The week ahead has many a fundamental news release to look forward to, events which are sure to have traders licking their lips at the implied volatility and the numerous trading opportunities they create. Let us take a look at our top 3 picks:
1. First up is the Reserve Bank of Australia (RBA) releasing their Monetary Policy Meeting Minutes on Tuesday morning. The minutes will communicate the RBA`s views and concerns regarding the Australian economy as well as the reason for the recent decision to hold rates at 1.5%. Should the report show that there are several key reasons for not increasing rates, that imply a longer duration of unchanged rates, we would see the AUD soften as trader’s price in the new dovish information. However, a more hawkish report is expected to lift the AUD as trader’s position themselves for a potential tightening of monetary policy by the RBA.
2. Following Australia’s lead is New Zealand who will be releasing their Rate Statement and Monetary Policy Statement on Wednesday. The Cash rate, is expected to remain unchanged at 1.75%, which has already been priced in. Any surprises will result in severe volatility with the NZ dollar strengthening in the case of a rate hike and vice versa in the case of a rate cut. Investors will be glued to the screen to try and decipher the Statement for clues as to the current and future views and actions of the RBNZD, with positive comments likely to see the NZD gain strength while negative comments will see the NZD sold off.
3. Friday sees the release of the Canadian CPI m/m, a very important figure, which give investors a glimpse into the health of the Canadian economy. The CPI figure is a key inflation figure which is the most important figure in terms of interest rates as central banks generally try to keep the CPI at a specific level, increasing or decreasing interest rates as their main tool for controlling inflation. A better than expected releases will see the Canadian dollar appreciate while a worse than expected print will see a depreciation of the CAD.
The above are just the tip of the iceberg of the daily events which occur in markets, for daily technical and fundamental analysis please visit: https://www.opteck.biz/fundamental-analysis/