The Week Ahead Preview 28th June 2nd July 2021

hi there this is brad gilbert with the week ahead preview all right now let's just have a look what's uh where we finished off friday the um pc price index numbers and i guess the university of michigan sentiment there as well but uh mr mark right we aren't expecting 0.6 it's a it's a good inflation number that the fed looks at and once again just missing that mark or no clear strength sort of supports what the fed's been saying that you know inflation is going to level out but it's not enough to make it a buying situation or a selling situation if you have a look here across the dollar index it's just drifting sideways right and just to finish up on friday equity markets almost it looks like they're almost closed right the uh us bonds the price a little bit higher so the yields just off a touch but no significant moves there and if you have a look at the major currency pairs with this lack of clear direction we aren't seeing any like standout uh opportunities now if i just take you to the charts just to give you a bit of a look before we come into the macros for the week the um you know after the fed um sort of brought forward their guidance you know managing the uh potential interest rate hikes all that sort of stuff we've seen the euro slowly claw its way back and now it's leveled out pretty much the same as sterling aussie and uh kiwi i think they've they've just come back and not overshot the top top side but they were sort of looking particularly heavy so i think the market's gone in uh short aussie kiwi and we've seen a bit more of a squeeze to the top side on those pairs but i would expect those to level out as well until we get some clear data up the top here you've got the dollar index drifting sideways as is dollar swiss although unlike the dollar index door switch has got a bit more room to move to the downside before it hits that support line and dollar yen lacking direction there as well and you can see petering out all momentum dollar cad right so we're in a situation where you see that's why it's so important to hit these moves when they happen right when the fed moves because that's the first trade is always the cleanest and then from here especially as last week or after last week the data didn't match up with a strong picture it wasn't weak but it wasn't strong and then we start to lose all momentum now that a lot of that um diffusion there came from the fed right there's very mixed opinions here uh on the from the fed with regards what page am i on there um let me just get that up all right so you know a bit of mixed uh views and opinions from various fed officials about inflation pressures are they going to wane have the fed go on too aggressive with their forward guidance etc and that really defused things somewhat now even the chairman jerome powell he was uh you know pretty relaxed and and sort of pretty confident that the inflation would sort of just dribble off as we move forward now it's one of those things that's that's all well and good they've given us the backdrop we know exactly what to expect now it comes into how do we map out the week right this is going to be very important because once again first week of the month we've got the u.s non-farm payrolls right so if you just scroll down through your calendar this is uh once again it's almost like the non-farms are coming around very quickly these days because they are obviously a major focus uh the fed has been talking about maximum employment and all these sorts of things but with inflation going through the roof it's going to be very interesting to see if if the employment numbers can match up with the strong inflation we start to get growth in employment in the us consistent growth well then that's going to support a stronger dollar and vice versa weakness here it probably goes a long way to saying you know what inflation probably was a uh just a blip on the radar we should start to see it come off so this is really uh crunch time for the next move unfortunately right we've got to wait until friday thursday you have the initial jobless numbers that come out weekly may give us a bit of a look in they aren't exactly connected but same sort of data hopefully there's some sort of correlation now so mapping that so we know that that's on friday so coming into thursday's trading if there's no sort of level of variance in the numbers then you are going to see the markets really go quiet ahead of the non-farm payrolls because that's where the answers are right so all the guys in all the banks sit there and they go well we're going to know the answer friday do i go aggressive monday tuesday wednesday well they won't unless something happens or something falls in their lap and what we're talking about is looking at the the numbers here right so even the nation white house prices out of the uk if you see significant change in any of these uh data releases and the eurozone economic sentiment numbers and the prelim german cpi numbers right these are a good opportunity to get into euro and sterling for that matter but i like euro a little bit more there's sort of less tangible things impacting uh euro than sterling and uh you come back down we've got some peripheral numbers here the case schiller numbers u.s consumer confidence okay all um coming out uh tuesday wednesday and then we come down we've got uh uk gdp employment out of germany um so there's a bit to play for every day of the week now the start of each month right especially obviously the first we start to get all the data now the tan can data back in my day in the 90s the tan cam was the biggest number especially out of japan massive manufacturing base so that's a good one to look for so if you are looking for ideas thursday's tan can is probably a good one to look at the yen and yen crosses right match up where market focus is going to be with the data that's how this that's how the markets work right so and then coming into as i said thursday friday there's a whole bunch of you know data out of europe a bit of north america but as i said the friday's going to be all about the non-farm payrolls and for those who are just joining us before you sort of jump up and down and you read a lot about this um how exciting this number is and it's the best trading opportunity it's not it's not the best there's high volatility you've got several numbers being released at once and if they aren't all in line you get a discombobulation in price action but what you can get if they are all strong or weak you know even a minute after you can see exactly what's happening you can see where momentum is and that should carry through to the following week where we get the uscpi numbers right that's the the whole cycle of what we're seeing at the moment the us dollar is the one economy uh and one central bank that is really in play so that's why we're looking at this very closely so all majors will be in play friday but leading into that just check out where the data is coming out that's that may give you a leading to where the opportunities lie all right so there's uh i was gonna say there's plenty to play for this you've just got to relax and wait for these opportunities to arise i know everyone's getting frustrated with a lack of connection and consistency with the us numbers but that's nothing that you can change right and looking at your daily charts if you are struggling for um some ideas on your dailies check out i mean sorry on your technicals look at the daily charts here the dollar you know it's still sort of broken back higher here um dollar swiss sort of mid-range dollar yen is still cracking to the top side seeing some wild price action here around uh resistance there on dollar cad it's it's a bit of a tricky one euro well you know what it's still sort of breaking down so keep an eye on that weak so this is an easy one weak your own data or strong us numbers euro should sort of drift lower quite comfortably and you can see here sterling as well well it is sort of trading sideways now but still below that previous support line as is the aussie and kiwi right so when you look at your hourly charts compared to your daily charts it tells you a different story this is the long-term trends or medium to long-term trends what's actually happening there if you can get the short-term trend on the hourlies matching up with what's going on on the daily charts that's an easier trade as well so make sure you focus on that and now just to pick off the currencies if you have got metastock make sure you are keeping a close eye on obviously u.s equities u.s equity futures during the asian session you've got the majors here bonds commodities etc but you can actually sort of match up if something big comes out in the u.s right we're looking for the the relative strength of these various pairs this should all light up blue or all red if the dollar is moving in a specific direction it'll make it easier for you to target the major currency pairs and then once again if we do get some european numbers come out specifically strong or weak keep an eye on the euro relative strength once again you'll be able to see if there's uniform price action or direction across the euro pairs and that goes for sterling the yen aussie etcetera as well right this is these pla these uh templates aren't here to um sort of look gorgeous they're there to help direct you into where to trade all right so this is a a really good week uh and i say that because not just because it's the first week of the month and we've got non-farm payrolls but there is a lot of second you know first second-tier data across the board on a lot of pairs in particular euro i like to look at that and it's going to be exciting once we get through thursday coming to friday the build up around the non-farm payrolls it always happens it's going to be pretty hectic hopefully we get some numbers going our way and ideally hopefully we get a bit more clearer direction on the us dollar as we lead into uh the non-farm payrolls all right guys have a good week all the best cheerio