Today on the economic calendar empties, but in the following days we can expect a recovery in the markets caused by events such as speeches by President Powell before Congress on Wednesday and Thursday, the ECB decision and Friday’s payrolls ( US labor market report).
- Monday: Switzerland CPI.
- Tuesday: Tokyo CPI, China Caixin Services PMI, Eurozone PPI, US ISM Services PMI.
- Wednesday: Australian GDP, Eurozone retail sales, US ADP, BoC policy decision, US job vacancies, Fed Chair Powell’s testimony.
- Thursday: Japanese wage data, Swiss unemployment rate, ECB decision, US unemployment claims, Fed Chair Powell’s testimony.
- Friday: NFP from the US, Canadian labor market report.
Fed Chairman Powell will testify before Congress and, as always, market participants will be on the lookout for any comments or hints about the trajectory of monetary policy. The text is usually released before the testimony, so it will be scanned for clues or “biases,” but the market will also focus on the question-and-answer session following the opening remarks.
The ECB is expected to keep the deposit rate unchanged at 4.00%. Central bank members continue to support a cautious stance, and the consensus is to wait for Q1 2024 payroll data before considering a rate cut in June, which is also currently expected by the market. Recent data support the ECB’s stance, as Eurozone CPI exceeded expectations and the labor market remains historically strong.
The U.S. NFP report is expected to show 200,000 new jobs in February versus 353,000 in January, and the unemployment rate is expected to remain unchanged at 3.7%. Average hourly earnings are expected to come in at 4.4% y/y vs. 4.5% previously, while the M/M ratio is expected to come in at 0.3% vs. 0.6% previously. Average weekly hours are expected to rise to 34.3 versus 34.1 previously. The latest report surprised markets with a huge increase, with the only bad reading in the household survey being a second consecutive drop in employment.
Bearish engulfing on USDCHF
At the end of the day on Friday, a large downward candle appeared on the currency pair of the US dollar against the Swiss franc on the H4 time interval. It completely covered with its range 3 previous candles, forming a bearish engulfing. This morning’s data from Switzerland indicate (0.6%) higher than expected 0.3% inflation, which strengthened the franc against the USD.
It is possible that this signals the start of a downward correction. An additional factor in favor of a bearish scenario is the downward divergence on the MACD oscillator.
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This WEEK (04-09 March 2024 ) I am pleased to invite you to several online sessions. Below is the schedule of meetings:
Links: BASIC (beginners room) ADVANCED ROOM
The above analysis is based on the PA+MACD strategy, a detailed description of which you can read HERE . I will talk more about the PA+MACD strategy applied to these currency pairs during the live trading sessions, which you can attend from Monday to Friday.
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