Trading Week Ahead – 2nd-6th December 2019
Key Events This WeekTuesday - RBA Rate Decision - Rate Statement
Wednesday - Australian GDP
Thursday - BOC rate decision Rates statement - Australian Retails sales – Trade Balance – OPEC meetings
Friday - Canadian Employment Data – US Employment Data includes Non-farm payrolls, Average Earnings
US-China Trade Deal
With phase-1 of the trade deal still not over the line how did last week’s bills signed by US President Trump affect this situation? The Chinese government quickly condemned the bills that supported the pro-democracy movement in Hong Kong. Is this a big enough spanner to stall the deal or will both parties continue forward setting up possible new 2019 highs for equity markets?
Oil has seen support last week with traders looking for longer production cuts to continue to support prices. If OPEC comes to the party will we see price finally close back above $58.50 – $59? These levels have held buyers back over the last week. Oil has also been following trade deal updates and its another factor that could play an influence in price. Negative look for declines, positive we have been seeing rallies.
Rate decisions, the BOC has said they’re happy with the current monetary situation, rates are expected to remain on hold. Traders will be looking at the statement for clues on future policy direction. The RBA is expected to hold rates on Tuesday, earlier last week Westpac released a note from Bill Evans suggesting the RBA with cut rates to 25 points by 2020 with QE to follow. This is yet to be confirmed. This makes Tuesdays rate statement a little more interesting.
Chart to Watch
Will we see a continuation of USDJPY strength into the new week? Looking at the current weekly price chart, we can see buyers hit new 6-month highs, maintaining the current medium-term uptrend. One thing to keep in mind is that price remains in a long-term descending triangle consolidation pattern. On the short-term traders will be looking to Tuesdays and Thursdays US PMIs and Friday’s Employment data.