Hi Folks.

Here is the final forecast for the month of August, and it's a doozy, and by a doozy, I mean it's one of the worst weeks for news I can recall seeing in a very long time.

SUNDAY: Two entries from New Zealand at 6:30 p.m. my time: Retail Sales and Core Retail Sales. FF has the overall number listed as a Beige folder, which has to be a mistake. since the NZ Retail Sales Combo averages about 5 pips in the 15 minutes after the release. So don't rush to get your charts open Sunday afternoon for this one.

MONDAY: Asian/London Session: We start with the German ifo Business Climate number, which, when combined with other more important numbers (like happened 3 months ago) you get a 30+ pip move. As a standalone number (like the last 2 months) you get 13-15 pips. It's a standalone number today. Not exactly the sort of report we want to award Beige status. Pass. At 8:30 a.m. we get Canadian Corporate Profits q/q and I do believe this is the first time I've ever seen this particular number on the FF calendar. 2-3 months back it was a standalone number and generated 13 pips both times. Last month it was linked to Retail Sales and with those numbers showed a 30+ pip move. I feel confident saying all but 13 of those 30+ pips came from the Retail Sales numbers. Today it is once again a standalone number. So unless you like 13 pip trades, Pass. Belgian Business Climate is one of those flake numbers that never comes out on time, so don't bother with it. At 7 pm the Brits release a BRC Shop Price Index y/y number, which historically does nothing, mostly because it comes out at a minute after midnight local time. Pass (and if you haven't figured it out by now, I'm going to be saying "Pass" a lot this week). At 7:50 p.m. we get the Japanese Services PPI, which for the last 3 months has flirted with both sides of my 20 pip Red Line. Given the absolute lack of tradeable numbers so far this week, this one might overperform. Plus, it's an Asian number dropping right after the Asian open, and for a lot of Asia, August is just another month on the calendar, as opposed to this major holiday month Westerners think of it as. So those two factors might boost this one by a few extra pips. Keep an eye on it. We close out the evening with the Australian Monetary Policy Meeting Minutes, which aren't a number but might cause a small stir. Still, there isn't anything we can do with this one except watch.

          USA Session: New Homes Sales at 10:00. I rarely if ever have anything nice to say about real estate numbers in the US since about 2010 when some big wig from the National Realtors group admitted they just made most of these numbers up out of thin air. RE numbers ceased to matter within seconds, to me and just about everybody who heard his confession. But since we have so little to work with this week, I took a closer look at the last 3 months. 3 and 1 month ago, we had two big misses, one to the upside by 40,000 sales and one to the downside by 20,000 sales. The upside miss caused the EURUSD to jump 31 pips, while the downside miss created a doji candle that was 23 pips apart from the tips. The third number, which was a miss to the downside by 70,000 sales, and which dropped at the same time Powell from the Fed was set to testify before a Senate banking committee, generated a whopping 15 pips in the 30 minutes after the number dropped. What does it all mean? Beats the hell out of me. But Powell is still sleeping off his trip to Wyoming this weekend, so once again the housing number has to live or die all on its own, so pay at least a little attention at 10:00 a.m. but remember, last week of August, so don't expect too much. Fed Speak at 3:15 and 7:15 p.m. No one cares.

TUESDAY: Asian/London Session: We lead off with a warning: The Japanese Core CPI, set for 1:00 a.m. this morning, has a history of not exactly hitting the wires right at 1 a.m. Sometimes it's 1:01 and other times it has been 1:02 a.m. I hate unreliable numbers. But with this one, if it comes out on the nose of the expected number, such as it did 2 months ago, you see very little. If the number comes out better or worse than expected, 20-30 pip moves are in the offing. So be aware of this one, and be aware that it might be running a tiny bit late. But if it misses expectations, the wait is probably worth it. At noon we have British Fed Speak; at 8:30 p.m. the Australian MI Leading Index number (Pass) and at 9:30 p.m. we get Construction Work Done q/q (Pass) and their CPI y/y number, which is a Red folder FF report but one of those Red Folder numbers that generates a measly 10-12 pips after release. Pass.

          USA Session: A busy session today, but only in terms of the number of reports, not the quality. Durable Goods (Overall and Core) drop at 8:30 a.m., at the same time Barkin from the Fed is set to speak somewhere about something. It won't matter. But the Durable Goods number has been the source of at least a small amount of price action over the last few months since the propellerheads who generate these numbers have missed by miles compared to the expectations, and the misses have been so drastic the market has actually paid attention and thrown in a few extra trades as a result. So this is one where you really want to be ready when the number pops up. If it's a miss, be ready to trade. After Durable Goods, the quality drops dramatically. 2 Housing numbers at 9:00 a.m. (Pass); Conference Board Consumer Confidence and Richmond Manufacturing Index are 10:00 and neither do much alone or together to move prices around, so even though it looks like the kind of day where the onslaught of numbers will force price to move one way or the other, I wouldn't put any of my money at risk on these two; and to close the day we get the API Weekly Bulletin, that Oil forecast that now comes out the day before the Oil number. Oil is closed by now so nothing here to work with.

