Hi Folks.
Here is this week's forecast, and with a couple of decent numbers due to drop it should make for a much better week than last week.
Should.
SUNDAY: Two Aussie numbers, both dropping at 7:30 p.m. eastern time: ANZ Job Advertisements m/m and Household Spending m/m. Neither will cause the AUD pairs to move much at all, so an easy Pass to start the week.
MONDAY: Asian/London Session: As I mentioned in the beginning, there are a couple of decent numbers on tap this week that should help create some decent trading conditions. Unfortunately, none of those numbers are present today, or tonight. 7 calendar entries for both sessions and if collectively they create 20 pips of movement between them it will be a miracle of biblical proportions. So if you decide to skip trading today and settle on Tuesday, I would consider that wise.
USA Session: And it's absolutely no better for the US session. Fed Speak at 12:45 and 6:00 p.m. and that 10 year bond auction is all we have to work with today. A huge PASS all the way across the board.
TUESDAY: Asian/London Session: Today/tonight, frankly, are no better than yesterday during the A/L session. The Japanese Economy Watcher's Sentiment number at midnight is always a hard pass, as is the French Budget Balance at 2:45 a.m. The 8:30 a.m. Canadian Building Permits number rarely registers a blip on the charts, so it too can be ignored, and the three evening numbers (New Zealand Building Consents at 4:45 p.m. and ANZ Commodity Prices m/m at 7:00 p.m., with Japan's M2 Money Stock y/y ay 6:50 p.m.) can all be safely Passed as well.
USA Session: Here is where it gets exponentially better (I hope). We lead off at 6:00 a.m. with that NFIB Small Business Index number...we're all still asleep around here when it drops so we can safely pass on crawling out of bed early for that one, and that recently added ADP Weekly Employment Change number is once again listed as "tentative" which makes it an automatic pass (but the last 4 numbers dropped precisely at 8:15 a.m., so the tentative listing is a bit confusing...probably a tempest in a teapot because the numbers have failed to move charts around regardless of the time they appear). But now with the appetizers cleared away, we get to the main course: the CPI numbers (Core, Overall and y/y). Last Friday we finally got a current NFP number and the charts remained active for hours. Today we get the most recent CPI (from December) and I expect more of the same, regardless of where the number lands in relation to the expectation. Just be ready to trade at 8:30 when the number drops and 9:30 when the futures/stock markets all open. This should turn out to be a very good trading day. After CPI though, it goes pretty steadily downhill. New Home Sales at 10:00 (along with some Fed Speak AND a delayed New Home Sales number from September). Nobody trades any of that so Pass. Then in fairly quick succession we get that "tentative" RCM/TIPP Economic Optimism report (tentative=not tradeable); the 30 year bond Auction at 1:01 p.m., Federal Budget Balance at 2:00 (which I still think we don't even have in place yet), more Fed Speak at 4:00 p.m. and finally that weekly API Oil Report at 4:30. None of the data due for release AFTER the CPI is likely to do anything at all. See be ready to make some moves starting at 8:30 because by noon it should be quieting down significantly.
WEDNESDAY: Asian/London Session: Third session in a row that makes me question why I even bother with these numbers. 4 events in the calendar for the early half: Japanese Preliminary Machine Tool Orders at 1:00 a.m., British Fed Speak at 3:00 and a pair of Tentative Bond Auctions listed out of GB and the Eurozone. At 10:30 we get more British Fed Speak, and close out the session with Japanese PPI at 6:50 p.m., Australian Melbourne Institute Inflation Expectations at 7:00 and a RICS House Price Balance out of Great Britain at 7:01 p.m. (midnight:01 local time). Not a single one of those will cause even a tiny move on any of the charts as far as I can tell (from past history).
