EUR/USD
Last week the EUR/USD pair rose to a weekly high, supported by positive economic data from the EU. Eventually nearing 1.1400. The largest price swings occurred on Thursday when the pair ranged between 1.1290 and 1.1400. This was down to the European central bank’s monetary policy meeting press conference where Mario Draghi first gave quite bullish remarks, which then reverted to a more negative tone towards the end. At the end of the week the pair dropped to the lowest level since March 29th and touched as low as 1.1210. This was due in part, to a stronger dollar, which benefited from a rise on stock markets and a weaker euro which suffered due to flat PMI services and manufacturing data.
This week the main event for all US dollar traders will be the FOMC meeting, which will take place on Tuesday and Wednesday. On Wednesday evening the new rate of interest and the FOMC statement will be published. There is a small chance that the Fed would change the rates, but more likely is that traders should anticipate some hawkish statements to prepare for an adjustment at some point in the future. If this happens, a fall to around 1.1000 might be on the cards. Additionally, traders should keep an eye on the U.S. Advance GDP data which will be published on Thursday at 12:30 PM (GMT).
GBP/USD
Last week GBP/USD lifted above 1.4400 despite a large drop on Thursday when ECB president Mario Draghi released ultimately dovish statements. Nevertheless, GBP strongly benefited from a visit of U.S. President Barack Obama who was vocal in his conviction that the U.K. should remain a part of European Union. The support from him pulled the pair to 1.4470, but was corrected slightly afterwards.
This week traders should mainly pay attention to three events. On Wednesday, expect larger volatility ahead of U.K. Preliminary GDP data, which is expected to show a smaller increase than last quarter. Later the same day, the pair is likely to be strongly affected by the FOMC statement and interest rate announcement. On Thursday traders should pay attention to the U.S. GDP data, which is predicted to show just 0.7% quarterly growth and might make dollar positions a little weaker.
GOLD
Last week saw the price of gold lifted about $40/ounce when the price increased from $1,230 to $1,270 per ounce, mainly due to lower than expected earnings releases from the U.S. Strong gains from the commodities market reduced demand for safe-haven assets. Combined with news that Bank of Japan is ready to use various new monetary policy tools to spur the economic growth, the yellow metal finished the week back close to $1,230/ounce.
This week traders must continue to watch the earnings reports which will be released. So far there was more bearish than positive news. Big companies like Google and Netflix dropped more than 5% after their reports. Even so, the U.S. indices managed to add slight gains. Additionally, this week the volatility should pick up ahead of the FOMC statement where markets might see some hawkish prediction about future interest rate hikes.
S&P 500
A short lived spike at the end of last week has seen an extension above an established resistance trend line. This testing of strong resistance levels has been a regular feature of 2016, but none have so far managed to be sustained. Rises beyond 2100 have had difficulty taking hold, and it is too early to get too confident in this latest activity.
Economic Calendar:
25/4/2016
All Day EUR Italian Bank Holiday
8:00am EUR German Ifo Business Climate
10:00am GBP CBI Industrial Order Expectations
2:00pm USD New Home Sales
26/4/2016
8:30am GBP BBA Mortgage Approvals
12:30pm USD Core Durable Goods Orders m/m
12:30pm USD Durable Goods Orders m/m
12:55pm CAD BOC Gov Poloz Speaks
1:00pm USD S&P/CS Composite-20 HPI y/y
1:45pm USD Flash Services PMI
2:00pm USD CB Consumer Confidence
2:00pm USD Richmond Manufacturing Index
5:00pm GBP MPC Member Cunliffe Speaks
10:45pm NZD Trade Balance
27/4/2016
1:30am AUD CPI q/q
1:30am AUD Trimmed Mean CPI q/q
4:30am JPY All Industries Activity m/m
6:00am CHF UBS Consumption Indicator
6:00am EUR German Import Prices m/m
6:00am EUR GfK German Consumer Climate
8:00am EUR M3 Money Supply y/y
8:00am EUR Private Loans y/y
8:30am GBP Prelim GDP q/q
8:30am GBP Index of Services 3m/3m
10:00am GBP CBI Realized Sales
12:30pm USD Goods Trade Balance
2:00pm USD Pending Home Sales m/m
2:30pm USD Crude Oil Inventories
6:00pm USD FOMC Statement
6:00pm USD Federal Funds Rate
9:00pm NZD Official Cash Rate
9:00pm NZD RBNZ Rate Statement
11:30pm JPY Household Spending y/y
11:30pm JPY Tokyo Core CPI y/y
11:30pm JPY National Core CPI y/y
11:30pm JPY Unemployment Rate
11:50pm JPY Retail Sales y/y
11:50pm JPY Prelim Industrial Production m/m
28/4/2016
1:30am AUD Import Prices q/q
Tentative JPY Monetary Policy Statement
5:00am JPY BOJ Outlook Report
5:00am JPY BOJ Core CPI y/y
5:00am JPY Housing Starts y/y
All Day EUR German Prelim CPI m/m
Tentative JPY BOJ Press Conference
7:55am EUR German Unemployment Change
12:30pm USD Advance GDP q/q
12:30pm USD Unemployment Claims
12:30pm USD Advance GDP Price Index q/q
2:30pm USD Natural Gas Storage
10:45pm NZD Building Consents m/m
11:05pm GBP GfK Consumer Confidence
29/4/2016
All Day JPY Bank Holiday
1:00am NZD ANZ Business Confidence
1:30am AUD PPI q/q
1:30am AUD Private Sector Credit m/m
3:45am AUD RBA Assist Gov Debelle Speaks
6:00am EUR German Retail Sales m/m
7:00am CHF KOF Economic Barometer
8:00am CHF SNB Chairman Jordan Speaks
8:00am EUR Italian Monthly Unemployment Rate
8:30am GBP Net Lending to Individuals m/m
8:30am GBP M4 Money Supply m/m
8:30am GBP Mortgage Approvals
9:00am EUR CPI Flash Estimate y/y
9:00am EUR Core CPI Flash Estimate y/y
9:00am EUR Unemployment Rate
12:00pm GBP MPC Member Cunliffe Speaks
12:30pm CAD GDP m/m
12:30pm USD Employment Cost Index q/q
12:30pm USD Personal Spending m/m
12:30pm USD Personal Income m/m
1:45pm USD Chicago PMI
2:00pm USD Revised UoM Consumer Sentiment
2:00pm USD Revised UoM Inflation Expectations