Previous Story
Week Ahead – 14 June 2015
THE WEEK AHEAD FUNDAMENTALLY – KEY DATA TO WATCH OUT FOR
Last week was in the main Greek saga as rumours were quickly dispelled by counter rumours. The G7 meeting had very little affect on currencies.
This week is more interesting as we await the FOMC Statement and press conference as well as a series of Eurogroup Meetings.
COT data (see below) for our currencies has also thrown up a number of notable extremes.
► USD: Tuesday sees the release of Building Permits which is anticipated to show that 1.11M permits were issued.
Wednesday is interesting. We start with the FOMC Economic Projections. This only happens four times every year so is highly anticipated. This is followed by the much awaited FOMC Statement and then the Fed Funds Rate decision which is expected to be unchanged at 0.25%.
On Thursday we have CPI expected at 0.5% and Core CPI at 0.2%. Core CPI excludes food and energy. The CPI figure is therefore the one to concentrate on. The Philly FED Manufacturing Index is expected to be 8.1. We also have the usual Unemployment Claims number estimated at 278,000.
COT data shows that the large commercials again slightly increased their net short position from -73,188 contracts to -76,035. We are not yet at the biggest 52 week rolling net short position which stands at 100,818 achieved on 17/5/15 but we are inching up there. INCREASINGLY BEARISH.
► EURO: An interesting week for the Euro starting on Monday when ECB President Draghi speaks when he testifies on monetary policy before the European Parliament’s Economic and Monetary Affairs Committee, in Brussels.
On Tuesday we have the European Court of Justice Ruling on the constitutionality of the ECB’s Outright Monetary Transactions policy (OMT). Expected to be ratified. We also have German Economic Sentiment data expected to be 37.5 a fall from the previous month’s 41.9.
On Thursday we have EURO LTRO which measures the total value of money the ECB will create and use to loan to Eurozone banks and the Eurogroup Meetings at which Greece heads the agenda.
COT data shows that large commercials decreased their net long position from last week’s 207,136 to 176,715. CONTINUED NEUTRAL.
► GBP: GBP data starts on Tuesday with CPI expected at 0.1%.
Wednesday sees the release of the Average Earnings Index at 2.5%, the Claimant Count Change anticipated to show a drop of 12,500 and the MPC Official Bank Rate Votes thought to be 0-0-9. No member voting for a decrease or hike and all voting for rates to remain the same.
On Thursday we have Retail Sales which is anticipated to show no growth at 0%.
Last week the Rating Agency put UK debt on watch. This is the only agency not to have cut the UK. Moody and Fitch have already done so.
COT data shows large commercials increasing their net long position from 28,514 to 30,440. NEUTRAL WITH A SLIGHT BULLISH BIAS.
► YEN: Three data points of note for the YEN.
On Tuesday we have the Trade Balance number estimated at -0.17T.
On Thursday we have the BOJ Monetary Policy Statement.
On Friday we have the BOJ Press Conference.
Of most importance is the COT data which shows that large commercials increased their net long position in the YEN by a huge 33,631 contracts from 140,846 to 174,477. This is now the highest it has been for the last 52 weeks and is therefore VERY BULLISH.
► AUD:Only one item of note for the AUD which is the release of the Monetary Policy Meeting Minutes on Monday.
COT data continues to remain bullish as large commercials increased their net long position from 33,511 to 34,010. CONTINUED BULLISH.
►CNY:There no no data of note for the CNY this week.
There is no COT data for the CNY.
OUR VIEW: This week will be driven by both the FED with its announcements as well as the ECB.
Importantly we continue to witness the large commercial community reduce their USD exposure. Interestingly the biggest beneficiary currencies are the commodity backed currencies and the YEN.
This bodes well for commodities, emerging markets and negatively for first world risk.
Stay nimble. Good luck trading.
CHECK OUR INTERACTIVE ECONOMIC CALENDAR FOR FULL LIST OF UPCOMING DATA RELEASES
DISCLAIMERThe information contained in this publication is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Users acknowledge and agree to the fact that, by its very nature, any investment in CFDs and similar and assimilated products is characterised by a certain degree of uncertainty and that, consequently, any investment of this nature involves risks for which the user is solely responsible and liable.
Any recommendation, opinion or advice contained in such material reflects the views of TFF, and TFF expressly disclaims any responsibility for any decisions or for the suitability of any security or transaction based on it. Specifically, any decisions you may make to buy, sell or hold a security based on such research will be entirely your own and not in any way deemed to be endorsed or influenced by or attributed to TFF.
Past performance should not be seen as an indication of future performance. Market and exchange rate movements may cause the value of your investment to rise or fall and an investor may not get back the amount invested.
Investors considering opening a self-trading account or investing in the TFF Capital Pool, should limit their exposure to maximum 10% of their investment capital.Eligibility for participation in the capital pool is subject to final determination and acceptance by TFF.
Investments are not obligations of, deposits in, insured or guaranteed by TFF.
