The week ahead
This week is relatively soft for high-impact news, with the majority of important events coming out of Australia. Aussie traders should watch their news feeds closely this week with rate statements, GDP data and RBA speeches dominating the economic calendar.
What To Expect
Today Positive PMI data has come out of China, with nearly 1% positive deviation on both Non Manufacturing and Manufacturing PMI’s. This comes after China injected 20B Yuan into the economy last week, so the USD/CNY pair could be one to watch for movements this week.
Later today the European Central Bank’s President Lagarde is giving a speech, detailing the EU’s current economic conditions, and outlining the ECB’s position and forecast. Lagarde’s speeches can typically be a market mover, so traders should watch closely for any change in tone, as well with her speech later this week. For the Euro, Germany's Harmonized CPI is being released later today, with an expected 0.5% contraction. The Euro has been sold against most non-dollar pairs in the previous weeks, so any positive deviation could spur a bullish movement. EUR CPI data is also due in tomorrow, forecasting a slight growth, however still in negative readings.
The AUD is certainly a currency for traders to watch this week, with the Reserve Bank of Australia announcing their interest rate decision and giving a statement that will give further insight into their stance. The AUD has been in a strong bull market since mid-march, comments from the RBA could spur the AUD on the next leg higher. Westpac forecasts AUDUSD at 0.75 by the end of 2020. Also concerning the Aussie is RBA governor Lowe’s Speech on Wednesday, prior to the release of Q3 GDP Data. Traders of the AUD should have a very close eye on news feeds throughout the week.
Traders of the Swissie be aware of the upcoming GDP data, as it is forecasting significant growth. The previous quarter had a GDP contraction of -7.3%, and Q3’s forecasted to have over a 5% growth, so be aware we may see a surge in CHF. This would give the USDCHF downtrend a renewed flame.
Traders of the America’s should be mindful of both Canada’s Q3 GDP data release tomorrow, with the consensus that economic conditions have worsened still, and the Fed Powell’s Speech, which is usually of high significance to USD direction. USD Manufacturing data is also set to be released tomorrow, with the consensus being a slight contraction has occurred during Q3 compared to Q2.
The Tonisignals team hold a bearish bias for the USD over the coming weeks/months and are bullish on AUD, and so we are looking for opportunities to take advantage of these biases. Given CHF GDP consensus there is likely to be some opportunity on the USDCHF as well.
Keep an eye on the news feeds and manage your risk this week.