The U.S. is printing the Fed’s preferred inflation gauge so you know we’re looking at dollar pairs today!
How do you think USD/CHF will react to the report’s release?
Before moving on, ICYMI, yesterday’s watchlist checked out CAD/JPY’s sideways movement for breakout opportunities. Be sure to check out if it’s still a valid play!
And now for the headlines that rocked the markets in the last trading sessions:
Fresh Market Headlines & Economic Data:
Germany to spend 200B EUR to cap soaring energy costs
China’s yuan snaps eight-day losing streak after strong PBOC warning
Liz Truss to hold meeting with OBR amid market alarm at mini-budget
New Zealand building permits sink 1.6% on month in AugustJapan’s Aug. unemployment rate falls to 2.5% as expected, job availability rises
Japan’s industrial output climbs 2.7% on month (vs. -0.2% expected) in August
Japan’s annual retail sales up from 2.4% to 4.1% in Aug
China’s manufacturing PMI expands (50.1) in Sept vs. 49.4 reading in Aug
China’s non-manufacturing PMI lower from 52.6 to 50.6 in Sept
Japan’s consumer confidence weakens from 32.5 to 30.8 in Sept
UK house prices stagnate for the first time since mid-2021 = Nationwide
French inflation unexpectedly eases by 0.5% as ECB weighs its next move
European shares climb on the last day of painful quarter
Upcoming Potential Catalysts on the Forex Economic Calendar:
Canada’s markets out on bank holiday
UK’s mortgage approvals at 8:30 am GMT
UK’s net individual lending at 8:30 am GMT
Eurozone’s flash CPI at 9:00 am GMT
Eurozone’s unemployment rate at 9:00 am GMT
US core PCE price index at 12:30 pm GMT
Revised UoM consumer sentiment at 2:00 pm GMT
Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️
What to Watch: USD/CHF
If you’ve been too busy watching other dollar pairs, you should know that this week’s dollar selling has pushed USD/CHF from its .9950 resistance zone.
In fact, the pair completed a Double Top pattern around the area and is now trading closer to the .9750 handle.Let’s see if today’s U.S. core PCE price index report can send USD/CHF back to its uptrend.
Word around is that the Fed’s preferred inflation gauge will print a 0.5% monthly gain in August when it only saw a 0.1% uptick in July.
Faster-than-expected price increases will put the spotlight back on the Fed and its members’ plans to stick to multiple interest rate hikes until inflation trends change.
I’m not discounting further dollar losses, however.
Lower-than-expected PCE price readings can accelerate the dollar’s intraweek downswings and drag USD/CHF below its trend line support.
If we see more USD-bearish momentum, then I’ll be on the lookout for possible dips to the .9700 and .9600 previous areas of interest.