Forex News Trading Events For The Week of December 1st – 5th

I’ve put together some analysis of this week’s Forex news events, which I hope will give everyone a good understanding of how I’m viewing the market for this week.

This week’s “high impact” news event that I will be looking to trade is as follows;

Thursday 4th December 2014

EUR – ECB Press conference – 01:30pm

We know that the ECB aren’t going to adjust rates as there is little capacity to adjust rates and the ECB have stated that they will not adjust rates further for the foreseeable future. Therefore the markets focal point is whether the ECB will introduce further stimulus measures i.e. quantitative easing, we know that the ECB are already running an ABS programme but the market remains unconvinced that this is enough to get the economy going.

As with most of the risk events that I post I will be looking at the market expectations prior to the event, this week for example the market has an outside bet that the ECB will announce QE. On account of this as long as you have researched prior to the event so that you have that confidence and conviction prior to taking a position you can look to enter a trade prior to the event.

If the ECB do announce QE we can expect the Euro to sell off massively, I would expect the currency to fall down to 1.20 against the Dollar, if they don’t we could potentially see a relief rally to 1.25 and possibly even 1.255, if it does rally to these levels however as per my previous posts, look for the market to sell it off.

The other possibility is that we will simply get dovish commentary from the ECB i.e. they make reference to QE becoming increasingly feasible in which case the Euro will also sell off, even if we get no mention of QE and essentially this turns out to be a non event I would expect the EUR to experience a relief rally but again fundamentally the Euro is going to continue devaluing so we want to sell into any of those rallies.

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