USA Session: Round Two of decent numbers drops at 8:30 with both PPI (Core and Overall) and Retail Sales (Core and Overall) set to drop at the same time. If you've read these reports for a while you should already know that when CPI drops first, market reaction to PPI at a later date (even the day after) tends to be muted. But today we get both PPI and Retail Sales at the same time...an unusual pairing...so even though everyone made bank yesterday (right???) I think today we might get a second bite at the apple with both PPI and Sales hitting at the same time. Maybe it's wishful thinking on my part after about six straight months of dumpster fire trading, but what do we have if we don't have hope? Unfortunately, much like yesterday, after the 8:30 numbers drop (including a straggling PPI number from October), things again go downhill fast. Business Inventories and Existing Home Sales at 10:00, Crude Oil at 10:30, and Beige Book at 2:00. Aside from the Oil number (for Oil traders) there is nothing to work with here. And that goes double for all the Fed Speak that litters the calendar at 9:50, 10:00, 12:00, and 2:10 p.m.
THURSDAY: Asian/London Session: We finally get a little something to work with in this session, with British GDP m/m set to drop at 2:00 a.m. (along with a half dozen other numbers that we would otherwise ignore if they were standalone releases). The GB GDP used to be a 30+ pip number, but recently had shown signs of falling out of red folder worthiness, with numbers of 14, 28 and 19. I'm still saying it's worth watching right now because of the last two numbers (28 and 19) simply because we have absolutely nothing else to work with during this session this week. So I am expecting a somewhat bigger response to the number than what we might ordinarily see. But after the GB GDP, things take the rocket sled downhill. The morning numbers are trash and in the evening all we have to work with is a pair of New Zealand numbers (BusinessNZ Manufacturing Index at 4:30 and the Food Price Index at 4:45 p.m.). Neither of those have any decent history to justify taking a trade so Pass on both of them.
USA Session: So after two days of legitimate Red Folder numbers to start with, we get a palate cleanser today with a calendar full of entries designed to do nothing at all. FF still lists Weekly Unemployment as a red folder, but it hasn't done much for us since 2024 when the Fed pivoted away from inflation and back towards employment for a brief spell. FF also beiged the Empire State Manufacturing Index and Philly Fed Manufacturing Index folders, but neither on their own has proven to be worthy of such elevated status. Perhaps, and this is only a perhaps, because we've gone through such a drought of decent trading lately, this grouping could produce above its head a little, but it's not something I'm counting on seeing. We also have Import prices at 8:30 but no one cares, nor do they care about the October Import prices number due to drop at the same time (maybe). But much like the A/L session, after we get past the 8:30 session it's all downhill. Fed Speak at 8:35, NatGas at 10:30, more Fed Speak at 12:40, and that TIC Long Term Bond Purchases number lands at 4:00 p.m. after everyone should be done with trading for the day. So today brings with it the possibility of some decent trading, but that possibility should be considered slight at best.
FRIDAY: Asian/London Session: Luckily for A/L traders we had that GB GDP number yesterday. Otherwise we'd have five straight days of dumpster fire numbers. 2:00 a.m. is the German Final CPI, 8:15 Canadian Housing Starts, 8:30 Canadian Foreign Securities Purchases, 9:30 is Great Britain's Conference Board Leading Index and 10:00 a.m. is Australia's very own Conference Board Leading Index numbers. All trash and all Passed.
USA Session: And after a week where we got all the red folder news out of the way over two earlier days, we get the same level of garbage numbers the A/L session has enjoyed pretty much all week. 9:15 is the Siamese twin pairing of Capacity Utilization and Industrial Production, and if these two never showed up ever again I doubt anyone would notice. Pass. Then we get the National Association of Home Builder's very own Housing Market Index, another non-event from the world of housing related numbers. Finally, we close out the day with Fed Speak at 3:00 p.m., and if you're hanging around on a late Friday afternoon to trade Fed Speak, you should seriously consider seeing a doctor and getting some help. Pass.
That's it for the week, and fingers crossed it's a good one for all of us.
Jeff
