Hi Folks.
Here is this week's forecast.
SUNDAY: An unusual entry to start the week off, with a "tentative" Fed Speak listing for Barkin. Normally they at least give us the time associated with the speech or talk or whatever, but not now. Fortunately we don't trade Fed Speak entries so ignore this one. You can also ignore the two Japanese entries at 7:50 p.m. my time (Bank Lending y/y and Current Account). Neither generate any noteworthy activity on the JPY charts.
MONDAY: Asian/London Session: A lot of entries today, but none of them carry any sort of weight. We have some Brit Fed Speak set for 6:30 a.m., 8:50 a.m. and noon, my time. Not tradeable but for GBP traders they could screw things up for you rather nicely so be aware these entries are out there. At 7 p.m. the BOJ releases their Summary of Opinions, which relates back to their last Interest Rate decision. Also not tradeable but worth reading if you are trading a lot of JPY charts.
USA Session: Fed Speak at 10:25 a.m. (Kugler), Federal Budget Balance at 2:00 p.m. (shocking as I had no idea we even had a budget), and a floating Cleveland Fed Inflation Expectations number. This last one sort of pisses me off. They know what the number is, or at least they should by this point, and they can't be troubled to set a specific time for release. So why even bother? And as it turns out, no one trades this one any more than they do the Conference Board version, which is a total waste of electrons. But it's on the calendar so I feel compelled to at least mention it.
TUESDAY: Asian/London Session: 2:00 a.m. brings us the GBP Claimant Count Change (British Unemployment Number). The last 3 months has seen a 17-27 pip move based off this number, which makes it tradeable, and more so if the number ends up missing by a wide margin. The dates where they forecast 10k and post 20k seem to give you the best shot at a 20+ pip trade. Most of the rest of the session is junk...however, the Beige Folder German ZEW Economic Sentiment number has landed at the same time the EURUSD has posted 20+ pip moves the last couple of times this number has dropped, which is just over the line in terms of what I consider tradeable. No guarantee it will do the same this week, and for the last several months it hasn't really been worth our time. But these numbers can and do "wake up" for a period of time and I suspect this may be one of those times. So at least be ready at 5:00 a.m. when it drops. We also have Bailey from the Brit Fed speaking at 11:00 a.m. and he's the UK's version of Jerome Powell, so again, at least pay attention to the clock and know he's lurking around out there if you are trading the GBP in any capacity. As for that Aussie Red Folder Wage Price Index q/q number, that one is a great report to trade if some of your other hobbies include watching paint dry and grass grow. The last three reports generated 10 pips or less in the 60 minutes after release. Why the delusionals at FF think this is Red Folder is beyond me. Pass.
USA Session: Three reports on calendar today, two of which you can safely ignore (NFIB Small Business Index at 6:00 a.m. and the recently added API Weekly Statistical Bulletin at 4:30 p.m.). The one to watch is CPI and its various iterations at 8:30 a.m. CPI has become one of the High Holy Days of trading and pretty much across the board, whatever chart you are trading, you'll see some action. The forecast is once again for .3% for both Core and Overall, but recent inflation-based numbers have been missing to the downside rather significantly, meaning inflation is disappearing from the US economy. Certainly food and gas prices have been dropping significantly over the last 3 months (I wonder what event happened in January that would be the causation behind all this???) So do not be surprised when the CPI comes in lower than expected, adding to the already significant pressure on Powell and the Gang to start cutting interest rates sooner rather than later. It absolutely galls him to have to do so and give President Trump another apparent win, and the Fed does have a sordid and well documented history of acting much too late when it comes to cutting rates, so this might not increase the rate cut pressure as much as it might in other circumstances (such as a different President), but it will be interesting to see what kind of reaction it produces in Fed Land should the numbers come out close to zero once again.
WEDNESDAY: Asian/London Session: Just not much to work with today at all in either session, morning or evening. The head of the German Buba (Nagel) speaks at 4:15 a.m., and he's like a second tier Powell, so just be aware he's out there. And the FF Red Folder AUD Employment Change numbers have failed to generate more than 10 pips for the last few months so again, the Red Folder designation and Reality are entirely separate things.
USA Session: Crude Oil at 10:30 and Fed Speak at 5:45. And you may have noticed no PPI entry today, one day after the CPI release. Odd. But don't worry, it's on the horizon.
THURSDAY: Asian/London Session: 2:00 a.m. brings us 8 GBP reports, only one of which matters: GDP m/m. This one has been a little schizo, sometimes knocking out 30+ pip moves and other times less than 10. It all depends on how close (or far away) the actual number lands compared to the forecast. The further away they are from each other the higher the probability of seeing a 30+ pip move. And of the remaining 20+ calendar entries, none of them are even worth mentioning.
USA Session: After the unexpected delay, 8:30 brings us PPI. And Retail Sales. And Weekly Unemployment Claims. And both the Philly Fed AND Empire State Manufacturing Indexes. It is a wealth of numbers and honestly, if we don't see some sort of price action starting at 8:30:00, we might as well hang it up for the day. One of those numbers is going to make prices go zoom this morning. We just don't know which one (or ones) it will be. Just be ready. And if having a week's worth of Red Folder numbers drop t 8:30 isn't enough for you, don't worry. At 8:40 a.m. Powell from the Fed is giving the opening remarks at some conference in D.C. Nothing in the calendar about audience questions, so this might not be a major chaser to our 8:30 lineup of shots. The rest of the session is a collection of garbage numbers that never do anything, so it's all about 8:30 this morning (and the carryover at 9:30 when the Index markets all open).
FRIDAY: Asian/London Session: Yet again a short list of Yellow Folder trash designed to lull you to sleep rather than give you anything to look forward to in terms of news-based price action. FF mentions that Schlegel, the Swiss Fed Chie, speaks at 7 a.m. my time. He's more like a third tier speaker so the fact he gets a Beige Folder mention is a little surprising. But the rest of the session is a snooze.
USA Session: An active morning from a "number of reports" standpoint, but the reports themselves aren't anything special. Once again the University of Michigan numbers (Preliminary Consumer Sentiment and Inflation Expectations) dropping at 10:00 a.m. get Red Folder status on FF. Every once in a while you see some decent price action when these numbers drop, but it is by no means a guarantee (like we get with CPI and NFP). But given the rest of the session is Fed Speak and trash numbers, this one might be all traders really have to hang their hats on for the day. So if you want to be trading in the late morning on a Friday, these are the numbers you'll want to watch. Otherwise it should be a quiet day, notwithstanding any surprise socio-political events that pop up unannounced.
Have a great weekend and I'll see you back here next week.
Jeff
