Trading the week ahead: Close attention to the BoE [Video]
|In this video, I walk you through the importance of tracking scheduled risk events to spot key market opportunities. Recently, I zeroed in on the Swiss CPI release on May 2nd. With the Swiss franc being oversold due to expectations of weaker inflation and lower interest rates, I saw a chance to buy if the CPI data showed higher inflation than expected. When the print came out hotter, I took long positions and saw the Swiss franc move upwards quickly, providing an excellent profit opportunity.
Looking ahead to this week's events, it's all about being prepared. The RBA interest rate decision is on my radar. The Reserve Bank of Australia has been ambiguous about future rate changes, so I'm watching for any shifts in language that might hint at a tilt toward rate hikes. That could push the Australian dollar up, particularly against the New Zealand dollar.
Another crucial event is the Bank of England interest rate decision. I'm paying close attention to any changes in how members vote. If more of them lean towards rate cuts, that could cause significant pound selling, especially with weaker GDP data expected on Friday. If a more hawkish stance emerges, we could see the pound get a small boost.
Finally, I'm watching the Canadian labor data on Friday closely. A miss would likely increase the odds of a Bank of Canada rate cut, pushing the CAD down. However, if the labor market data is strong, it might bolster the currency a bit. Labor data is a key inflation indicator, so investors will be closely analyzing the numbers.
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