Q4_Week_50: Market Outlook

Currencies:

The dollar has continued its consolidation, which is quite clearly in a range now on the daily timeframe. Our view is still the same as the last 2 weeks – waiting for the breakout to confirm the bias. We have a lot of fundamentals out over the next few days, especially today with the FED releasing their interest rate decision. Be mindful of this when trading today, that we could see some volatility across the board.  

“Many believe the Fed might already be behind the curve when it comes to controlling inflation and needs to act fast to prevent severe future shocks to the economy. Given the statements we have heard from several officials, including Powell himself, expect the Fed to announce an acceleration of tapering by $30 billion a month, starting in January 2022 so that the program ends by March, allowing the Fed to begin rate hikes earlier than previously anticipated.”

Upcoming fundamental releases we have are: 

Wednesday, December 15th 

• USD, Retail Sales (MoM)(Nov) 
• USD, Retail Sales Control Group (Nov) 
• CAD, BoC Consumer Price Index Core (YoY) (Nov) 
• CAD, BoC’s Governor Macklem speech 
• USD, Fed Interest Rate Decision 
• USD, Fed’s Monetary Policy Statement 
• USD, FOMC Economic Projections 
• USD, FOMC Press Conference 
• NZD, Gross Domestic Product (QoQ) (Q3) 
• NZD, Gross Domestic Product (YoY) (Q3) 
• AUD, RBA’s Governor Lowe speech 

Thursday, December 16th 

• EUR, European Council Meeting 
• AUD, Employment Change s.a.(Nov) 
• AUD, Unemployment Rate s.a.(Nov) 
• EUR, Markit Manufacturing PMI(Dec) PREL   
• EUR, Markit PMI Composite(Dec) PREL   
• CHF, SNB Interest Rate Decision 
• CHF, SNB Monetary Policy Assessment 
• EUR, Markit PMI Composite(Dec) PREL 
• CHF, SNB Press Conference 
• GBP, Markit Services PMI(Dec) PREL 
• GBP, Bank of England Minutes 
• GBP, BoE Asset Purchase Facility 
• GBP, BoE Interest Rate Decision 
• GBP, BoE MPC Vote Rate Cut 
• GBP, BoE MPC Vote Rate Hike 
• GBP, BoE MPC Vote Rate Unchanged 
• GBP, Monetary Policy Summary 
• EUR, ECB Deposit Rate Decision 
• EUR, ECB Interest Rate Decision 
• EUR, ECB Monetary Policy Decision Statement 
• EUR, ECB Press Conference 

USDollar Daily

GBPNZD Daily 

As mentioned over the last couple of weeks we have been watching GBPNZD for a long. We have had a nice reaction from the AOI now and have pushed up a lot. We will be watching this for continued longs, and treat any pullback for a reason to add positions. 

Resource – The Creature from Jekyll Island: A Second Look at the Federal Reserve By G.Edward Griffin 

This is a very interesting book behind the Federal Reserve. The last couple of years have shown us that the FED can print trillions of dollars – but how do they do this? How is this allowed? What does this mean for us? This book should help you understand how the system works. 

This is a long book, but each chapter is packed full of info so you can pick this book and drop it and take your time to digest and finish the book. It is the first book in a while where after 5 minutes I am hooked!