Friday night saw broad-based US Dollar strength as the Index bounce off last week’s 1.0035 level and finished the week flat. Some continued pressure on the AUD/USD – breaking and closing below the 0.7700 level – the week ahead sees two Governor Lowe speaking events, Meeting minutes and Private CAPEX to provide further direction and trading opportunities.
The Yen Rose against the majors with the USD/JPY settling around the 112.850 level due to French election concerns. UK Retail sales for January come in weak, a third month of falls.
An alliance in the Presidential election between the French Left could increase the chances of anti-EU, anti-immigrant Marine Le Pen winning the presidency. As a result, the euro fell 0.5% against the dollar at $1.0608, next major support at the $1.052 level.
Uncertainty around Fed Chair Janet Yellens conviction towards raising rates in March is being questioned by the market. Keep an eye on voting members’ Kashkari and Harker this week for clues, as they both speak early Wednesday morning.
Gold currently waiting on which side wins the tug of war – ‘The strengthening dollar and Trump policy promises’ Vs ‘European political uncertainty and the truth behind Trumps promises’.
Oil experienced low liquidity and volatility last week, as it traded in a $1.70/bbl range. Production cuts by OPEC and rising weekly inventories the likely cause of the price stability.
Breakout traders be aware of some interesting daily resistance levels in the Australian and Hong Kong Index’s playing out at the moment. The ASX200’s 9th Jan 5,833 level and the Hang Sengs ~24,150 level may provide opportunities over coming sessions.
This week’s major economic announcements All times AEDT (GMT + 10:00)
Monday
- Bank Holiday: U.S Presidents Day. Canadian and US equities closed, US soft commodities closed.
- 8:45AM NZD: PPI Input q/q
Tuesday
- 11:30AM AUD: Monetary Policy Minutes
- 7:00-8:00PM French/German/EUR PMI numbers
Wednesday
- 12:50AM USD: FOMC Member Kashkari Speaks
- 4:00AM USD: FOMC Member Harker Speaks
- 8:30AM AUD: RBA Governor Lowe Speaks
- 8:30PM GBP: Second Estimate GDP q/q
Thursday
- 12:30AM CAD: Core Retail Sales m/m
- 6:00AM USD: FOMC Meeting Minutes
- 11:30AM AUD: Private CAPEX q/q
Friday
- 12:30AM USD: Unemployment Claims
- 3:00AM USD: Crude Oil Inventories
- 9:30AM AUD: RBA Gov Lowe Speaks
Saturday
- 12:30AM CAD: CPI m/m
