Hi Folks.
Here is this week's forecast.
SUNDAY: Nothing. Enjoy the time off.
MONDAY: Asian/London Session: In a rather surprising turn of events, we have no early A/L session news to make fun of. The first calendar entry is Great Britain's BRC Retail Sales Monitor y/y number at 7:01 p.m. my time, and the rule that says if the number drops while the country is asleep you can safely ignore the number is certainly the case here. I doubt any traders in London are staying up until midnight:01 to trade this one. Pass. And you can safely Pass on the rest of the evening's output as none of it has any kind of history that makes trading those numbers a good idea.
USA Session: We start at "tentative" (meaning automatic PASS) with the Cleveland Fed Inflation Expectations number, which should have a fixed date and time scheduled for release but still shows up randomly on the calendar as Tentative, so not much we can do with it (but if you are at all curious it's a quarterly number that the last three releases have dropped at 9:35, 9:45 and 9:45 a.m. eastern time...and price action on the USD pairs and the Futures Indices has been muted at best). That leaves us with Existing Homes Sales at 10:00 a.m. my time which is another in a long line of Real Estate numbers that just doesn't have any impact on prices, or at least enough to justify the risk of taking a trade around that number. Pass.
TUESDAY: Asian/London Session: The first of three consecutive days where we have a ton of entries on calendar (quantity) but few, if any, are designed to move prices in any significant manner (quality, or lack thereof). The morning session is mostly those EU-country specific numbers (like German Final CPI and Italian Industrial Production) which traders just ignore outright. The evening session isn't any better, but FF recently downgraded the Australian Wage Price Index q/q number to Beige Folder status. Taking a quick look at how the AUD reacted the last 3 times this number dropped (7, 7, and 9 pips) seems to justify the downgrade. Just a boring session with nothing on tap designed to excite traders or the charts.
USA Session: We start a rather busy session with Fed Speak at 3:15 a.m. (Williams is speaking at some Swiss confab). You don't have to pass because if you're a US based traders you're hopefully sleeping like a baby right now. At 6:00 a.m. (and yes, I double-checked the time) we get that NFIB Small Business Index number, and the same rule from Monday applies. If the source country is asleep when the number drops, Pass. So Pass. At 8:15 we get that Weekly ADP Employment Number, which is universally ignored by traders, so Pass, and then at 8:30, deep into a day full of worthless numbers, we get the CPI m/m, causing us to forget all that stupid stuff from early and to quickly put on our robes in observance of one of the 3 High Holy Days of Trading (NFP, CPI and the Fed Interest Rate Decision). You can make more in the half hour after this number drops than you'll likely make all the rest of the week on all the other upcoming numbers. So don't miss this one. Then after the CPI, there isn't much to work with number-wise. But Warsh, Donald Trump's pick to lead the Fed now that Powell's term has expired, has his Confirmation vote in the Senate this morning/early afternoon. He is likely going to win confirmation, but if anything happens to derail the vote you could see major fireworks. So keep an eye on C-SPAN or some other channel that is tracking the vote so you know what to expect today.
WEDNESDAY: Asian/London Session: I really should just copy and paste Tuesday's analysis and save myself some time. Another long list of EU-country specific numbers no one cares about, and even the EU's own Flash Employment Change and Flash GDP q/q numbers at 5:00 a.m. my time rarely generate more than 10 pips, so it's just another sorry session of garbage numbers and reports you can't trade. And that's both morning and evening session.
USA Session: And it's not a whole lot better in the US portion, except we do get the PPI numbers at 8:30 a.m. But if you've been following the CPI/PPI numbers for a while you already know traders blow up the charts for CPI, but when PPI drops later on (usually a day or two, or three), the response on the charts is not all that impressive. We've even seen the CPI land on target and move things around 50 pips (or points) and the next day the PPI misses by a mile and you're hard pressed to squeeze 20 out of the markets. So it's worth watching (and trading) but go in with managed expectations leaning towards a smaller gain than yesterday's number. After the PPI it's Crude Oil at 10:30, Fed Speak at 11:30, the 30 year Bond Auction at 1:01 p.m. followed by more Fed Speak at 1:15. And that's the day in a nutshell.
THURSDAY: Asian/London Session: The Swiss, French, German, Spanish and Italian banks are closed for Ascension Day today, so don't expect much by way of volume during the morning half of the session. Great Britain seems to be open for business which is good, because they drop their GDP m/m number, along with 7 other numbers that do not matter. GDP will either drive price action at 2:00 a.m., or the missing volume from the missing regions closed today will mute the entire chart. 23. 20, and 18 pips are the last 3 GBPUSD results, and while the 18 is a bit under my 20 Pip Line, I'll give them a pass this time because earlier numbers easily cleared the bar. And the 2:00 a.m. GBP numbers tend to out-perform most of the rest of the Red Folder numbers during the A/L session, so it's still worth a look. The evening session is some random Japanese and New Zealand numbers which can be safely ignored.
USA Session: 8:30 a.m. starts us off with Retail Sales, along with Weekly Unemployment and Import Prices. Retail Sales used to be a bigger deal for US traders but lately just hasn't been enough to create a lot of price action. So adding it in with Unemployment and Import Prices likely won't improve your chances of finding decent trades. But this is one of those weeks where we don't have a whole lot else to work with in any session, so at least be ready to trade the 8:30 numbers, but go in with extremely low expectations. The remaining US session is a combination of numbers designed to be ignored by traders and Fed Speak. So today it's Retail Sales or nothing.
FRIDAY: Asian/London Session: Japanese Machine Tool Orders y/y (which normally generates 10-13 pips of movement on the JPY pairs) and the ECB Economic Bulletin (a report, not a number) and then three different CAD numbers that don't even move the CAD pairs around, much less anything else, are all you have to work with today. This is a perfect day for A/L session traders to take a day off and enjoy a three day weekend.
USA Session: We get the stellar combo of Empire State Manufacturing Index at 8:30 a.m., followed by the Capacity Utilization and Industrial Production numbers at 9:15 a.m. (I'm ignoring the floating Treasury Currency Report which may or may not even make an appearance today). You know that three day holiday advice I gave the A/L session traders just above? The same applies here. In spite of actual entries on the calendar, this is the functional equivalent of a "no news" day, so a long weekend strikes me as a good idea for US traders as well.
See you back here next week.
Jeff
