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Dean's Daily FX Update – 16 October 2017
In the Zone
- GBPUSD
- AUDUSD
- NZDUSD
- USDCAD
- Gold
- Silver
Noteworthy News
- South Korea are preparing for another possible missile test by North Korea this week, things have gone a little quiet on that side and so we need to be aware of anything as it may potentially affect the gold price.
Recap
Last week was dominated once again by politics, not only in the UK where there seems to be a little bit of discontent over the leadership of PM May. There was also the political circus that is US politics and the antics of Trump that are fast becoming so farcical that the market will start to ignore. Over the weekend China released stronger than expected credit growth which has thus been ignored, the weaker trade balance figures last week were also ignored and this illustrates how difficult it has been for traders of late.
The end of last week also culminated in the IMF meetings that were held in Washington, central bankers have been very vocal this year. It was rather strange then the same central bankers go very quiet when they are put in the same room and as a result there was not much market movement yesterday on these talks. Friday instead was affected by a rather weak inflation report, the market was expecting something stronger after such an impressive PPI report and the result was the dollar giving back the gains it made on Thursday.
Cable as discussed was the most volatile pair last week and on Friday we saw the pair trade from 1.3260 to 1.3330 after the inflation report. I suspect that this may be pair to watch again this week, we have chief Brexit negotiator Davis and PM May travelling to Brussels this week. Despite the EU offering an olive branch last week I suspect the Germans will veto anything too friendly and so I will still look at anything closer to 1.3300 as opportunities for offers.
Similarly both the AUDUSD and USDZAR look poised to endure a little bit of dollar strength, they are both trading near major support and resistance levels as well as 61.8% fibs. The USDZAR in particular had a big move last week and I would expect there to be some form of rally there. I have further confirmation of these potential setups with both Gold and Silver looking to weaken this week.
There are some nice set ups starting to brew this week, and I am hoping that this week is more lucrative than last week.
Important Economic Data out today
- 14:30 USD Empire State Manufacturing Index
Consensus: 20.3
Effect: Actual higher than expected is good for the USD
- 23:45 NZD CPI
Consensus: 0.4%
Effect: Actual higher than expected is good for the NZD
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