Daily Trade Recommendation

Trade Recommendations for current Session

I will be holding back and simply looking to get into the market later in today’s session, this is due to allot of short term volatility on the obvious trades(that being sell the antipodean currencies against a stronger currency like USD) and given the fact that we have a slew of important news events later in today’s session.

As stated we have a notably active day on the calendar today starting with UK current account figures and a GBP reading, later in the session and more importantly we have a Eurozone CPI flash estimate which will give us an indication as to what the ECB’s next move might be. Moving to later in the session and across the Atlantic we have a Canadian GDP reading with the session finalising with a US consumer confidence figure whereby levels are expected to have marginally fallen.

Out of these news releases I will be looking at the Eurozone CPI figures and Canadian GDP reading, remember that these currencies are both fundamentally weak at present, therefore even if the data comes out positive and we get a rally I will simply be looking to sell into that as the currencies are only going to shift down over the coming weeks and months. This is especially true when considering the Euro, even though we’ve had a massive shift in price action on the currency over the past month since the ECB announced they will introduce stimulus packages, I still expect there to be a great deal of movement to the downside as there is no fundamental reason for the market to start buying the currency back.

Pre Session events

There has been a significant amount of volatility in the overnight session following a plethora of economic releases as we approach the end of September and move towards a new month on the calendar. This is most true when considering the Australasian currencies with both NZDUSD and AUDUSD that retraced slightly following continued selling pressure in yesterday’s session. There has been additional negative data released surrounding these currencies overnight with a poor ANZ business confidence reading and a weaker than expected Chinese PMI.

The Asian-Pacific markets suffered notable stock losses overnight on account of the current lack of stability in Honk Kong spurred by anti-establishment protests,in other news coming from the region the Chinese final HSBC manufacturing PMI fell short of forecast levels however Chinese exports are reported to be at highest levels in four years.