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The Week Ahead 16th Oct-20th Oct

Preparation is Key

Whilst learning to trade one of the most important aspects you need to be aware of is that of preparation.
It was once famously said that by failing to prepare we are preparing to fail.
Well let us help a bit and guide you through the important events during the week ahead.

 

FED sticking to gradual rate rise path.

Monday sees a quiet start in terms of data, although there are some very good technical trading patterns around discussed below. The only figure on the slate for Monday is US Empire Manufacturing with one speaker scheduled in the form of Kashkari from the FED. That said, we expect the rhetoric from him to be in line with everything else we have been hearing of late. That being that the FED will be raising rates gradually and patiently whilst monitoring the latest trends in inflation.

Tuesday is a bit busier with UK inflation data released alongside German ZEW in the morning. UK Governor Carney is your main speaker.

 

Low on Data. Speakers continue.

Wednesday, we hear from the ECB in the form of President Draghi whilst FOMC Members are busy also with Fischer, Dudley and Kaplan all speaking. We get the usual oil numbers released also at 15.30 UK time. Thursday sees UK Retail Sales and US Philly FED survey. Friday sees US Home Sales and FED Chair Yellen speaking.

All in all, there is very little to get excited about in terms of data moving the market. As we mentioned it would seem unlikely that the speakers we see this week will change the course of rate moves that we have been seeing.

 

An ear on the News

Traders will look for the technical picture to become a little bit clearer in the markets after a week, especially in Bonds, that saw 4/5 days stuck in a very awkward range. In the meantime, keep an ear out for the usual suspects of market moving events in North Korea, which has gone disturbingly quiet save for a few mummering’s that they are armed with missiles that can now reach America. Catalan will still be seeking independence or maybe not! We get confused! Brexit rumbles on as PM May remains under pressure and there seems to be a deadlock in terms of negotiations. And now Iran. President Trump has ripped up nuclear agreements and now seems to be on the warpath against yet another nation.

 

Watching Inside Weeks

Last week we saw two inside weeks in the markets. The first was in the bunds that held the inside week until Friday when we broke out. Traders will be looking to get long on any retracement back down to the level of 161.82 in the 10 Year German Bond market.

The Cable, Pound against the US Dollar, finished the week on an inside week. At time of writing we remain in the range looking for a breakout. To the upside the break comes in at 1.3363 and the downside sits at 1.3100. Breaks of either of these levels would hopefully some directional momentum enter the market in line with the side that breaks.

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