This week, we have three reports on inflation for different currencies. The three currencies we'll be looking at this week are NZD, CAD and GBP. New Zealand is expecting higher inflation this quarter, all of Canada's CPI expectations are lower than last month, and the UK is looking at a 0.1% decrease in their monthly CPI as well.
CADJPY is still a strong bullish reading on the EdgeFinder at +6. Although there isn't much of a bias from the smart money retail side, several other factors point to a higher price move for the month. Take seasonality for example for October; we are expecting one of the most bullish months of the year.
Fundamental factors also take precedent for the pair. Right now there is a strong reading towards CAD on inflation which is currently helping prop up the score. If CPI comes in as expected or lower, however, the pair will lose some of the bullish strength on the inflation reading.
New Zealand is reporting their quarterly number on inflation tonight. It's a similar story to Canada as CPI is expected to drop. If this comes true, we may see some weakness from the kiwi. And vice versa for a higher CPI number.
If we do see a drop in CPI, price may go back under this strong supportive trend line on the 1D timeframe. And a beat in expectations could help price back up to the highs again. The trend line has served as strong support since April of this year.3
This Friday, the UK will announce their latest update on CPI. Canada's situation is much better as the score reflects a strong CAD lean. And if the numbers comes out lower than expected, it will likely further weaken the pair.
Fundamental factors like inflation and jobs are heavily pointing towards CAD strength which is doing better economically. The pair is -4 right now which isn't a strong bearish score. The pair has been in a down trend since July, but seasonality suggests higher moves for the remainder of the year.
Retail shows that the crowd is mostly long on NZD and AUD. They are also short EUR, and CHF. The pound is mostly mixed.
Smart Money Spotlight
Smart money is long only a select few indices while short the rest. JP225, NAS100, NZD and USD are the top four assets from last week's report. NZD is the most longed asset of the three currencies mentioned in this article. GBP was sold last week, and CAD is the second most shorted asset.
Here are the inflation data for GBP, CAD and NZD. The most stubborn of these three currencies is the kiwi which has reported little to no change over the past 4 quarters. GBP suffers from the highest inflation, but CAD is struggling with recent rising inflation rates.
AI- Generated Trading Setups
AI-generated bullish/bearish bias setups on forex currencies, gold, & indices.
Today's economic figures came out in US and Canada. GDP came in higher than expected in Canada while the price of goods purchased by consumers was lower than last month. Here are some pullback ideas for USD and CAD from GDP and PCE numbers. EdgeFinder Analysis NAS100 is a bullish reading on the EdgeFinder still. […]
This week has brought more inflation data with it regarding the USD's PCE and PMI numbers. Powell is also set to speak this Friday about monetary policy going forward. The RBNZ will also release their latest interest rate news tomorrow with expectations of an unchanged rate at 5.5%. EdgeFinder Analysis GBPUSD is a bullish bias […]
This week is a big PMI week for Europe, UK and US. Additional inflationary metrics will add to the overall sentiment of these countries' monetary policies going forward. Here are some setups for the coming week on these currencies. EdgeFinder Analysis GBPCAD is now a +7 on the EdgeFinder as we wait for CPI news […]
DISCLAIMER: All comments made by TraderNick’s Forex Group, LLC are for educational and informational purposes only. All comments should not be construed as investment advice regarding the purchase or sale of any securities or financial instrument of any kind. Please consult with your financial adviser before making an investment decision regarding any securities or financial instruments mentioned by TraderNick’s Forex Group, LLC. TraderNick’s Forex Group, LLC assumes no responsibility for your trading and investment results. All information on any of the platforms utilized by TraderNick’s Forex Group, LLC was obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. TraderNick’s Forex Group, LLC, its employees, representatives, and affiliated individuals may have a position or effect transactions in the securities and financial instruments herein and or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. Trading of any type involves very high risk and may not be suitable for all investors. TraderNick’s Forex Group, LLC, its subsidiaries and all affiliated individuals assume no responsibility for your trading and investment result. Read our full disclaimer here
There is a significant degree of risk involved in trading securities. With respect to foreign exchange trading, there is considerable risk exposure, including but not limited to, leverage, creditworthiness, limited regulatory protection and market volatility that may substantially affect the price, or liquidity of a currency or currency pair. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail client accounts lose money when trading in CFDs. You should consider whether you can afford to take the high risk of losing your money.