Special Consultant to the FPA
Forex News Trading Strategy for the 17th - 21st of October
Last week the greenback finished strong; advancing against most of its major counterparts with the notable exceptions being the Canadian and Australian dollars. Strength in the commodities market helped to support both commodity dependent currencies, even in the face of a USD rally.
Coming up we have a busy week with potentially impactful data throughout. Chinese growth, U.S. and UK inflation, UK and Australian employment, as well as BoC and ECB meetings, all make for a likely volatile week of trading.
Monday begins with comments from a pair of central bankers. However, while we don’t anticipate any surprises, it is always important to remain vigilant. ECB President Draghi will speak to deliver welcoming remarks at the European Cultural Days of the ECB. The RBA’s Governor Low is due to speak about inflation and monetary policy at Citi's Annual Australian and New Zealand Investment Conference. The highlight of the day will be the New Zealand inflation print for the third quarter.
The RBA will release its Monetary Policy Meeting Minutes to start the Tuesday session. Then the focus turns to inflation for both the London and New York sessions. During London, we will get the latest CPI print from the U. It will be followed by consumer prices in the U.S. during New York. Also on Tuesday, we will see if dairy prices can bounce back, or continue to decline for a second consecutive fortnight when the GDT report is released.
A very busy Wednesday begins with a potentially volatile Chinese growth report. Last week we saw markets turn risk averse after a worse than expected trade surplus renewed fears that the world’s second largest economy could be faltering. However, September consumer and producer prices helped to alleviate those fears, both coming in above expectations.
UK employment will be highlight of Wednesday’s London session. The August claimant count rose just 2,400, still not showing very much impact from the June Brexit vote. During the New York session, we will hear from the BoC when the central bank announces its latest policy decision and statement. The decision will be followed by a press conference a little more than an hour after the initial announcement.
Australian employment data leads the way on Thursday, with jobs expected to have increased 15K in September, after a decline of 3.9K in August. The unemployment rate is expected to tick higher to 5.7% from 5.6%. However, the participation rate is also expected to rise one tenth to 64.8%.
During Thursdays’ London session we will see the UK Retail Sales report for September, followed by the day’s main event, the ECB rate announcement and press conference. There has been plenty of recent speculation about the ECB potentially starting to taper its QE program, however that is not expected to be the case at this meeting.
We finish the week on a lighter note, with only the Canadian consumer prices and retails sales figures of note during Friday’s New York session. Nevertheless, we expect this week packed full of opportunities with plenty of data and information to keep market participants engaged.
You can find other Forex news trading events taking place this week here: Forex Factory Calendar.
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