Thanks for visiting our blog to read the weekly outlook about the forex market, which we will update every weekend on every Saturday/Sunday frequently.
Our writing is a bit different to other sites, in which we will also include our technical analysis with drawn charts for your reference, so that you can see how other ideas are. So please take note of this.
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About the trading sessions for next week from Feb 27- Mar 03,2017, we will start with following events which will affect the Currencies market:
Mon Feb 27, 2017:
This week, we start with the USD firstly
Core durable goods orders m/m
Pending home sales m/m
FOMC member Kaplan speaks
Those events are very important for Fed to estimate the economic health in the US to decide hiking rate in the coming month(s).
2) NZD (Kiwi)
- Trade balance
- ANZ business confidence
The Kiwi after lost its value vs. the bucks from July 2014 until end of August 2015, Kiwi has been started rising against the bucks since Sept 2015 until now; anyway, Kiwi has been still faced difficulty to break the level of 0.7347x from the weekly chart as below:
The trade balance and ANZ business confidence on Monday are, according to our opinions, not really as main drive to affect the Kiwi vs. USD on this Monday, due to there are some more important events in the next days.
3) AUD (Aussie)
- Current Account
That is not really important for the Aussie, because it just duplicates the trade balance. Aussie in a technical point of view at D1 TF, there is likely a divergence to see and the prices have been forming a type of an ending diagonal of the A leg in a corrective wave, see the chart below:
The last trading candle at D1 TF was quite dramatic, anyway it is still in the box and a breakout of either direction ( so both for a up scenario and down scenario), it can be led to significant level to make a huge profit; currently it has been trading in our drawn diagonal range and we will keep watching its further development.
Tue Feb 28,2014
- RMPI ( raw materials price index)
That event has just a medium impact on the Loonie but it might be as an important indicator for BOC to decide about the rate hike later this week. According to the TA at D1 TF, we can see that on the one hand the USD somehow losses its strength vs. CAD, and on the other hand the rising in OilPrice recently has pushed Loonie up.
Take a look at the chart below for your reference about the impossible levels that CAD can reach vs. USD in the coming time.
For the week, so until Mar 03,02017, I think that USDCAD will be traded in a range of about 318 pips according to our drawn chart.
- Prelim GDP q/q
- Chicago PMI
- CB Consumer Confidence
More important is the GDP q/q, then we have the CB Consumer Confidence; Fed is watching for those very much for its rate hike decision, which have been reflected in the FOMC Minutes last week.
3) AUD and CNY
- AUD, GDP q/q
- CNY, Caixin Manufacturing PMI
Aussie is waiting for those events for a next lager move, because the Chinese Caixin manufacturing PMI is somehow as a catalyst for the Australian economy in the sense of importing raw materials from Australia. The more the Chinese industrial productions are expanded, the more the Chinese will need more raw materials from other export countries; anyway traders are eying on the coming-releasing data from the US about Unemployment, so we have a very interesting week ahead.
Wed Mar 01, 2017
- German Prelim CPI m/m
- German Unemployment change
Both above events on Mar 01 are actual quite important for the EUR because the German is the leading economy in EU and it affect the EUR somehow very much but in the current situation in the EU with Frexist an Italy, the EUR are under pressure vs. the USD due to its political “unrest”. Therefore lower CPI and higher unemployment rate in Germany will push the EUR more down vs. the USD.
- Manufacturing PMI
- Net Lending to individual m/m
Last week the Second Estimated GDP q/q was released more than expected with 0.7% growth, which indicate d a slight improving for the British economy with further economic improvements in the UK, then there is a sign for rate hike at the end of this year. About the TA for the cable vs. the USD we can see that a the D1 TF the price zone from 1.211xx up to 1.27000 have been mostly trading since Oct 12, 2016 up to now; see the chart below:
Currently Cable is trading upside from that mentioned range level, any break out/down that range could bring cable to a clear trend, namely for both directions, up/down trend.
We keep watching it.
- BOC Rate Statement
- Overnight Rate
High interesting day for CAD; with the current higher Oil price and economic situation in Canada, a rate hike by BOC, according to our opinion, probably occurs this time.
Our TA at D1 TF about the USDCAD indicates that a upside from USD can only happen, if the candle at D1 TF closed above the level at around 1.3280x; the current price of USDCAD was trading below our daily pivot point at 1.31265 ( below the PP at a higher TF indicates a downside/losing the strength to pop up).
Anyway, we think that whether the BOC will hike the rate or not, USDCAD will be traded this week in a range from 1.2928x-1.3241x ( the chart below we update again, because it will use for this week!)
- ISM Manufacturing PMI
- Crude Oil Inventories
- FOMC members Speaks
It is also an important news release for the greenback but the market is eying more on the coming soon jobs data from the US and the speaks of FOMC members this week. The DXY did test recently twice the level of 101.7x and the last candle at D1 TF on Friday closed bullish so a further raising for the USD is likely continuing next week. Take your look at the DXY chart below for your reference:
Thu Mar 02, 2017 and Fri Mar 03, 2017
- GBP Construction PMI
- CAD GDP m/m
- USD Unemployment Claims
- GBP Services PMI
- USD ISM Non-Manufacturing PMI
- USD Fed Chair Yellen Speaks
Those two days are very important for Cable and USD; of course, other currencies like AUD, NZD and EUR will also be affected by those events, because some clues about the NFP and rate hike decision in the coming days in March 2017. Most investor and traders are the opinion that Fed will hike the rate in May 2017, we think 0.25 basis points at least will be hiked this month.