Central Bank rate decisions and US elections to set the market tone
Rates and polls
During the upcoming week key interest rate decisions from the European Central Bank, Swiss National Bank, Bank of Japan, and Bank of Canada headline the economic docket. The European Central Bank rate decision is set to be the highlight of the week for traders and investors, as market participants await the ECB Governing Councils latest thoughts on the European economy, and if any additional policy measures are currently required to encourage economic growth.
This week we also see the release of the latest United States election polls, ahead of the November 3rd election date. The US economy also releases important Inflation, Weekly jobs, GDP, and Housing data. The market participant will also be focused on important GDP, Inflation, and Unemployment figures from the eurozone economy.
Monday 26th October, German IFO Survey
The German IFO Survey is comprised of three components, the Current Assessment Survey, Business Climate Survey, and the Business Expectations Survey. The IFO Survey is a widely observed early indicator of the overall health of the economy. Traders and Investors pay close attention to the IFO Survey, as it can be a leading indicator for current and future trends developing in the German economy.
- The USDCHF pair is only bearish while trading below the 0.9210 level, key support is found at the 0.8990 and 0.8880 levels.
- If the USDCHF pair trades above the 0.9210 level, buyers may test towards the 0.9350 and 0.9480 resistance levels.
Tuesday 27th October, US Durable Goods Orders
The United States Durable Goods Orders is a government report which is released by the US Census Bureau. Durable Goods Orders measures US consumer spending on long-term purchases, products that are expected to last more than three years. Durable goods are generally sensitive to economic fluctuations because durable products usually involve large investments. Consumers becoming sceptical about economic conditions causes sales of durable goods to be among the first to be affected.
- The EURUSD pair is only bearish while trading below the 1.1790 level, key support is found at the 1.1750 and 1.1610 levels.
- If the EURUSD pair moves above the 1.1790 level, key resistance is found at the 1.1900 and 1.2040 levels.
Wednesday 28th October, Bank of Canada Rate Decision
The Bank of Canada Interest Rate Decision is announced by the Bank of Canada and is closely followed by the central banks latest monetary policy statement. If the Bank of Canada is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive for the Canadian dollar currency. If the central bank has a dovish view on the Canadian economy and keeps the ongoing interest rate it is seen as negative for the Canadian dollar.
- The USDCAD pair is only bearish while trading above the 1.3300 level, further losses towards the 1.3000 and 1.2890 levels remain likely.
- If the USDCAD pair trades above the 1.3300 level, buyers may test towards the 1.3400 and 1.3540 resistance levels.
Thursday 29th October, ECB Rate Decision
The European Central Bank's interest rate decision is made by the ECB Governing Council on whether to either increase, decrease or maintain interest rates. The key mechanism behind the monetary policy is the control of interest rates. After the ECB Interest Rate Decision is announced, the European Central Bank holds a lengthy monthly press conference with ECB President Christine Lagarde delivering a prepared statement.
- The EURGBP pair is bullish while trading above the 0.9040 level, key resistance is found at the 0.9110 and 0.9280 levels.
- If the EURGBP pair moves below the 0.9040 level, sellers may test towards the 0.8840 and 0.8650 levels.
Friday 30th October, US Core PCE
US Core Personal Consumption Expenditure is released by the United States Bureau of Economic Analysis and represents an average amount of money that consumers spend in a month. Core PCE excludes seasonally volatile products such as food and energy in order to capture an accurate calculation of the expenditure. It is a significant indicator of inflation. A high reading is bullish for the US dollar, while a low reading is seen as bearish for the US dollar.
- The GBPUSD pair is only bearish while trading below the 1.2920 level, key support is found at the 1.2770 and 1.2650 levels.
- If the GBPUSD pair trades above the 1.2920 level, buyers may test towards the 1.3200 and 1.3310 resistance levels.