Hi Folks.
By the time you read this, the US and Canada will have made the switch from Standard Time to Daylight Savings Time. What this means for the rest of the trading world is that if you trade the US-based charts (Indices, Gold, Oil, USD-linked Forex charts) all the related institutions will open an hour later than normal. Or is it an hour earlier? Don’t listen to me on this topic. Time change has been a mystery for me ever since I learned to tell time in the early 1960s. Instead, go to Google and ask “what time is it right now in New York City?” This will help you decide if you need to turn your platform on an hour earlier or an hour later.
As for the calendar this week, it’s once again a pretty sorry collection of numbers that most traders will ignore (aside from a couple of obvious ones I’ll get to in a minute). So once again this is going to be a quick version of the Forecast because I’m running out of inventive ways to keep saying “this sucks”.
Oh yeah, and there is still a war of some sort going on in Iran. It was in the papers. Perhaps you read about it. That’s this week’s wildcard, and likely to blame for everything bad that happens to us as traders this week.
So let’s get to it.
SUNDAY: Just like last week, there are a handful of Japanese numbers at 7:30 and 7:50 p.m. that traders universally ignore. Follow their lead on this one. Pass.
MONDAY: Asian/London Session: There are 14 calendar entries for the A/L session, equally divided into the morning and evening sessions, and every single one of them is trash. Nothing in the entire group worth mentioning. So one big PASS for both sessions.
USA Session: No news today. Not even a random Fed Speak entry. So don’t expect much.
TUESDAY: Asian/London Session: Groundhog Day except today you only need to ignore 5 calendar entries designed to do absolutely nothing to inspire traders. Another full session PASS.
USA Session: The good news: Today is much better than yesterday because we have 4 calendar entries. The bad news: We have THESE four calendar entries: That NFIB Small Business Index that drops at 6:30 a.m. my time and no one reads or trades because we're all still in bed, especially today with the time change having recently taken effect; that 8:15 a.m. ADP Weekly Unemployment number which so far has had zero impact on any of the charts after about 4-5 full months of being featured in the calendar; the 10:00 a.m. National Association of Realtors Existing Home Sales number, ignored by traders ever since the head of that org admitted after the real estate meltdown in 2008-2010 that they made up all the numbers and any resemblance to real numbers was both accidental and coincidental; and finally at 4:30 p.m. that API Oil report that comes out the day before the oil number drops and no one reads. So much for having numbers today. PASS x 4.
WEDNESDAY: Asian/London Session: Day Three where every single number, morning and evening, is garbage and not worth worrying about.
USA Session: Finally, we get at least one number today worth trading, and that is the CPI at 8:30 a.m. (both Core and Overall) along with the Annual number. The expectations are in the .2-.3% for the m/m and 2.5% for the y/y. These are the targets the Fed aimed at for the last two decades, usually with some degree of success. So we’ll see how they pan out today. But even if the actuals hit the bullseye, we’ll still see some decent price swings at 8:30 when they drop and again at 9:30 when the Futures markets open. The rest of the day is just filler. It’s all about the CPI today.
THURSDAY: Asian/London Session: Yet another wasted day full of non-impact numbers, although at 5:30 a.m. my time Bailey from the Bank of England is set to speak at some shindig in London, where local time will either be 9:30 or 10:30 a.m. It doesn’t matter. It’s too late for breakfast and too early for lunch, so expect him to speak and run. And I told you I was terrible with this time change stuff. But you didn’t believe me, did you?
USA Session: Unemployment at 8:30, which has amounted to exactly ZERO in terms of price action anywhere for several months now (there are some other reports dropping at 8:30 as well but they are all delayed again so no one will be paying attention). NatGas at 10:30, Fed Speak at 11:00, and a 30 year Bond Auction at 1:01p.m. None of it is worth getting out of bed for.
FRIDAY: Asian/London Session: We get one of those numberpaloozas out of Great Britain today at 3:00 my time (and 7:00 a.m. local time if I remember correctly) where they drop 6-10 numbers at once but only one matters, and today that number is the GDP m/m. 3 months ago it landed in the mid teens, but the last two months have hit 20+, so this makes it worth a watch and likely worth a trade. And as is usual in these cases, the nature of the other numbers dropping at the same time does not matter. Just the GDP. And you can safely ignore the rest of the numbers set for the A/L session EXCEPT FOR the Canadian NFP which drops at 8:30. Officially known as the Employment Change/Unemployment Rate combo, this one comes out a week after the US NFP so we aren’t likely to see as big a response as we get when both countries drop their NFP simultaneously. But again, 20+ is sort of the worst you can expect from the Canadian version.
USA Session: The 8:30 numbers are numerous and all have one thing in common: they are 15 days late getting to the table. Normally this would mean less trader interest, but today we get the Core PCE (the Fed’s alleged favorite inflation tool), the Preliminary GDP (one of the most heavily manipulated numbers on any calendar but traders do love them some early GDP numbers), and the Overall and Core Durable Goods Orders (yes, also at 8:30) along with some lesser space fillers. But with all three of these mostly mid-level numbers hitting at the same time, this is the recipe for some price action fireworks, even if they should have been on calendar 2 weeks ago. And if that isn’t enough, at 10:00 a.m. we get the 15 day late JOLTS Job Openings number along with the Preliminary UofM Consumer Sentiment and Inflation Expectations numbers. I’ve mentioned several times before that JOLTS does better when paired with another decent number, and traders do seem to like those Prelim UofM numbers, so I’m guessing we’ll see at least a minor continuation of the 8:30 fireworks show at 10. It’s a shame we had to jam in everything except CPI into a 90 minute period on Friday. This week would have been better had some of Friday dropped on Monday or Tuesday. But these are the cards we were dealt so let’s make the most of them.
That’s it for this week. See you next Sunday.
Jeff
