WEEKLY COMPREHENSIVE ANALYSIS
FOR THE PERIOD BETWEEN
January 22nd – 27th, 2017
Previous week:
Tough but nice week. I describe it that way because despite that fact that it holds a lot of talks and volatility, but it makes the picture clearer than the previous 2 months. The main points on Mr. Draghi`s speech was that the interest rates are expected to remain unchanged for long period of time with the probability of decreasing it more. Also the APP program will remain at 80B till March through February, and it will be decreased to 60B till the end of 2017. Finally he said that the economic growth in the euro area still dampened by sluggish pace of implementation of structural reforms in the Euro area.
Of course the speech made by Mrs. Yellen before the commonwealth club was very hawkish, and may be that what drives me to say that that week made the view clearer. She put it very well when she said that she and the all of the other members are expecting interest rate increase few times (many times) until 2019, until it reaches 3% and she called it the "neutral rate". Also she said that it will be appropriate to reduce the monetary policy support gradually.
Next week:
We have NZ & GB CPI and GD & US GDP. It seems to be strong but not volatile week. Also we have a speech by Mr. Draghi on Monday concerning Italy.
The greatest now will be from the UK continuous announcements on the BREXIT which will harm the FX market.
What will be my trade next week?
Previous report I recommended two trades NZD/CHF short and GBP/NZD short. The first is going well and I have achieved around 50 pips and continuing with it. On the other hand I am not recommending avoiding trading the GBP for the medium and long term due to the deliberate unscheduled announcements given by the UK government and my believe that the BOE is interfering the markets to depreciate the GBP.
Anyway for the next week I am continuing to short NZD/CHF TP: 0.6750 SL: 0.7400.
For more medium term and daily signals;
Wishing you successful trading J