Hi Folks.
Welcome to the Not Quite But Almost Final Econ Forecast for the 2026 Summer Doldrums. Price action on a lot of charts is really starting to tighten up, so you can use that as an explanation why most of Europe is on a beach in the south of France instead of in front of their trading terminals right now. Low volume/momentum means fewer trade opportunities and smaller price moves. So if you insist on trading over the next 3 weeks, adjust your expectations pretty much across the board.
Now on with the show.
SUNDAY: Your typical Sunday evening trash-fest. The one interesting set of numbers are the quarterly Japanese GDP numbers, but the last 3 months' results of 4, 12, and 10 pips quickly put that idea to rest. On to Monday.
MONDAY: Asian/London Session: A pair of sub-10 pip moving Japanese numbers open the session at 12:30 a.m. my time and sub-10's can be safely ignored. The CAD CPI number at 8:30 is marginally more interesting because of one of the last 3 numbers (a 25 pip move in May followed by 13 and 14 pip moves in June and July). A lot of Canadian numbers have tailed off over the last few months, which is sad because the CAD CPI used to be an all but guaranteed money maker. But as long as the numbers keep heading towards single digits, it just isn't worth the risk. Pass. The evening session is limited to the Australian Westpac Consumer Sentiment number and this one just doesn't move enough to make the trade worthwhile.
USA Session: Empire State Manufacturing Index at 8:30 and the National Association of Home Builders Market Index at 10:00 are both equally useless as pip generators. Pass on both.
TUESDAY: Asian/London Session: A week or two ago I mentioned that the 2:00 a.m. GBP numbers (CPI, GDP, Claimant Count), like the CAD numbers, had recently fallen on somewhat hard times, and just weren't tossing off the 20+ pip runs we saw every month a few months back. Today we get the Claimant Count number at 2:00 (along with a few related numbers). The last 3 months were 19, 26, and 12, and while the 26 was a nice change of pace, the teen results were closer to what's been going on. Given it's Summer Doldrums, it likely won't matter if the number comes out good, bad or indifferent. Doldrums are Doldrums. So Pass just for safety's sake this month, and if by some miracle we see 25 or 30 pips of movement, next month we'll take it a little more seriously. After this, it goes downhill quick, fast and in a hurry. Even the New Zealand PPI numbers (4, 2, and 2 pips over the last 3 months) are simply not worth the time.
USA Session: 8 numbers, each one worse than the number before it. This is the kind of lineup I'd like to see on a Friday so I could take the day off and know in my heart I won't miss a single solitary thing.
WEDNESDAY: Asian/London Session: Another 2:00 a.m. GBP report, this time the CPI. I've mentioned many times the GBP and USD CPI are the only two worth trading, and so far, that holds true (21, 28, and 31 pips over the last 3 months). Definitely the best trade opportunity this week. The rest of the numbers aren't worth looking at , including the Red Folder Australian Employment Change number, which has posted 3 stellar months of results (4, 13, and 15 pips) so by stellar I mean a complete waste of time. So focus on the GBP CPI to the exclusion of all the other numbers.
USA Session: Crude Oil at 10:30 and the Minutes of the last Fed Meeting at 2 p.m. The minutes are guaranteed interesting reading given the split in votes between raise rates and stand pat, and now a set of CPI and PPI numbers last week that show little to no inflation on both the retail and wholesale levels. But it still isn't tradable.
THURSDAY: Asian/London Session: Lots and lots of numbers today, and if you add up the pip counts of each one, collectively they likely won't add up to 20 pips. This is yet another day that would fit better on a Friday so we could quit on a Thursday and turn it into a 3 day weekend. As it turns out (as you'll see in a moment) tomorrow isn't exactly all that either, so maybe a 4 day weekend isn't such a bad idea. And the next two weeks are probably going to look a lot like this as well. This is another sign of the Summer Doldrums.
USA Session: Philly Fed Manufacturing Index and Weekly Unemployment numbers at 8:30 continue to fail to impress, Conference Board Leading Index at 10 is one of those Index numbers that does absolutely zero in terms of price action, and NatGas at 10:30. Not exactly a great lineup to generate 20+ pips. Another sad day of numbers.
FRIDAY: Asian/London Session: A pair of Retail Sales numbers (GBP at 2:00 and CAD at 8:30 a.m.). GBP (17, 15, 11 the last 3 months) and CAD (10, 9, and 7 the last 3 months) means both can be ignored. Then we come to the Flash Manufacturing and Services PMI numbers out of France, Germany, the Eurozone and Great Britain. Rather than go with the Trend = Trade call, I went back and looked at the actual price moves for the last 3 months, because out of nowhere FF bumped these numbers up to Beige Folder status. It was then I noticed all the previous PMI numbers were suddenly Beige Folders going back several months. So likely this was someone pushing the wrong button somewhere. Because looking at the 2 hour period (3:30 to 5:30 a.m.) covering the release of all the numbers, the EURUSD moved 41, 35 and 20 pips. And it wasn't exactly one way price action. Lots of smaller moves, none of them 20+ pips or more. So rather than try and determine trend or no trend, just ignore these numbers until further notice.
USA Session: And that goes for the only two numbers in the US session today, which happen to be the US version of the Flash Manufacturing and Services PMI, which historically do absolutely nothing. So that 3 or 4 day weekend is probably looking pretty good right about now.
See you back here next week for yet one more exciting Summer Doldrums Econ Forecast.
Jeff
