the daily chartist

What's next for the upcoming week on the calendar 05.11 - 09.11

published 1 year ago

Soften start of the new week and month, but ended yet again in badly for the major indexes and stocks after the rumours that Trump ordered to the administration to draft a proposal on an eventual positive outcome of the talks between China were denied by the administration itself and after Apple told that they won't disclose anymore the number on iPhone sales. Apple stocks plunged with 6% on Friday. 

So here are the things that we need to have in mind when we set our trading set up for next week:

Monday we have GBP Service PMI 53.4/53.9 and CAD BOC Gov Poloz speaking before the US session. USD ISM Non-Manufacturing PMI follows after the opening.

On Tuesday we have German Factory Orders -0.4%/2% and German Final Services PMI to remain flat at 53.6/53.6. Euro PPI follows with a forecast of 0.4% vs 0.3%. CAD Building Permits is for the US session 0.3%/0.4%, US JOLTS Jo Openings with no current forecast, but at 7.14M previously. And of course, we have the Congressional Elections or the Midterm elections for a new Senate in the US!

Wednesday will offer us some data from German Industrial Production -0.1%/-0.3%, Euro Retail Sales -0.1%/0.7 and on the US side we have Crude Oil Inventories with no current forecast, but the last time the report showed there is a build of 3.2M barrels. 

Thursday we have German Trade Balance with a forecast of 21.2B vs 18.3B and the Euro Economic Bulletin and Economic Forecasts. Canada Housing Starts 195K vs previously 189K will be the prelude to the US opening and in the session itself, we are going to wait for the Unemployment Claims where previously they were 214K and the forecast is to remain at that number. Later we have FOMC statement, which is going to be without a press conference and the Funds rate, but there won't be a move on the rates as it is expected to be done in December. 

With closing the week on Friday we have GBP GDP 0.1%/0%, Manufacturing Production 0.1%/-0.2% and Prelim GDP 0.4%/0.6%. On the US side, we have PPI 0.3%/0.2%.

That's it for the recap of the most important events that will drive the markets for the next week. Type them, have them in mind and good luck to everyone and have a successful trading week!



Crude Oil in trouble

published 1 year ago
WTI Daily

For Crude everything started with the bearish engulfing bar on 4 October. Fundamentals weighed in on the price with heavy pressure from the sellers. On Sunday Iranian sanctions are going to take an effect so we are going to see an interesting opening for WTI on Monday. I personally think that the market has already priced in the effects, bringing down the price below $70 pb.  Selling has been heavy indeed as the price quickly found its way below the 50 SMA, the first channel line of the uptrend, under 61.8 Fibo and under the 200 SMA. DeMarker also formed a selling signal around the time the engulfing bar was formed. 

First scenario: Price opens with a gap down and depending on how fast it is covered and how much we will have a confirmation that we can begin to short the Crude with a stop loss at $72. In this scenario, the price will go down towards the 200 SMA where we will need to see a final breach and test to confirm that the instrument is going into a Bear market. 

Second scenario: Everything has been priced in already, the sanctions are not a surprise and Oil goes up with a gap on Monday. Price is stabilising for a move up where the market will form a balance between supply and demand and our idea of shorting the commodity will break down.


Sterling shows resilience

published 1 year ago

Cable has played out the double top very well as it was sold under pressure as a result from disappointing news surrounding Brexit talks and the overall USD strength. Even with the recent gains because the news came out that London will remain Europe's financial Gateway, the currency pair is still in a downtrend. The Friday's close shows it as the bar failed to breach the upper line of the channel and the price also closed under the psychological 1.3000. Don't be fooled by DeMarker showing a turn above 0.3 in the oversold zone. This has occurred, because of the sharp impulse after the news. The dollar was also sold heavily on Thursday. The price will test the neckline for sure on its way down and it's going to be a key level. 

First scenario: Sell on Monday opening with a stop loss at 1.32500.

Second scenario: Wait for a test on the neckline and open a short after the breakout and the confirmation. 

Third scenario: Price moves up from the neckline, moving away from the down channel and towards a test for the 50 SMA and an eventual 200 SMA test for early indications that the price will continue on its correction course.

