Weekly Market Commentary | 12.08 - 18.08

Monday:

• The week kicks off on a very quiet note. With no Tier 1 data scheduled, markets are expected to be relatively calm. Adding to the stillness, the Japanese markets are closed in observance of Mountain Day. Traders might use this time to position themselves ahead of the more eventful days later in the week.

Tuesday:

• Tuesday brings a bit more action, starting with the Wage Price Index from Australia, which is expected to come in at 0.9%. This could set the tone for AUD pairs early in the session. Following this, the UK will release its claimant count change, which could influence the GBP. The day wraps up with the U.S. PPI inflation data—not as crucial as the CPI, but still worth noting for its potential impact on market sentiment. Also on the docket is the earnings report from HomeDepot, which will be released before the market opens and could influence the retail sector.

Wednesday:

• Wednesday is shaping up to be the most exciting day of the week. The spotlight will be on the interest rate decision from New Zealand, where rates are expected to hold steady at 5.5%. The UK will also release its inflation data, expected to rise to 2.3%, which could stir the markets. But the real star of the day will be the U.S. CPI data, with an annual expectation of 3%. This report is likely to set the tone for the markets globally. After the market closes, keep an eye out for Cisco’s earnings, which could add some after-hours volatility.

Thursday:

• Thursday maintains the momentum with job data from Australia, which could shake up the AUD. The UK will release its GDP figure, expected to inch up by 0.1%, and the U.S. will report on retail sales, expected to grow by 0.4%. Retail sales could be a key driver for the day, influencing both market sentiment and the dollar. In the earnings calendar, all eyes will be on Walmart’s report, released before the market opens, which could provide insights into consumer behavior and economic health.

Friday:

• The week winds down on Friday with a speech from Reserve Bank of Australia Governor Bullock, which could provide clues about future monetary policy down under. The key data of the day will be retail sales from the UK, expected to rise by 0.6%. This figure will be closely watched, especially after the week’s earlier inflation and GDP data from the UK. The markets might also see some positioning ahead of the weekend as traders digest the week’s events.

Setups for This Week:

EUR/CHF

• Primary View: The price is in a downtrend but is currently undergoing a bullish correction. As long as the price remains below the yellow resistance and the red downtrend line, the sentiment remains negative.

• Alternatively: A break above these two resistances would signal a buy opportunity.

Sugar

• Primary View: The price is currently in a descending triangle pattern. Recently, the price bounced off the horizontal support, but this pattern typically suggests a breakout to the downside.

• Alternatively: A break above the red downtrend line would signal a potential buy opportunity.

S&P 500

• Primary View: The price is experiencing a bullish correction, forming a wedge pattern, and is currently below a key orange horizontal resistance. As long as the price stays within the wedge and below the resistance, the sentiment is negative, and a breakout below the wedge's lower line is more probable.

• Alternatively: A break above the upper line of the wedge and the orange horizontal resistance would indicate a buy signal.