It’s Trump’s last days as POTUS!
Will we see a smooth transition? More importantly, how will traders react to this week’s likely crazy headlines?
If you’re planning on trading the dollar in the next coupla days, then you’ll want to
- President-elect Biden will officially be POTUS on Wednesday noon
- Civil unrest aside, traders expect a smooth transition process
- Keep an eye out for some Trump impeachment drama as the Senate returns to session on Tuesday
- Former Fed Chairman Janet Yellen will have her confirmation hearing on Jan 19 where we can get clues on her policy biases as Treasury Secretary
Lower-tier economic releases
- Initial jobless claims (Jan 21, 1:30 pm GMT) is expected to print at 915K after spiking to 965K
- Markit’s manufacturing PMI (Jan 22, 2:45 pm GMT) to slip from 57.1 to 56.0?
- Markit’s services PMI seen weakening from 54.8 to 54.3
- Existing home sales (Jan 22, 3:00 pm GMT) could dip by another 1.0% after 2.5% decline in November
Overall dollar demand
- Unless we see fresh market themes, the dollar could continue to edge higher against its counterparts after vaccine optimism has been priced in and traders start worrying about longer-term recovery prospects
- Policy announcement from the BOC, BOJ, and ECB could re-energize easy policy celebrations and drag the safe-haven dollar lower
- Stochastic is showing the dollar’s overbought conditions against the euro and franc
- USD looks headed towards oversold levels against GBP, AUD, and CAD
- EMAs reflect the short-term demand for the dollar
- Watch out for retracement or reversal setups on AUD/USD and GBP/USD
- The dollar was most volatile against the comdolls and the pound in the last seven days