Weekly Game Plan 3 Feb 20

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:

Fear of China’s coronavirus outbreak was the major theme in the global markets last week. As we speak, the number of confirmed cases is close to 12000. While the majority of the infected in China, the virus has spread to at least 23 countries already. The peak should be around Feb 10th, based on latest estimates. Global equities suffered while safe haven flows pushed bond yields sharply lower. Evidently, AUD,NZD,CAD were the weakest in FX while JPY, CHF and GBP were the strongest last week.


This virus is by no means as lethal as SARS, but it spreads much quicker and the economic impact will be more severe. That is the main preoccupation which is sending markets into risk-off mode. We have a decent week ahead with lots of news, a Central Bank decision and NFP to top it off.

Themes for the Week:

• CoronaVirus: Some 60 million people at the centre of the outbreak are living under virtual lockdown. A shock to China's economy this quarter, which then reverberates through global supply chains, is a foregone conclusion. It's just that no one can yet say how deep. Watch the Shanghai exchange when it opens up Monday...
• NFP: Friday's non-farm payroll data will show how the U.S. economy fared in the first month of the new decade. The report is expected to show a pickup from December, with a Reuters poll forecasting 156,000 were added, from 145,000 the month before.
• RBA Decision: no cut is the baseline scenario, but growth projections should be lowered. The market is expecting a dovish statement.
• Volatility is back: traders should get ready for more volatile markets, which is good for trading but seems to always catch the markets off guard.

Data in the Week Ahead:

• Caixin PMI
• US ISM Manuf & NMI
• RBA Decision
• NZD Employment Change
• ECB Lagarde Speech
• AU Retail Sales
• RBA Lowe speaks
• RBA Minutes
• NZD Inflation Expectations
• CAD Employment
• US NFP

On the Radar:
I still have ASX200, Dow, Dax biased short, Crude biased Short, Gold biased long. In FX, CHF,JPY, GBP strength vs. AUD,NZD,CAD weakness.