WEDNESDAY: Asian/London Session: We start with the German GFK Consumer Climate number at 2:00 a.m., and this one at best moves the EURUSD around about 13 pips and usually less. Pass. The Swiss follow up at 4:00 a.m. with the UBS Economic Expectations number. 3 months ago it stuck it's nose just across the 20 pip Red Line but the last two months have been closer to 10 pips. 3 months ago the number dropped at the same time Kashkari from the US Fed was speaking in Europe, so that likely had some impact on the USDCHF, or at least enough to get it over the 20 line. Kashkari is probably in bed sleeping off his Wyoming trip from this weekend, so no help from him tonight. Pass. At 6:00 a.m. the Brits drop the CBI Realized Sales number, which has been a 10 pip mover in 2 of the last 3 months. In that third month it did manage to squeeze out 22 pips, but in looking at the numbers this one has been missing by 8-10 points most months, but 2 months back it missed by 22 points (expectation was -24 and it hit at -46). As is often the case, the market will look at bad numbers but act on really bad numbers in certain instances and I believe 2 months ago was one of those instances. So watch the number (expectation is -28). If it comes in at -50 or something crazy like that, you might have a trade. The 9:00 p.m. New Zealand ANZ business Confidence pips number tends to come in around the same level as the number itself (very, very small) so Pass. And at 9:30 p.m. we get the Australian Private Capital Expenditure number q/q, which previously failed to generate very much by way of price action, but last month popped off 50+ pips. No other numbers were listed on the calendar and the actual number came out as a miss, but the other numbers missed as well, and one by a larger margin. One big number does not a trend make, but at this point let's keep an eye on this one to make sure we aren't seeing some sort of sea change in market attitude towards the Private Capital number.

          USA Session: Crude Oil at 10:30 followed by meaningless Fed Speak at 11:45. Sort of a typical August Wednesday, so unless you trade Oil, don't bother.

THURSDAY: Asian/London Session: We start with the Swiss GDP q/q, which FF mistakenly listed as a Beige Folder number. I mean, I get it, since it's a GDP number, but this one barely rocks the boat in terms of price action, except last time, when we saw 30+ pip drop in the USDCHF after release. But a large drop in the UC was already underway when this number simply added fuel to the fire. So likely it was an anomaly and this time it goes back to its 13-15 pip ways. At 4:00 p.m. the Euro Zone releases the M3 Money Supply and Private Loans y/y numbers, which are almost always paired together for release. If the object of the pairing is to generate some significant price action, mission failed. 14-15 pips at best. Pass. The Italian Bond Auction is listed as Tentative and the Euro Monetary Policy Meeting Minutes aren't a tradeable number, so pass on both. At 8:30 a.m. Canada releases their Current Account number, which is a repeat of their monthly Trade Balance number released earlier, so pass. Japan releases two groups of numbers tonight as they do each month at the same times: Tokyo Core CPI y/y and Unemployment Rate at 7:30 p.m., followed by their Preliminary Industrial Production m/m and Retail Sales y/y numbers at 7:50 p.m. Looking at the 30 minute candle opening at 7:30 when all these numbers start coming out, we see price action of 70+ pips three months ago, while the last 2 months have been less than 20 pips. 3 months ago all 4 numbers came out better than expected, but since then the numbers have been mixed. So watch for all green or all red starting at 7:30 and continuing at 7:50 and maybe this one might return some pips. We close out with the Australian Private Sector Credit m/m number, which has posted sub-20 pip returns for a very long time. Pass.

          USA Session: Finally. we get a number worth watching (and trading). GDP q/q comes out at 8:30 along with Weekly Unemployment Claims and the Preliminary GDP Price Index. Last quarter the Prelim posted a negative number for the first time since mid-Pandemic, and the markets went nuts. We are expecting 3.1% growth this time. If we get anything less (and by less I mean 2% or less) expect fireworks and I don't mean the crappy California "safe and sane" type. I mean D.C., Lincoln Memorial, Bicentennial fireworks (which were pretty awesome if you are too young to remember). Pending Home Sales at 10:00 will probably post its usual 12-15 pip move after release (pass); NatGas at 10:30 and Waller from the Fed is due to speak at some rubber chicken event in Miami at 6:00 p.m. Pasadena.

FRIDAY: Asian/London Session: This last A/L session of August is a mish-mash of numbers from Germany, France, Spain and Italy. CPIs, GDPs, Import Prices, Consumer spending. Here is what it all adds up to: Pass. Pretty much everybody who is anybody in those countries is enjoying their last few vacation days on a beach somewhere (my guess is Greece) before they have to head back to work and start trading for a living next week. The only non-Europe numbers this session are the Consumer Confidence and Housing Starts numbers out of Japan at 1:00 a.m., and coming out independently of one another or at the same time has made no difference. These are sub-20 pip numbers. Pass. And finally, at 8:30 a.m. Canada drops their own GDP number, which fails to generate much price action and is therefore a Pass.

          USA Session: At 8:30 we have 5 different numbers but the only one that matters is the Core PCE Price Index m/m, which is said to be the Fed's favorite inflation measuring tool, a claim looked at askance by traders as it has flashed substantially lower inflation numbers for several months in a row while the Fed ignored it and kept rates higher than what many of us thought was prudent. No matter. According to his statement in Wyoming yesterday Powell is leaning towards a rate cut in September based upon a "curious kind of balance" in the employment market, whatever hell that means. Again, no matter. Expect the market to react to this number if it comes out even just 1 tick higher or lower than the expected .3%. If it lands on the number (and honestly, that is the usual outcome) we might still see a lot of price action as traders eliminate inflation from the list of items that might change Powell's mind at the last minute. After the PCE we have Chicago PMI at 9:45 a.m. (no one cares) and the Revised UofM Consumer Sentiment and Inflation Expectations numbers. The Prelim numbers from a couple of weeks back tend to drive price more often than these re-runs, so don't expect much and you won't be disappointed.

And that's (hopefully) the end of the Summer Doldrums news reports, and again (hopefully) we will start seeing a return to normalcy in terms of trading volatility and momentum beginning next week.

See you then.

Jeff