The Week Ahead: Daily Fundamental Agenda 05-09 January


The week ahead. Weekly SummaryIt is that time of the year once again, January. It is time for the analysts to pull out their crystal balls and speculate market developments for 2015. 2014 proved that it is not quite easy to predict what is coming up for the year, as markets served traders and investors a number of surprises throughout the year.

2015 itself does not seem less surprising as the market already wowed everyone for the first trading day of the year. USD being stronger than expected, Oil prices down by almost 40% in less than half a year, China and Europe struggling  we are off to a challenging 2015 here. And the first challenge we have is the Greek elections which puts the European austerity measures under question mark.

For the first full trading week of 2015 we have a full calendar.Daily Fundamental Agenda follows:

On Monday, January the 5th, is going to be dominated by the German fundamentals. As Germany is the engine of the European Union, any surprise here generally is not welcomed by the markets. Analysts expect an increase in German November Retail Sales and December CPI.

There is also Spanish Unemployment claims data to be announced at 8:00 am GMT where analysts expect to see development from the Spanish employment market.

In UK though the Construction PMI is expect to drop by 0.2 point, which is a negative data for the cable. May the actual results be below the forecasts we may expect the GBP/USD pair drop below 1.5330 support zone of August 2013.

On Tuesday, January the 6th, the trading day starts with the Australian trade balance, where the data is expected to drop to -1.59B vs. -1.32B previously. Meanwhile, troubling Chinese economy’s HSBC Services Purchasing Managers’ Index (PMI) is going to be announced in China. Aussie standing at its 0.8090 support zone at the time of analysis, if these two data comes worse than expected we could easily see the AUD/USD pair test or break its 0.80 psychological level as the Australian Economy is highly dependent in its Chinese neighbors’ economic indicators too as a close economic partner.  Furthermore, these data could potentially create volatility in commodities market as well.

In Europe it is Bank Holiday in Italy and in the UK it is Services PMI day. UK’s PMI data is forecasted to increase by 0.3 points.

In the US we will have the ISM Non-Manufacturing PMI data to be announced, which is expected to fall. May the results surprise markets in either direction we may see volatility in USD pairs.

On Wednesday, January the 7th, December unemployment levels for Germany, Italy will be covering the headlines with the aggregate EU CPI  data. As Europe keeps struggling, and Mario Draghi commented that the ECB is reviewing the market developments taking the oil prices into account in his last press conference this data could put Euro under stronger pressure for now.

In the US we will have the November Trade Data, the Crude Stock levels announcement by the Energy Information Administration and the ADP Employment figures announced.

However the most anticipated announcement is the FOMC meeting minutes for the last meeting of 2014, where investors are expecting a tone change in the FED’s language and hints for the rate hikes. It is also worth mentioning that in the last press conference Janet Yellen mentioned “in a couple of meetings” with regard to the rate hike which falls into April 2015.

On Thursday, January the 8th, German factory orders and Eurozone PPI data will start the European session. Meanwhile the Bank of England will be announcing official Bank Rates where the BOE is expected to hold the interest rates as is.

In the US investors will be following the unemployment claims data as there was a surprise increase in the 4th week of December .

On Friday, January the 9th, the week will be finalized in Asia with the Chinese CPI and PPI data and in Australia with the Retail sales. Overall we will be expecting volatility picking up for NZD, AUD pairs and for the commodities once again.

In Europe we will have the UK, French and German November trade and industrial output data announced.

However the pip tsunami is expected to take place with the US NFP (Non-farm Payrolls) figures. Analysts expect to see moderate growth in the employment and the 5.7% unemployment rate slightly dropping. May the expectations be exceeded, USD is likely to get even stronger across the board.

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