James Trescothick

With more than 20 years of experience in financial service industry, James is our Senior Global Strategist and the co-producer and presenter of easyMarkets educational videos. When he is not working on educational programs or preparing webinars, you can find him with the easyMarkets team giving seminars around the world.

Welcome to the easyMarkets weekly review where we look back over the results of some of the previous week’s economic indicators. It gives us the chance to reflect on how much expectations were met or missed and to examine a successful trade you could have made this week.

Event: US Consumer Confidence

Date: Tuesday 28 March 2017 at 14:00 GMT

Markets affected: EUR/USD, GBP/USD

Trending hashtags: #usd, #consumers

Consumer Confidence for March leaped to 17 year highs hitting 125.6 according to data released by The US Conference Board. Like the previous month, March surpassed analysts’ expectations of 114 by quite a wide margin. US consumers are confident on finding work, business conditions and in the state of the economy in general. The US dollar rose against the euro after the announcement from 1.0868 just before the release, to 1.0856 just after the release, but retraced some of the gains later in the day to 1.0872.

Event: Bank of Canada Governor Speaks

Date: Tuesday 28 March 2017 at 14:10 GMT

Markets affected: CAD/USD

Trending hashtags: #cad, #boc

Governor of the Bank of Canada, Stephen Poloz, delivered a cautious speech on Tuesday at Durham College. Even with positive economic data, his comments were conservative on the nation’s economic outlook. With the central bank’s next policy decisions due on 12 April, investors will be taking note of his statements from January where he did not discount the idea of a possible interest rate drop. Poloz’ stance of pro-free trade is in sharp contrast to the Trump administration’s more isolationist rhetoric, bringing concerns over the NAFTA free trade agreement between the two nations.

Event: UK Triggers Article 50 for Brexit

Date: Wednesday 29 March 2017

Markets affected: EUR/ GBP, GBP/USD, GBP /AUD, FTSE

Trending hashtags: #brexit, #article50, #gbp

The UK have entered what many consider as the ‘road of no return’ as they triggered Article 50 of the Lisbon Treaty and formally beginning proceedings to pull out of the EU. While the markets had already priced in a lot of the Brexit fallout, the pound still went on a rollercoaster ride as it fell to $1.23 just before the event, rose 0.2% to $1.2478 after Brexit was triggered, only to drop again later in the day to $1.2403. The sterling rose against the euro 0.6% to €1.1595 after Brexit proceedings began, though retraced its gains to close at €1.1542. Meanwhile key indices, the FTSE 100 fell 0.4% but ended the day up 0.41 and the FTSE 250 also dropped 0.13% at first, only to rise again 0.21%.


Event: EU Consumer Confidence

Date: Thursday 30 March 2017 at 09:00 GMT

Markets affected: EUR/JPY, EUR/ GBP, EUR/USD, DAX, CAC

Trending hashtags: #eur, #consumers

The Consumer Confidence release for the Euro Zone gave no surprises on Thursday coming in at -5. This was spot on to what analysts were forecasting and identical to the previous reading. Following the start of Brexit, it was not a surprise that consumers in the region remained conservative in their sentiment for the region’s economic activity.

Event: US Annualised GDP (Q4)

Date: Thursday 30 March 2017 at 12:30GMT

Markets affected: EUR/USD, GBP/USD, SPI, NDQ, DOW

Trending hashtags: #usd, #gdp

Gross Domestic Product for the fourth quarter of last year came in at 2.1% growth, better than the previous reading of 1.9%. Analysts had anticipated a slight improvement of 2% and they weren’t far off. Consumer spending was also revised up 0.5% to 3.5% and corporate profits continued to grow. The result shows a strong year for the US economy compared to the previous year that saw corporate profits drop to the lowest in a number of years. An improved global economy and better commodity prices have played their role in helping companies’ bottom line, as have steps taken to reduce costs.  The outlook for 2017 under the Trump administration is positive as business sentiment grows and encourages jobs and wage increases in anticipation of reductions in regulatory requirements and corporate taxes.

Trade of the Week

Time in: Wednesday 29 March 2017 at 06:00 GMT
Market : EUR/GBP
Investment: $500 with 200:1 leverage
Time out: Thursday 30 March 2017 at 18:00 GMT

P&L: $1,753

If you had sold the EUR/GBP with a $500 margin at the price of 0.87179 and closed the deal one day after the UK triggered Article 50 for Brexit on Wednesday which saw the currency pair fall 1.75%, you might have made $1,753. Note this example does not take into account spread.

 

 

http://www.cnbc.com/2017/03/28/us-consumer-confidence-hits-1256-in-march-vs-estimate-of-114.html

https://www.dailyfx.com/forex/market_alert/2017/03/28/US-Consumer-Confidence-Soars-Yet-Again-Without-the-Backing-of-Hard-Data.html

http://www.news1130.com/2017/03/28/costs-of-protectionism-steep-bank-of-canada-governor-stephen-poloz-says/

http://www.telegraph.co.uk/business/2017/03/29/pound-tumbles-back-124-theresa-may-prepares-trigger-article/

http://www.marketwatch.com/story/fourth-quarter-gdp-raised-to-21-corporate-profits-rise-again-2017-03-30

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