Hi Folks.
Welcome to this week's forecast. As I mentioned in the email I sent out mid-week, the U.S. Government failed to reach a budget compromise and as a result has shut down all non-essential services. What that means for us is a serious reduction in the numbers we'll see posted for the US Session this coming week. When they finally all get back on the same page and start releasing numbers again, we will likely see all the various agencies playing catch-up by releasing all the older numbers all at once during the same week, and then things will be back to normal after that. But for now, expect to see a LOT of Fed Speak listed during the US sessions because aside from a couple of University and Private Enterprise groups, there just aren't any numbers to write about.
So here's this week's forecast.
SUNDAY: A sort of typical Sunday evening. Two reports at 8:00 p.m., one each from Australia and New Zealand (MI Inflation Gauge and ANZ Commodity Prices) and neither one moves price around more than a couple of pips. So pass on Sunday evening trading once again.
MONDAY: Asian/London Session: A grand total of 13 entries on the calendar covering the next 24 hours, all of them non-US numbers, and none of them worth looking at with an eye towards finding a news-fueled trade. The only two entries worth noting are the back-to-back Fed Speaks at 1:00 p.m. (LaGarde from the EU testifying before the EU Committee on Economic affairs) and 1:30 p.m. (Bailey from the Bank of England speaking at some Global Investment Summit in Scotland). Can't trade either but both are top-tier Fed Speakers so they have the ability to destroy perfectly good trades with just a glance. So be aware they are out there more or less at the same time.
USA Session: Nothing listed (no surprise, considering.) And be aware that so far FF has been spotty about which reports they list and which ones they take off the calendar entirely. After the shutdown I noticed they took off yesterday's (Thursday) Weekly Unemployment number, but they left the NFP on for today (Friday) but listed as "tentative". It may or may not remain on the calendar after 8:30 a.m. comes and goes. {Friday 8:31 a.m. Update: NFP is now off the calendar entirely} The point is, while the shutdown remains in place, do not trust that a number listed on the calendar for a specific time will in fact get released unless you know for certain the releasing party is a non-government entity.
TUESDAY: Asian/London Session: Almost a Groundhog Day-like repeat from last night, with lots of numbers (14 by my count) and pretty much nothing worth trading. The only point of possible interest is Canada's Ivey PMI at 10:00 a.m., which has managed to either flirt with or break through my 20 pip line of death, which makes it worth a trade. Literally everything else, including the New Zealand Interest Rate decision at 9:00 p.m. my time, has failed to generate enough consistent price action to make their releases trade worthy. We do have Nagel from the German Buba and Ueda from the Bank of Japan speaking at 12 noon and "tentatively" (respectively) so be aware both of these top-tier Fed Speakers are out there looking for ways to ruin your trades. Be careful.
USA Session: A few numbers listed. but I don't know for how long. Trade Balance at 8:30 a.m. is a product of the Bureau of Economic Analysis, a US Government Agency, so don't expect to see this one show up barring the end of the shutdown. That TCM/TIPP Economic Optimism report is listed as tentative, but it's always listed as "tentative" because they don't care enough to turn it loose at the same time every month. So it's a Pass as usual. There is also a Consumer Credit number due out at 3:00 p.m., but this is a Federal Reserve number, and the Fed is but is not a US Government Agency (they are when it suits them and are not when it does not). Regardless, no one cares about the Consumer Credit number at 3:00 p.m. so don't bother with it. We also get that API Weekly Oil Bulletin after the oil markets are done for the day at 4:30 p.m. The rest of the calendar is Fed Speak from all the lesser members, at 10:00 a.m., 10:05 a.m., 10:30 a.m., and 11:30 a.m.
WEDNESDAY: Asian/London Session: The first two numbers of the session (Japanese Economy Watchers at 1:00 a.m. and German Industrial Production at 2:00 a.m.) are both filler numbers and don't generate enough price action to be worth the risk of trading. At 5:30 a.m. the Brits release their Financial Policy Committee Meeting Minutes and a Statement. Neither are numbers but both could have an impact on price action as both are designed to give hints about the direction the British Fed plans to take at their next Interest Rate Decision meeting. There is some lesser British Fed Speak at 11:00 a.m., followed by their RICS Housing Price Balance at 7:01 p.m. (midnight:01 in the UK so you can safely ignore this number like the Brits do, seeing as they are mostly asleep by then). Australia closes out the session with another universally ignored number, the MI Inflation Expectations number at 8:00 p.m. Pass.
