Weekly Game Plan 25.9.17

You can always find my weekly analysis in the FXRENEW Blog each week, along with articles and thought leadership pieces. My new Coaching Page is also online. 

Here is this week's Game Plan:

A few political notes going into the week:

• The German elections are under way, and Merkel is almost guaranteed to win. However, she will also need to forma new "grand coalition" in order to form a government and the AfD are poised to take 15% of votes and as such it will be the first time in decades that a far right movement will make it into the bundestag. I wouldn't expect the Euro to be too excited until the actual coalition is formed. Also, the German election campaign has been disappointing to many voters apparently, given the lack of any discussion surrounding major issues like the Euro crisis, disintegration of the EU, refugee crisis, pension crisis, taxation.

• NZD may be vulnerable into the week, due to a hung parliament. The NZ National Party secured 58 seats in the parliament while Labour secured 45.  All Parties fell short of the 61 seats needed to form government in New Zealand’s 120-seat Parliament. New Zealand First will take on the role of kingmaker, as both Labour and the National Party will need his backing to form government. 

• GBP might also see more weakness after PM May’s Florence speech was seen by many as a betrayal of Brexit. A longer transition period and the fact that  Europeans will still be able to come and work in Britain were not welcome.

• Finally, Bloomberg reports Spain Rebuffed in Boosting Control Over Catalonia’s Police.  While sending in troops demonstrates just how much the central government can turn against it's people, we need to remember that the Spanish Constitution does not contemplate independence referendums. So what Catalonia is doing is, actually, anti-constitutional but the government is definitely overreacting.

• Finally, the "war of words" between NoKorea and the US has heated up so keep your squawk active.

USD: busy week in the US.  “Fed-speak” in the week ahead will be influential. Also, markets await the outline of the Republican tax reform plans due Wednesday.  Important data to be released include the final estimate for Q2 GDP growth; personal income and spending; PCE inflation; Chicago PMI and final figures for Q2 corporate profits.


EUR: GER & EU CPI, GER IFO and GER Retail Sales are due.

GBP: we only get the final GDP growth for Q2.

CAD: we will only see the monthly GDP and PPI figures.

AsiaPac: China will release figures for official manufacturing and non-manufacturing PMI. Caixin manufacturing PMI will also be closely watched.


Going into the week I remain cautiously bullish on EU equities, bullish on Crude Oil, bearish on Silver & bearish CAD. USD still needs to decide where it wants to go.