The Week Ahead 2nd January
Patrick Reid
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Patrick Reid
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- ? We start 2017 with a bang and it's a big week of data. Non-Farm, US ISM PMI's, EU CPI, FOMC Minutes, and UK PMI’s (Services in focus)
- ? Are we turning around on USD strength sentiment or was it just profit taking YEAR END last week? Either way data should steer price action. Or trump needs to hint at two things for another price leg up. (1) Details on fiscal stimulus (2) de-regulation on The Frank Dodd Act and if so US bank equities will fly to the moon. That being said both look unlikely prior to the inauguration 20th January. At the moment yields are off their highs. I think USDJPY has suffered most with a little RISK OFF thrown in too. As a result it’s looking the most toppy. Forex Live have a nice yield chart for 2016 see header image.
- ? USDJPY 118.50 now a roadblock. 115.20 good but 114.80 my favourite BUY. It was great resistance on the way up so it should be tough support on the way down.
- ? EURUSD spike in Asia Friday morning. It might have been Algos but who cares. 1.0500 now key to stay above for bulls. This broke today again so look for sellers otherwise the waters get muddy.
- ? Risk events: Trump tweeting about Fiscal Stimulus details or Frank Dodd de- regulation prior to Inauguration 20th January
- ? Cable levels 1.2350/80 will be fought tooth and nail by bears to stay below. It’s a very sticky area so sell into any squeeze. 1.2275 not bad to have a small buy if we test down there again
- ? A Call to Trade - Look out for 3 great risk/reward trades this week and I’ll be on linked in with updates.