USA Session: Currently the calendar lists Construction Spending as "tentative" meaning they aren't expecting to see the number at all, and Crude Oil at 10:30 a.m. The Crude number is put out by the Energy Information Administration, whose website ends in .gov, meaning a government agency as well. I am hearing rumors that some parts of the government got their funding approved when the Big Beautiful Bill was passed some months ago, and it makes sense that the Energy departments would be the beneficiaries of that, given the focus this President puts on energy, but we will just have to wait and see what happens here. I should point out that last week, the Government shutdown was at midnight on September 30th and the Crude Oil number was released at 10:30 a.m. the next day. This may have been because the number was already prepared and ready for release prior to the shutdown. But again, we will need to take a wait and see approach to this one. There is also a 10 year Bond Auction set for 1:01 p.m. and I am guessing this one will go forward as planned, since collecting money, either through taxes or bond sales, is probably considered an essential government operation. Then at 2:00 p.m. we get the meeting minutes from the last Fed Meeting. Not a number but a report, and one that can roil the markets depending on its contents. So be aware if you are still trying to find a trade at 2:00 p.m. on a Wednesday. Then we have Fed Speak at 9:20 a.m., 9:30 a.m., 3:15 p.m., and 5:45 p.m.
THURSDAY: Asian/London Session: Another Groundhog day-like start to the session with a pair of 2:00 a.m. numbers (German Trade balance and Japanese Preliminary Machine Tool Orders) that will do nothing for price action, so pass. 7:30 a.m. brings the ECB's Monetary Policy Meeting Accounts (notes from their last Rate Decision Meeting) which isn't a number but might cause at least a small bump in price action. Fed Speak at 4:30 a.m., 8:00 a.m., and 9:00 p.m., this last one being Bullock from the Australian Fed, so this one could do some late night damage. At 5:30 p.m. New Zealand releases their Business Manufacturing Index but no one will be trading it, and at 7:50 p.m. we get our last two numbers of the night from Japan, Bank Lending and PPI y/y. Neither move the Yen at all so both of these combine into one big Pass.
USA Session: At 8:30 the FF computer lists the Weekly Unemployment number, followed by a "tentative" listing for the Weekly Unemployment Number. This one won't be making an appearance barring the end of the Shutdown, so don't worry if it ends up being removed by the time Thursday gets here. We also have US Fed Chief Powell set to speak at 8:30 so be aware he's out there as well. At 10:00 we have both a listing for Final Wholesale Inventories and a "tentative" listing for Factory Orders. Both come from the Census Bureau, making them gubmint numbers not likely to see the light of day. So again, if they are off the calendar by the time you take a look Thursday morning, this is why. NatGas at 10:30 a.m. is in the same boat as Crude Oil from yesterday: maybe yes, maybe no. If the Crude number gets released, then this one will as well. And the 1:01 p.m. 30 Year Bond Auction will get the same treatment: if the 10 Year Bond Auction yesterday shows an entry, then this one will as well. If the 10 Year is disappeared down the memory hole, this one is a non-starter as well. We close with all the other Fed Speak (aside from Powell) at 8:35 a.m., 1:00 p.m., 3:45 p.m., and 9:40 p.m.
FRIDAY: Asian/London Session: The Swiss Seco Consumer Climate number at 3:00 a.m. and the Italian Industrial Production m/m number at 4:00 a.m. have no history of making things happen, so pass. But at 8:30 a.m. we get the Canadian Non Farm Payroll (they don't exactly call it that but that's what it is for our purposes) and this is a High Holy Day for Loonie Traders. Lots of decent moves off this one, ranging from 20 to 60 pips, so definitely the one you want to be watching this week.
USA Session: We get the Preliminary UofM Consumer Sentiment and Inflation Expectation numbers at 10:00 a.m., and while we have been seeing some decent price action off these numbers over the last few months, should the shutdown remain in effect through today, I'm thinking we might see NFP/Fed Rate Cut-like price action as a result. There hasn't been a decent number to work with for the last 5 days and traders may be feeling like this is their one and only shot at making something happen this week. So if you do nothing else all week, tune in for this one. It may make the otherwise lousy week worthwhile. At 3:00 p.m. we get the Federal Budget Balance number, ironic because the Government is shut down because they have no budget, but this is a Treasury Department number, so it may or may not show up, depending on how vital the bean counters are considered within the four walls of Treasury. And honestly it probably won't matter because it's 3 p.m. on a Friday and if the G is still closed, no one with any common sense will still be trading. Oh, and we get one lesser Fed Speak at 1:00 p.m.
And that closes out a most unusual week of news. See you back here next week and I hope we have returned to normal by then.
Jeff
