 0.3%, markets will intensely parse this data for signs that underlying price pressures are easing, which could shape the Fed’s future rate path.
👉 US GDP – 14:30, Thursday (CEST)
The broadest measure of US economic growth. Quarter-over-quarter growth is expected to remain unchanged. A surprise in either direction will offer a critical read on whether the US economy can withstand the recent energy shock.
👉 German CPI – 14:00, Friday (CEST)
Germany’s flash inflation data serves as a key leading indicator for broader Eurozone inflation. This print will set expectations for the European Central Bank’s next moves.
16:00
USD
CB Consumer Confidence
03:30
AUD
CPI
04:00
NZD
RBNZ Interest Rate Decision
19:00
EUR
ECB Press Conference
14:30
USD
Core PCE Price Index
14:30
USD
GDP
14:30
USD
Durable Goods Orders
14:00
EUR
German CPI
14:30
CAD
GDP
| Date | Time | Instrument | Event |
|---|---|---|---|
| Tuesday, May. 26 |
16:00 |
USD
|
CB Consumer Confidence |
| Wednesday, May. 27 |
03:30 |
AUD
|
CPI |
|
04:00 |
NZD
|
RBNZ Interest Rate Decision | |
|
19:00 |
EUR
|
ECB Press Conference | |
| Thursday, May. 28 |
14:30 |
USD
|
Core PCE Price Index |
|
USD
|
GDP | ||
|
USD
|
Durable Goods Orders | ||
| Friday, May. 29 |
14:00 |
EUR
|
German CPI |
|
14:30 |
CAD
|
GDP |
*All times in the table are in CEST
Technical Analysis with FVG Strategy
This technical analysis uses the EMA 20 and EMA 50 to determine market trends, alongside the Fair Value Gap (FVG), which refers to price imbalances caused by aggressive movements, signalling key entry and exit points. This strategy applies to BTCUSD, EURUSD, GBPJPY, US100, and XAUUSD, providing insights into both last week’s market opportunities and the current one.
Opportunities to Watch This Week
EURUSD
Market Context: Today’s open gapped significantly higher from Friday’s close. However, the price has not yet reached the underlying support zone, suggesting a potential retracement to test this area. The overall trend remains below both the 20 and 50 EMAs, indicating that sellers still hold the broader structural advantage.
Bearish Scenario (Preferred): The preferred scenario is a bearish continuation to test the lower support zone. At this level, buyers are expected to step in and drive the price higher.
Bullish Scenario (Alternative): An immediate upward continuation without testing the lower support. This move would aim to fill the overhead liquidity gaps, with a potential target reaching the upper resistance zone.
FVG Setup: No FVG setup formed this week due to a lack of aggressive, displaced price action.
GBPJPY
Market Context: The Pound successfully defended its support level and rallied sharply with an aggressive bullish candle. This move broke through overhead resistance, shifting the market structure back to bullish, and left behind a clean long FVG in the process.
Bullish Scenario (Preferred): The preferred scenario is a continued rally up to the next major resistance level. Until price action shows signs of rejection at this upper boundary, the momentum remains firmly long.
Bearish Scenario (Alternative): A daily close below the current support level would invalidate the recent breakout and shift the market structure back to bearish.
FVG Setup: A bullish FVG formed last week. This setup is active, offering a potential target of 2:1 RRR or an extended run toward the overhead resistance zone.
XAUUSD
Market Context: Gold closed definitively below its support level, shifting the structural bias to the downside. This strong sell-off also generated a new bearish FVG.
Bearish Scenario (Preferred): The preferred scenario is a short continuation targeting the VPOC range (marked by the white line). If the price breaks below this level, the next downside objective would be the March 23 swing low.
Bullish Scenario (Alternative): A breakout and daily close above the immediate resistance would suggest a structural failure for sellers, opening the door for an upward move toward the previous swing highs or the next resistance zone.
FVG Setup: A bearish FVG formed last week. Executing this setup initially carried higher risk, as the price had not yet confirmed a close below support, but the current structure now aligns with the short bias.
US100
Market Context: Today’s session opened with an aggressive gap up from Friday’s close, reflecting strong buyer enthusiasm driven primarily by geopolitical developments regarding a potential US-Iran agreement. The index is currently sitting at an absolute all-time high, fully entrenched in a powerful bullish trend.
Bullish Scenario (Preferred): The preferred scenario is a direct continuation of the upward momentum, as there are currently no technical signs of reversal. However, a short-term intraday retracement to fill the gap and retest Friday’s closing price is a likely stepping stone before the index pushes higher.
Bearish Scenario (Alternative): A daily close below the nearest structural support. This would indicate a short-term cooling of the market and a potential deeper pullback, though current price action does not suggest this is imminent.
FVG Setup: A long FVG hasbeen created and is valid for entry. It offers a potential target of 2:1 RRR, which can be extended further based on individual risk management.
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