Weekly Review and Outlook 28th November 2016

Mark NugentNov 2016, Trading Plan


Weekly Forex Review – Week Commencing 21st November 2016

Economic Calendar


On ZeroHedge: Europe’s most senior judge, Koen Lenaerts, states that Brexit is likely to end up in front of the ECJ in some form throughout the process. US President-elect Trump stated he will issue executive action on his first day in office to remove US from TPP, while Japanese PM Abe stated TPP trade pact is meaningless without inclusion of US. ECB’s Draghi stated that the ECB is committed to preserving an accommodative position but is committed to act if warranted.


Canadian Core Retail Sales m/m missed (0.1% vs 0.6%). The Iraq Governor stated that we are agreed and happy after the OPEC meeting with the Libyan Governor stating that there is consensus on what OPEC members will do. OPEC are to defer the issue regarding Iran and Iraq production cuts to November 30th, according to sources (ZeroHedge).


Markets saw little in the way of a reaction to the latest FOMC minutes release which saw the Fed suggest a rate hike is likely next month. FX markets were quiet ahead of US Thanksgiving.


German Ifo Business Climate came in as expected (110.4 vs 110.6). A horrible CPI number from Japan, in line with expectation but still horrible: Tokyo Core CPI y/y (-0.4% vs -0.4%), the eleventh consecutive deflationary number.


UK Second estimate GDPq/q was unchanged at 0.5% and as per expectation.

Market Reaction

The Trump effect may be abating with the USD peaking on Thursday and moving down on Friday. However, US equities continued to soar, some indices reaching new highs.The UK indices and the Euro50 consolidated. The Japan225 was up as the JPY weakened but both indices stood still on Friday. WTI was up then down and ended the week flat. The GBP continued its rise which started in early October. CAD falls from resistance as the oil price drops. Emerging markets currencies remain low but there is some sign of a move up in equities.

Trading Plan

Last week only one trade closed: Trade 78 (EURUSD short) closed at breakeven. Month-to-date performance at Friday’s close was +2.2% and year-to-date was +33.2%. However, today, Monday 28th November, has seen two trades close: Trade 79 (GBPUSD short) for a loss of 0.5% and Trade 80 (USDJPY long) at breakeven. Trade 77 (Euro50 short) remains alive and has moved into profit.

Weekly Forex Outlook – Week Commencing 28th November 2016

Economic Calendar

Over the weekend/early today (ZeroHedge):

Oil: informal producer talks set for today were cancelled and Saudi’s energy minister Al-Falih further added to the uncertainty as his comments suggested the door was open to the possibility of no cut in output. Alain Juppe conceded defeat in the French presidential conservative primary against Fillon who won with nearly 70% of votes. Additionally, a Harris Interactive poll suggested conservative candidate Fillon would beat Far-Right candidate Le Pen in the French Presidential Election by 67% vs. 33%. BoE’s Carney wants Britain to remain in the single market for at least two years after Britain leaves the EU to cushion the impact on businesses. The Clinton campaign stated that it will join efforts by Green Party to push for vote recounts in some battleground states where there was a close margin of victory for Trump.

Mon – ECB’s President Draghi is due to testify about the European Central Bank’s perspective on economic and monetary developments and the consequences of the Brexit before the European Parliament’s Economic Committee, in Brussels
Tues – US Preliminary GDP q/q; RBNZ Financial Stability Report followed by Gov Wheeler testifying before the Parliament Select Committee, in Wellington
Wed – UK Bank Stress Test results; OPEC Meetings; ECB President Draghi due to speak about the future of Europe at the University of Deusto Business School, in Madrid; Canadian GDP m/m; Core PCE Price Index m/m in the US
Thurs – China – various PMIs; UK Manufacturing PMI; US ISM Manufacturing PMI
Fri – Australian Retail Sales m/m; UK Construction PMI; US Average Hourly Earnings m/m and Non-Farm Employment Change

Financial News

Nothing to add to the coverage from ZeroHedge.

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