GBP/USD
Event Risk UK and US
Trading Tip - These are the event risks that are the most important to watch in the week ahead. Total event risk is clearly stacked in the dollars favor. At the same time, most of the key numbers are expected to print lower. This puts the pair in a particularly precarious position since it is currently trading at the top of the range. Should the dollar not make any headway on a data free Monday (or worse, should it move to 1.9735) the risk may be too great for a short.
UK The British pound is certainly confronted with a number of economic indicators, though their market moving potential seems lacking. Starting late in the week on Wednesday, the Nationwide home inflation index should bow to the more consistent GfK sentiment report. Confidence will be particularly important as the BoE sorts out whether or not consumer spending will continue to push price gauges beyond the MPCs tolerance level. The following day has three indicators, but there is little chance that any one of them can muster a move by itself. Look for consistent improvements or deteriorations for subsequent movement.
US In comparison to the UK docket, the US calendar is a veritable mine field. Concentrated towards the middle of the week, many of the indicators are heavy hitters. Tuesday opens with an expected drop in durable goods orders. This report may be integral in defining the fundamental theme for the week and the overall technical setup since it can help to move spot price off of the range high. As the week wears on, the flow only becomes heavier. New and existing home sales are on deck, so is the PCE and personal spending. The GDP revision will be interesting as economists predict a hefty downward revision.
| Data for February 26 March 2 | | Data for February 26 March 2 | ||
| Date | UK Economic Date | | Date | US Economic Data |
| Feb 28 | Natwide House Prices (FEB) | | Feb 27 | Durable Goods Orders (JAN) |
| Feb 28 | GfK Consumer Confidence (FEB) | | Feb 28 | GDP Annualized (4Q P) |
| Mar 1 | M4 Money Supply (JAN F) | | Feb 28 | New Home Sales |
| Mar 1 | PMI Manufacturing (FEB) | | Mar 1 | Personal Spending (JAN) |
| Mar 1 | UK CBI Dist. Trades (FEB) | | Mar 1 | PCE Core (JAN) |
| | | | Mar 1 | ISM Manufacturing (FEB) |
AUD/USD
Event Risk Australia and US
Trading Tip These are the event risks that are the most important to watch in the week ahead. It will once again turn into a battle between individual indicators to win the AUDUSDs favor next week. However, it is typically unusual for all the data to line up with either the bulls or the bears. Therefore, a fundamental traffic jam would be the best scenario tight ranges, though bullish surprises for the dollar would be a boon for working the formation more effectively.
Australia Were it not for the USs stock, Australian data would definitely be considered a top priority for conservative range traders. The data starts off early with the HIA New Home Sales gauge, though the indicator has yet to garner a strong following in the FX ranks. Later, the AiG manufacturing indicator will take the temperature of the more fickle areas of the business sector. However, Monday offers the true test of the Australian calendar with the monthly retail sales figure and two quarterly reports. Capital spending and the current account balance will offer considerable insight into the overall health of the Asian-Pacific economy.
US The US calendar is a veritable mine field. Concentrated towards the middle of the week, many of the indicators are heavy hitters. Tuesday opens with an expected drop in durable goods orders. This report may be integral in defining the fundamental theme for the week and the overall technical setup since it can help to move spot price off of the range high. As the week wears on, the flow only becomes heavier. New and existing home sales are on deck, so is the PCE and personal spending. The GDP revision will be interesting as economists predict a hefty downward revision.
| Data for February 26 March 2 | | Data for February 26 March 2 | ||
| Date | Australian Economic Date | | Date | US Economic Data |
| Feb 26 | HIA New Home Sales (JAN) | | Feb 27 | Durable Goods Orders (JAN) |
| Feb 28 | AiG PMI (FEB) | | Feb 28 | GDP Annualized (4QP) |
| Mar 1 | Private Capital Exp (4Q) | | Feb 28 | New Home Sales |
| Mar 1 | Retail Sales (JAN) | | Mar 1 | Personal Spending (JAN) |
| Mar 1 | Current Account Balance (4Q) | | Mar 1 | PCE Core (JAN) |
| | | | Mar 1 | ISM Manufacturing (FEB) |
EUR/CAD
Event Risk Eurozone and Canada
Trading Tip Upcoming data may fall either way for both currencies. Given a pronounced rally in the Canadian dollar, however, risks may point to a potential CAD retrace. This supports the notion that EURCAD will remain above 1.5170 and 1.5085, providing a fundamental bias to long positions. As written above, however, a break below 1.5085 very clearly negates the range trading scenario.
Eurozone The European calendar looks to provide solid event risk in upcoming trade, with special attention to German CPI, Unemployment, and Retail Sales figures. Evenly spaced events arguably point to dangerous range trading conditions, but the virtual certainty that the ECB will hike in March may relieve any reactions following Tuesday CPI data. This leaves key figures on Wednesday and Friday. Be prepared to close any positions following sharp surprises on any of these three releases.
Canada An empty calendar from Monday to Wednesday provides scope for relatively stable CAD price action. Thursdays Current Account and Fridays GDP numbers could potentially destabilize the North American currency, however, with any surprises to likewise drive the EURCAD to volatile moves. Combine these with significant Friday Eurozone data, and EURCAD range trade positions may look to be in jeopardy at the end of the week.
| Data for February 26 March 2 | | Data for February 26 March 2 | ||
| Date | Euro Zone Economic Date | | Date | Canadian Economic Data |
| Feb 26 | German GfK Confidence (MAR) | | March 1 | Raw Materials Price Index (JAN) |
| Feb 27 | German CPI (FEB P) | | March 1 | Current Account (BOP)(4Q) |
| Feb 28 | German Unemployment Change (FEB) | | March 2 | |
