Weekly Fundamental Forecast for GBP/USD (based on the article)
GBP/USD - "The Bank of England’s (BoE) interest rate decision on May 11 takes center stage as the central bank also presents its updated quarterly inflation report, and the fresh developments may fuel the relief rally in the GBP/USD exchange rate should a growing number of officials show an increased willingness to normalize monetary policy. With that said, market participants may pay increased attention to the slew of Fed speeches on tap for week ahead as a bulk of the 2017-voting members (Minneapolis Fed President Neel Kashkari, Dallas Fed President Robert Kaplan, New York Fed PresidentWilliam Dudley, Chicago Fed President Charles Evans and Philadelphia Fed PresidentPatrick Harker) take to the wires. With Fed Fund Futures now pricing nearly an 80% probability for a June rate-hike, officials may increase their efforts to prepare U.S. households and businesses for higher borrowing-costs, and a slew of hawkish commentary accompanied by a more detailed exit strategy may tame the resilience in Cable especially as the Federal Open Market Committee (FOMC) beings a broader discussions in unwinding the balance sheet."
Weekly Fundamental Forecast for AUD/USD (based on the article)
AUD/USD - "With the US Federal Reserve still happy to suggest that two more US hikes are coming this year, that puts the direction of travel clearly in the greenback’s favor. Then there are commodity prices. These are crucial for the Australian export economy. They too are headed the wrong way for Aussie bulls. As for risks, well, there is a preponderance of Chinese economic data coming up. That may lift the mood a little if it manages to top forecasts. We will also get a look at Australian retail sales, building-approval levels and consumer confidence. Be aware however that domestic data seem unable to sway the Aussie Dollar very far at present unless they smash consensus either way."
Weekly Fundamental Forecast for NZD/USD (based on the article)
NZD/USD - "The central bank will almost certainly keep the official cash rate on hold at 1.75% at its policy meeting on Thursday May 11, though thanks to the stronger-than-anticipated first-quarter inflation figures, it may adjust its OCR forecasts in the accompanying Monetary Policy Statement."
Weekly Fundamental Forecast for GOLD (XAU/USD) (based on the article)
XAU/USD - "The biggest event risk into the open will be the results of the presidential election in France with independent centrist Emmanuel Macron now widely expected to pull out a victory of over Marine Le Pen. The risk to the current downtrend would be an upset victory for Le Pen- a scenario that would lead to uncertainty regarding the future of the Euro project as a whole (also a scenario that would likely offer some near-term support in gold prices). That said, the current technical picture continues to point lower targeting a more meaningful support confluence heading into next week."
Weekly Fundamental Forecast for USD/CNH (based on the article)
USD/CNH - "The PBOC continued to manage liquidity in the financial system in a delicate way, through open market operations. The regulator has reiterated several times that it will keep monetary policy neutral, ruling out a possibility of using easing measures to support the economy before the price bubble risk is fully curbed. The April New Yuan Loans and home loans prints to be released on May 10th will give some update on this. These gauges have been used to evaluate whether excessive cash has flown into the housing sector, where the price bubble risk is seen the most. In addition to the Dollar/Yuan rate, the Bitcoin/Yuan price is worth to keep an eye on as well. On Friday, the BTC/CNY hit a record high after the BTC/USD went on a record-breaking run for a week. Unlike the Japanese regulator that said yes to further Bitcoin development, or the U.S. regulator that said no but keep the door open for a yes, the Chinese regulator sent out a clear signal that China is not ready to have a digital currency to be used widely, even not to have a digital currency invented by itself. These mixed attitudes have Bitcoin exposed to different risks in its three largest markets and in turn elevate its volatility."
Weekly Fundamental Forecast for Crude Oil (based on the article)
Crude Oil - "Fast forward to the first week of May and little appears to be going right for the energy commodity. As of Friday morning, Crude Oil has traded 21.3% lower in 2017 from the opening range high of 2017. Some would call this a bear market as evidenced by a 20% drop. However, when you look at the industry alone, there doesn’t seem to be the panic that the price would indicate. We continue to see bullish call spreads being purchased in the options market in anticipation of eventual price recovery despite short-term downside still favored. Also, CEO of Marathon Oil, Lee Tillman recently noted that from a supply and demand point of view, little has changed as the price has plunged."
Weekly Fundamental Forecast for CAC 40 (based on the article)
CAC 40 - "The election. Will we see a Macron victory as expected or a surprise win by Le Pen? In the likely event we see Macron become the next president of France, a gap higher in the CAC is a reasonable expectation – but will it hold if it does? The CAC finished last week with a sharp rally, rising to its best levels since January 2008. The 7%+ run since the Friday before the first-round election is setting the market up for a ‘sell-the-news’ gap on a Macron victory. If the market gaps up and then fills the void it doesn’t necessarily mean the overall run higher will have come to an end, but a short-term retracement could be in order following a ‘euphoric’ rise. If Le Pen wins? The CAC will likely have the hurts put on it as market participants haven’t priced in such an outcome. The sell-off would likely be quite violent."
Weekly Fundamental Forecast for Dax Index (based on the article)
Dax Index - "Front and center to start the week will be the outcome of the second and final round of the French elections; Macron is a heavy favorite to win. Will the CAC and risk-on respond positively to the ‘expected’ outcome, or will it be a “sell the news” scenario? We’re about to find out. If Le Pen pulls off the upset, it’s safe to say risk markets will be moving in reverse. Looking beyond the election, ‘high’ impact events include Draghi speaking in Dutch Parliament on Wednesday and the release of German 1Q GDP on Friday."
Weekly Fundamental Forecast for S&P 500 (based on the article)
S&P 500 - "Looking ahead to next week, market participants will be reacting to the outcome of the French run-off election between Macron and Le Pen. The futures market will move on developments in European markets. If Macron wins we could see another gap higher as we did following the first-round results. But as discussed above, the ‘gap-n-trap’ scenario could see the CAC 40 fade long before the US open arrives. If that is the case, overnight futures gains could be erased by the time the US open rolls around. It’s just a scenario at this time, but one we’ll be tracking should things unfold in that direction. If Le Pen pulls the surprise victory, a gap-down and sell-off will likely be in play."
USD/CNH Intra-Day Fundamentals: China Trade Balance and range price movement
2017-05-08 04:25 GMT | [CNY - Trade Balance]
if actual > forecast (or previous one) = good for currency (for CNY in our case)
[CNY - Trade Balance] = Difference in value between imported and exported goods during the previous month.
From forextutor article:
USD/CNH M5: range price movement by China Trade Balance news event