Big Week Ahead For US Data
US Data & Fed Speakers On Watch
While developments in the US/Iran peace process will remain the key driver for USD near-term, traders will be watching a slew of key US data this week. Price pressures will be in focus with CPI due on Tuesday, followed by PPI on Wednesday and retail sales on Thursday. On the back of the hawkish voting shift we saw at the last FOMC meeting, traders will be on the look out for any data seen as likely to shift the Fed further along the hawkish path. Indeed, with annualised CPI forecast to jump to 3.7% from 3.3% last month, USD could start to push higher again as traders start to ramp up hawkish Fed expectations.
Hawkish Fed Risks
At the last meeting, policymakers were heard expressing concern over the path of inflation while the Iran war persists. Given that no real progress has been made in negotiations (both sides refuse to budge on core demands), the standoff is no closer to ending and with oil prices remaining around the $100 p/b level, inflation pressures seem unlikely to subside any time soon. We’ll also hear from a slew of Fed speakers across the week with any hawkish comments likely to amplify a bullish USD response to a fresh rise in inflation, if seen.
Technical Views
DXY
For now, DXY remains within the falling wedge patten, having recent pushed back below the 98.24 level. With momentum studies bearish, a further decline is likely with the retest of the broken bear channel highs the next support zone to watch ahead of the 96.63 level. If bulls can get back above 98.24, 99.15 will be the next resistance to watch.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.