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. Tuesday sees the Reserve Bank of Australia (RBA) releasing their Cash Rate and Rate Statement. The cash rate, which is the interest rate charged on overnight loans between financial companies, is forecasted to remain unchanged at 1.50% and has already been priced in, any surprises would impact the currency, with a rate hike leading to a stronger AUD while a rate cut would lead to a deprecation of the AUD. The rate statement will communicate the RBA`s views and concerns, with a more hawkish report expected to lift the AUD while a dovish tone will see the AUD depreciate.
2. Thursday is election day in the UK, with British citizens pouring into voting stations around the country to cast their vote for either the Conservatives or the Labour party. The election effectively will give the winning party cart blanche on dealing with the Brexit procedure as the long and arduous road to negotiate Britain’s exit begins. Recent drops in value of the GBP on news that the Conservatives were short of a majority, suggests that UK markets are hoping for a conservative win. While a Labour win will likely weigh on the GBP.
3. Thursdays ECB release of the Minimum Bid Rate and the press conference which follows, will be of key importance. The Bid rate is expected to remain unchanged at 0% while all eyes will be looking at the press conference for clues as to the ECB`s view on the current and future outlook of the European economy. ECB President Draghi is expected to remain accommodative with any announcement of further easing surely to push the EUR lower while a more positive tone, in which the ECB sites reasons for holding monetary policy as is, will see the EUR snapped up.
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.com/fundamental-analysis/