It is very likely that the difference between success and failure in Forex/CFD trading depends primarily on which assets you choose to trade each week and in which direction, and not on the exact methods you might use to determine trade entries and exits.
Therefore, at the beginning of the week, it is a good idea to look at the big picture of what is developing in the market as a whole and how such developments are influenced by macro fundamentals, technical factors and market sentiment.
Fundamental analysis and market sentiment
Over the past week, risk appetite has remained bitter, and the main reason for this is the Fed policy meeting two weeks ago, which produced a “hawkish hold”. Although the Fed left rates unchanged as expected, it now plans to raise rates again by 0.25% later in 2023, meaning the terminal rate of the current tightening cycle has not yet been reached.
Last week was rather light in terms of major data releases, with the main events being the US core PCE price index, which is examined for clues to inflation, and the final GDP, which is an assessment of economic growth. The PCE came in slightly below expectations, which could be a positive sign regarding inflation. Final GDP was also slightly lower than expected.
Other key data released last week were:
- US central bank consumer confidence: slightly worse than expected.
- Australian CPI (inflation): An annualized rate of 5.2%, exactly as expected.
- US Jobless Claims – slightly better than expected.
- Canadian GDP – slightly worse than expected.
- Revised U.S. metric consumer sentiment: Slightly better than expected.
- IFO data on German economic climate: slightly better than expected.
- Chinese manufacturing PMI – as expected.
There were no real surprises.
The week ahead: October 2 – 6
Next week in the markets is likely to see a low level of volatility compared to last week as few high impact data releases are expected, although we may see considerable action in the AUD and NZD as central bank releases regarding each of them. of them. The key data released this week are, in order of importance:
- Change in US nonfarm employment, average hourly earnings, and unemployment rate
- JOLTS Jobs in USA
- Statement of RBA rate and cash rate
- Statement of RBNZ rate and official cash rate
- Swiss CPI (inflation)
- US ISM services PMI
- US ISM Manufacturing PMI
- Unemployment claims in the United States
- Canadian unemployment rate and change in employment
It's a public holiday Monday in Australia, Canada and China. Tuesday is a public holiday in China and Germany. The rest of the week is a public holiday in China.
Credit by DailyForex.com
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