Weekly Market Commentary | 09.10 – 15.10
09 October 2023
Curious to know what’s happening on the markets this week? Take a quick tour of the latest news, economic updates, and trading setups that will keep you up-to-date and in the know.
- Markets initiate with a calm macro calendar, observing bank holidays in Japan, Canada, and the US.
- A noticeable shift towards safe havens in the initial trading hours points to a market sensitively responding to developing violence in the Middle East.
- Initial responses: bearish indices, bullish commodities, and strengthening of safe currencies like the American dollar, Swiss franc, and Japanese yen.
- The geopolitical unrest is poised to be a dominant theme throughout not just today but potentially the days to come.
- An empty calendar with no tier 1 data anticipated, yet markets may continue to grapple with the ripple effects of the Middle East turmoil.
- A day likely to be characterized more by geopolitical reflections than macroeconomic impulses.
- A surge of financial data, including the US PPI, punctuates the midweek trading environment.
- FOMC meeting minutes hold the potential to sculpt trading trajectories, with markets keenly attuned to insights into the Federal Reserve’s perspectives and potential future actions.
- The UK broadcasts its GDP figures, forecasted at a modest 0.2%, offering insights into its economic recovery.
- The US enters the spotlight with key inflation data, an annual projection pinning it at a reduction to 3.6%, alongside unemployment claims, anticipated to tally at 216,000.
Setups for This Week:
- China presents its inflation data, predicted to unveil a 0.2% increase, a metric invariably watched by global markets due to China’s economic stature.
- A cascade of authoritative voices: Speeches from Bank of England Governor Bailey, ECB President Lagarde, and FOMC member Harker will be meticulously dissected by traders and investors alike.
- Concluding the week, the Preliminary University of Michigan Consumer Sentiment from the US is projected to stand at 67.5, potentially offering a window into consumer perspectives amidst ongoing economic narratives.
- A bullish gap kicks off the week, revealing an assertive upward push in precious metals, markedly in silver.
- Rooted in the Middle East violence, this bullishness wasn’t entirely unforeseen, as the previous week closed on a high, escaping a sideways trend indicated by an orange marker.
- Current trajectory advocates a buy, casting eyes towards the yellow area as a plausible target.
- A reversion back into the bounds of the orange rectangle paves the way for a sell signal.
- Despite concluding last week on a bullish breakout from a sideways trend, defined by orange lines, Nasdaq opens this week with a bearish gap and flirtation with returning to said trend.
- If the price finds itself encapsulated again within the orange confines, it embodies a sell signal.
- Surmounting the orange lines, subsequently maintaining a position above, would signify a long signal.
- With safe havens in vogue, the Swiss Franc capitalizes, guiding GBPCHF to a testing phase against the pivotal 1.11 horizontal support, illustrated with a green marker.
- A breakthrough descending past this green line would firmly plant a sell signal in the landscape.
- Conversely, a bounce from the green demarcation serves as a beacon for a long position.