Weekly trading forecast November 19 - 23

The upcoming trading week seems to be comparatively thin if you looked at the economic calendar, especially in the United States. However, that impression could be wrong as we are heading into an exciting period of the yearly trend to change. Investors and traders worldwide will be listening carefully to politicians trying to catch any single word regarding future changes. The week ahead is crucial for the U.S China trade deal as it’s not so many time left before the G20 summit in Argentina. Are the two largest economies close to a trade deal, finishing the scary tensions and trade war talks? That’s a million dollar question. Another story in the focus of the financial market traders is the Brexit saga. This week is crucial not only for the UK- EU Brexit deal deadline but also for the British Prime Minister Theresa May’s fate to stay on her position. The recent political issues could turn into a real turmoil for the country. BoE Carney’s speech and Inflation report hearings are also important for the sterling. The single European currency, as well as emerging markets, are vulnerable to the risk-on sentiment, following the situation with U.S. stock indices closely. Japanese Yen’s safe-haven role will be even more important in such an environment.

Monday, November 19.

Japanese traders will monitor Adjusted trade balance in the country as well as exports and imports figures. Those reports are crucial for USD/JPY which bounced down to 112.80 support level last week and the big question is whether that was just a correction or the trend reversal. The Bank of Japan Governor Kuroda will host the press conference about the economic outlook and monetary policy perspective. His speech is expected to support Japanese exporters by verbal intervention to lower the exchange rate of the local currency. The European and American economic calendars are traditionally empty on Monday. So, traders will watch the situation with the task indices in order to find the direction of trading for EUR/USD. The British Pound is traditionally vulnerable to Brexit headlines which will influence the GBP/USD price action on Monday as the deadline of November 25 is nearing.

Tuesday, November 20.

Tuesday Asian trading session will focus on Reserve Bank of Australia’s meeting minutes which are scheduled to be published at 00:30 AM GMT. As long as AUD/USD has completed the technical reversal pattern on the daily timeframe, the Aussie bulls will be looking for support from the fundamental side as well. RBA Governor Lowe is due to speak at 08:30 AM GMT with the same bias to expect. Inflation Report Hearings and BoE Governor Carney’s speech is crucial for the falling sterling. There is a huge doubt that MPC could have any influence helping to find the bottom for the cable bulls. The only hope is for the Brexit positive outcome and political tensions to ease the pressure. Housing data will be in focus for the U.S. traders with the headline report of Building Permits in October. A slight decline is expected compared to the previous month, however, the report might be even ignored by investors as all eyes are on the Federal Reserve. The regulator has changed its tone in the scope of further tightening and that could be a supportive factor for the U.S. stock indices. The Loonie’s strength will be put under the question during the BoC Gov Council Member Wilkins’ speech. The API weekly crude oil stock report will finish the busy Tuesday trading session in the U.S.

Wednesday, November 21.

Emerging markets will keep watching the development in the U.S. - China trade war story with the hope of a positive outcome and the deal between the two largest economies in the world. South African Rand will be vulnerable to the country’s Consumer Price Index report which is scheduled for 08:00 AM GMT. A robust growth is forecasted for October. If that confirmed, USD/ZAR might continue its bearish run and the psychological round number of 14.0000 would not stop sellers from further Southwards pressure. Core Durable Goods order will be watched by the greenback traders and equities investors. A strong growth of 0.4% on monthly basis is expected while the previous reading was just 0.1%. That could turn as an additional supportive factor for the U.S. stock bulls while the dollar’s reaction might be completely inverse. Existing Home Sales will continue the weekly housing sector data. Crude Oil inventories could become another reason for the price of oil to lose the ground as further growth is forecasted in oil stocks.

Thursday, November 22.

Japanese Consumer Price Index will be published at 00:30 AM GMT on Thursday with modest growth expectations. The European trading session will start with the meeting minutes of the latest ECB decision. Consumer Confidence forecast for the Eurozone is also due to release. Both events have a straight impact on the EUR/USD exchange rate and the biggest question is about the bulls’ ability to push the pair towards 1.1500 handle. Corporate Profits figure is the only event in the American trading session as the United States traders will be off for the Thanksgiving holiday.

Source: Master Investor

Friday, November 23.

One of the thinnest trading days is expected on Friday as Japanese traders will be also out of the working places due to the Labour Thanksgiving Day. United States exchanges will have an early close at 13:00, so a lower volatility is expected. The only busy region will be Europe. The economic calendar is full of different events. It will start with the German GDP and Manufacturing, Servies and Composite Purchase Managers Index. All of them are forecasted to remain flat compared to September. The same reports will be released for the European Union later. The market consensus is on a lower bias though. Therefore, a bearish slide is more likely for EUR/USD in the thin market conditions. The volatility should pick up for USD/CAD as the Canadian economy will report Core Retail Sales and Consumer Price Index. All of that data is extremely important for the Bank of Canada in the light of their hawkish tone. If the reports will be able to confirm the regulator’s intentions to hike the interest rates, then the Loonie will surge.
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