Positioning for volatility

4 November, 2015

This week is turning out to be something of a waiting game for FX markets, given the swathe of UK events scheduled for Thursday and Friday’s payrolls data in the US. Ahead of that, we’ve seen the latest PMI data from China come in slightly better than expected overnight, with this helping a better tone to Asian stocks and also underpinning the better tone to the Aussie gained in the wake of the interest rate decision yesterday. AUDUSD is challenging the 0.7220 level, but struggling to hold above it for the time being. Sterling will be focused on the services PMI data today, which has been falling for the prior four months and given the extent of the turn-around seen in the manufacturing data earlier in the week, the market expects 54.5 (from 53.3).

The point in the UK is the long time until which a hike is fully priced in, which is currently fully priced for October of next year. It’s this which is most vulnerable tomorrow should the Inflation Report come out with a more hawkish tint, which would be supportive for sterling. EURGBP has been pretty relentless recently in its move lower, which could be enhanced in this scenario, pushing the cross back towards the 0.70 level. We also see trade balance and ISM data in the US today, with the latter seen steady on the final services measure. Overall, the market is still pricing nearly 50:50 chance of a Fed hike mid-December, so we’re going to see the dollar become increasingly sensitive to data releases as this meeting draws ever nearer.


Source link  
UK Consumer Price Index data

Eurozone Markit Manufacturing PMI (May) is expected to come in at 56.0 from 56.2 previously. Markit Services PMI (May) is expected at 54.6 v 54.7 previously...

FOMC Members will be speaking today

This shows a healthy economy with the 2018 average at a higher level than previous years. Slip under zero can cause a market reaction but is not...

Fed Speakers Take Centre Stage

Fed Member Mester is due to speak at the Central Banking Series hosted jointly by the Global Interdependence Center and Bank of France, in Paris...


Markets Steady Ahead of Euro Open

After further increases in stock markets yesterday, the market is pausing and consolidating ahead of European trading. Asian equity markets are in the green...

Oil Inventories to Show a Draw

Expectations (Apr) are expected to be released with a prior reading of 16.7. This data has been weakening since a reading of 52.0 was recorded in...

Chances of RBA Rate Hike

NZDUSD bucked the trend overnight, as most other currencies managed to retrace some of their declines against the USD. The pair hit fresh...


Consumer Sentiment Index Close to Higher

US Fed Boston President Rosengren is due to deliver the keynote speech on the economic outlook, at the Greater Boston Chamber’s Economic Outlook Breakfast...

Chinese president soothes worries

With US Producer Prices data on the way this afternoon, and predicted to be largely as expected, the morning session will be dominated by central bankers...

Markets fall after more tariffs proposal

Friday's session is expected to be volatile, with Non-Farm Payrolls (13:30 UK Time) ahead and President Trump’s proposal for an additional $100B...


In the past 24 hours Bitcoin has lost -4.27% and reached $7920.06. Open your trading account with the best cryptocurrency brokers on special terms today.

In the past 7 days the EUR/USD pair has lost -0.6235% and is now at $1.1765. Start trading and making money on Forex today.

In the past 7 days Ethereum has lost -9.72% and is now at $628.494. Have the most popular cryptocurrencies compared online 24/7.


Top Brokers offering Daily Forex Market Reviews


Forex Currencies Forecasts


Top 10 Forex Brokers 2018

# Broker Review
1easyMarketseasyMarkets89%
2FXTMFXTM88%
3HYCMHYCM86%
4FxProFxPro82%
5FIBO GroupFIBO Group81%
6FXCMFXCM71%
7HotForexHotForex70%
8XMXM69%
9Alfa-ForexAlfa-Forex68%
10Grand CapitalGrand Capital65%
  


Share: