Weekly Game Plan 2.7.18

You can always find my weekly analysis in the FXRENEW Blog each week, along with articles and thought leadership pieces. Our best pieces can be found in one placehere. If you want to get an idea for how I trade trends, this webinar will help. If you want to know how I Trade the News, this plan will help. 

Here is this week's Game Plan:

Back on deck after a brief break from the markets. Welcome to H2 2018! This week starts with Canada Day and then we get US Independence Day on Wednesday.

Themes for the week ahead: 

China will remain a big focal point this week. Over the weekend, PMI data disappointed, most likely suffering from tighter credit growth and rising US/China trade tensions. The new export order sub-index fell into contraction territory for the first time since February. If that weren't bad enough,  US trade tariffs on China are set to take effect on July 6 (Fri). CNY fixes will be watched closely as participants feel that the PBOC is allowing the CNY to drop in order to fend off the tariffs. This isn't positive because int'l investors want to see a stable (non-manipulated) currency in order to have confidence in a country as influential as China.

Beyond that, the CSU (Merkel’s coalition partner) still has to  decide whether Friday's EU immigration deal satisfies their concerns about containing the borders. The vote hasn't been issued just yet so participants will likely look for that tomorrow first thing. Expectations are for a positive vote...I'm not so sure. 

Will Saudi Arabia bow to Trump? Just after OPEC decided to increase production by around 1 million bpd, Trump demanded an extra 2 Mln bpd! Obviously the markets will sell Crude if Saudi complies. Keep your eyes on the story and on Trump's tweets.

Data in the week ahead: 

On the data front, the big item is NFP but ahead of that we get Caixin Manufacturing and Services PMI, RBA rates decision and Australian Retail Sales, UK PMIs and CAD Employment.

What's on the Radar:

The moves in the USD on Friday were heavily influenced by technical and month-end factors - so don't give them too much weight. Moreover, NZD is a clear loser after RBNZ's dovish hold; CAD is a clear winner after Crude Oil's ascent. Copper is still weak. Regarding equities, we'll need to wait & see what comes of CSU's vote and tariffs this week.

NZDCAD: https://www.tradingview.com/chart/NZDCAD/CfiW6Rqk-NZDCAD-Bias-Remains-Short/
EURNZD: https://www.tradingview.com/chart/EURNZD/302APxVk-EURNZD-Bias-Up-but-Strong-Resistance-Ahead/
Crude: https://www.tradingview.com/chart/CL1!/FngjjYd5-Crude-Oil-Bias-Remains-Positive/

Copper: https://www.tradingview.com/chart/HG1!/WhFvFeez-Copper-Bias-remains-negative-but-supports-in-focus/