The Yen is again under pressure

published 1 year ago

For the pair, I am still observing an uptrend still in play as the price has returned inside of it after the test on the downtrend line on the 26 October. It was a pure stop hunting and the fake breakout is obvious. The price since then made a strong impulse towards the 50 SMA and closed above it. With breaching 78.6 Fibo on the next day the price made a confirmation for long positions. DeMarker also turned North above the 0.3 line showing that the pair was oversold. The price movement also has formed a double bottom which is currently in play. Unfortunately, on Friday the price did not close above the previous day's high so I think that the price may return a couple of pips down towards the 78.6 Fibo at least before continuing the move up as the dollar gains strength. 

First scenario: you can open long positions with the trend with a stop loss 110.500.

Second scenario: you can wait for the correction down towards a more cheaper level to get in.

Third scenario: The price manages to break through the 78.6 Fibo, the 50 SMA and the downtrend line for a move towards 200 SMA. 

What's next for the upcoming week on the calendar 29.10 - 02.11

published 1 year ago

 We are nearing the end of October and nevertheless, we have a lot of things to keep an eye out on the economics calendar.

Starting off with Monday we have Japan Retail Sales when Asia opens 2.1%/2.7% and during the EU session, we have UK Mortgage Approvals rolling in with a forecast of 65K vs 66K forecast. During the whole day, we have the EU Economic Forecast as tentative so it's a good idea to watch out for that one, we may have some interesting things coming out. With the pre-market following for the US session, we have Core PCE Price Index 0.1%/0.0% and Personal Spending 0.4%/0.3%.

Tuesday starts again with fundamentals from Japan with the Unemployment Rate coming in early Asia opening forecasted to pop at 2.4% from 2.4% previous. Sometime during the EU trading, we are going to anticipate the German Perlim CPI data 0.1%/0.4% and the German Unemployment Change -12K/-23K. For the EU Zone, we have after that the EU Perlim Flash GDP q/q 0.4%/0.3%. In the US trading, we have the CB Consumer Confidence forecasted to come out at 136.3 points versus 138.4 previously. And as we move into the closing of the US we have BOC Gov Poloz speaking. 

Wednesday starts off with Japan again and Perlim Industrial Production -0.2%/0.2%. During Asia trading, we are going to see the Japan Monetary Policy Statement, BOJ Policy Rates -0.10%/-0.10% that's for the BOJ not touching the rates yet and the BOJ Outlook Report. During the BOJ statements, we have JPY Consumer Confidence 43.5/43.4 and Housing Starts -0.5%/1.6%. As Europe begins we have German Retail Sales 0.5%/-0.1% and EU CPI Flash Estimate 2.1%/2.1%, CORE CPI Flash Estimate 1.0%/0.9% and EU Unemployment Rate 8.1%/8.1%. All in for inflation and the employment market. The US will hit us with the USD ADP Non-Farm Employment Change 190K forecast vs 230K and moments after that we have CAD GDP 0.2% previously, no forecast and USD Chicago PMI 60.3/60.4 and USD Crude Oil Inventories where previously they were 6.3M. Finishing the day we have BOC Gov Poloz speaking.

Thursday and the new month of November begin with JPY again and Final Manufacturing PMI 53.1/53.1. EU trading will bring us a ton of news for the UK economy. We have the GBP Manufacturing PMI 53.1/53.8, BOE Inflation Report, MPC Official Bank Rate Votes 0-0-9/0-0-9, Monetary Policy Summary, Official Bank Rate 0.75%/0.75% and BOE Gov Carney speaking. USD Unemployment Claims follows 213K/215K and ISM Manufacturing PMI 59/59.8. 

Ending the week, on Friday, we have German Final Manufacturing PMI 52.3/52.3. GBP Construction PMI 52/52.1 and on the US session we have CAD Employment Change 63K previously, Unemployment Rate 5.9% previously, CAD Trade Balance 0.5B previously and USD Average Hourly Earnings 0.2%/0.3%, Non-Farm Employment Change 191K/134K and Trade Balance -53.4B/-53.2B. 

 That's it pretty much, of course, you can filter out what you want by country or importance in the calendar on the site here or alternative ones if you have to decide what's important for you and what not. I am recapping only the most basic and important economic fundamentals that may and can drive the markets to have somewhat of an impact. Wishing everyone a successful week ahead!