FX opening rates on 20.01.2019

Good evening honourable readers and fellow traders.  I hope you had a peaceful and relaxing weekend.
We’re gearing up for another possible biggly week with tomorrow UK PM May’s planned presentation of a new, adapted, improved or straight to the bin Brexit plan. Rumour in the press has it she told her cabinet in a conference call it’ll be something both DUP(on the backstop) and the opposition could agree upon. Remains to be seen. Have a look on our homepage, Ryan posted more updates.The EU is said to split about delaying Brexit, more fun and games that side then.
A Sky poll reveals in the meantime most Brits are opposed to a new referendum .

We’re nearing one full month of US govt partial shutdown. Trump made a proposition yesterday, which got shot down straight away by the Dems. Dems No3 Clyburn made a counteroffer a little while ago to try to unlock the situation. Now Trump is back with some more . Could drag on for a while. Any positive sign should underpin USD and risk, but when? ….

But, first things first. Chinese Q4 2018 GDP (expected to slow down to 6.4% yoy from 6.5% in the prior quarter), retail sales and IP coming out at 2am gmt followed by the National Bureau of Statistics presser. During the week we had all kinds of unconfirmed tariff rumours, China’s PBOC and the whole officialdom implementing liquidity and support measures to counter an evident slowdown, latest an all-in infrastructure sending plan, it should be a market mover. For CNY/CNH but not in the least for NZD and AUD which ended the week on a pretty fragile note.
These last two will see some more important data with NZ CPI on Tuesday evening and AU labour report early Thursday.

The rest of the data week will be spiced up with UK’s employment data on Tuesday, German’s ZEW indicators, Canadian retail sales on Wednesday, European PMI’s on Thursday. We never know which US data may come but in case the shutdown ends soon, expect an avalanche of delayed numbers to start to hit the wires.

That’s not all, we will have BOJ’s monetary policy decision on Wednesday, expecting them to lower CPI expectations, giving them every reason to continue to push very hard on the stimulus accelerator, which should keep USDJPY bid on sib 109 dips till then.
ECB is the other CB honouring us with their policy decision on Thursday. Nothing is expected to change but the data are giving Draghi and friends every good reason to spread their dove wings. My view on EUR is we’re firmly back into the 1.12-1.15 box, I could see a test of the downside again.

And to top off all these goodies we have the decapitated Davos show 22-25 this week. There will be no private dancer( May) and the top crooner(Trump) has also been scrapped from the playlist, shame…. It could leave an open door to China to woo some competitors.

And mixed up within all this will be more earnings across the globe and of course trade again. Never rule out comments, breakthroughs, failures between US-China( by the way here’s an interesting read on what went wrong from China side in the first round) , US-Europe…  the TPP11 came back on the table this weekend by the way as Japan would like others to join.

Here are the FX retail market opening rates. Usual warning about illiquidity in the first few hours of course.
Stay safe and happy hunting in our company again this week. Join us if you want to get realtime analysis pre and on events, data and our positioning on funnymentals and charts.


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