Weekly Review and Outlook 17th July 2017

Mark NugentJuly 2017, Trading Plan

Weekly Forex Review – Week Commencing 10th July 2017

Economic Calendar

Over the weekend:

Baker Hughes Oil Rig Count (Jul) W/W 763 (Prev. 756).

Monday

It was a quiet day on the calendar.

Tuesday

Fed’s Harker (Voter, Hawk) said slowing inflation gives him pause on raising rates. Would like to start halting reinvestment and see how the market reacts and then consider the third hike. (Newswires)

Fed’s Brainard (Voter, Dove) said she seen balance sheet reduction as appropriate soon, which will happen over several years. (Newswires)

Trump’s son’s Russian connections are causing concern.

Wednesday

GBP Average Earnings Index hit target at 1.8%.

Bank of Canada raised interest rates as expected to 0.75%.

BoC GDP & CPI forecasts:

GDP forecasts:

2017 2.80% vs. prev. 2.60%
2018 2.00% vs. prev. 1.90%
2019 1.60% vs. prev. 1.80%

CPI forecasts:

2017 1.60% vs. prev. 1.90%
2018 1.80% vs. prev. 2.00%
2019 2.10% vs. prev. 2.10%

Fed chair Yellen repeats view for gradual hikes in her prepared testimony to the House Financial Services committee

– Balance sheet reduction to begin this year, long-term size still to be determined

– Rates will not need to rise much further to get to the neutral rate

– Economy picked up in Q2

– Carefully monitoring prices, Yellen attributes recent dip to a ‘few unusual’ price declines for certain items

Thursday

US Fed Chair Yellen indicated that the era of cheap money will not end anytime soon.

Friday

US Headline and Core CPI and Retail Sales all missed.

Market Reaction

Risk tone was largely positive over the week. However, poor US data on Friday and a “Trump discount” is colouring the sentiment on the USD, which was down over the week. US equities rose, with the S&P500 and Dow30 closing at new all-time highs. Oil rose on the week, going through the 50MA. The US 10 Year yield dropped over the week. The JPY was indecisive and the GBP rose to resistance. AUD continues to strengthen on good Chinese data and rising commodity prices.

Trading Plan

Two trades closed last week. Trade 43 (AUDUSD long) closed for a gain of +0.5% and Trade 44 (EURGBP long) closed for a loss of -0.75%. Month-to-date performance is -0.25% and year-to-date performance is +9.2%.

Weekly Forex Outlook – Week Commencing 17th July 2017

Economic Calendar

Over the weekend:

US Baker Hughes Oil Rig Count (Jul) W/W 765 (Prev. 763).

In the news:

Brexit talks resume

USD down – Trump no longer good news

Mon – Positive Chinese data this morning with Industrial Production and Retail Sales beating expectation and GDP on target.

Later we have NZD CPI and EUR CPI.

Tues – AUD Monetary Policy Meeting Minutes; GBP CPI.

Wed – USD Crude Oil Inventories.

Thurs – JPY Policy Rate and Statement; GBP Retail Sales; EUR Minimum Bid Rate and Press Conference.

Fri – CAD CPI and Core Retail Sales

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Here is your Weekly Review and Outlook video.

I discuss last week’s trades at 5:10 and this week’s trading plan at 11:55.

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The themes for this week’s trading can be found HERE.

Profiles for this week’s trading ideas can be found HERE.


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