Prepare For High Volatility In The Forex Market

Prepare For High Volatility In The Forex Market

This week has started with a shortage of the US dollar. Investors went for riskier currencies (Euro, Cable, Aussie, Kiwi, etc.), from the first hours of trading. The stock indices continued to trade sideways while gold and silver had a pretty interesting jump, but did not keep the gains.

This week can get very interesting starting with tomorrow. In the table below you will find the economic indicators that might have the highest impact on the Forex market and will be published in the economic calendars.

Date Currency Forecast Previous
TueNov 5 AUD Cash Rate 2.50% 2.50%
AUD RBA Rate Statement
JPY BOJ Gov Kuroda Speaks
CHF CPI m/m 0.10% 0.30%
GBP Services PMI 60.4 60.3
USD ISM Non-Manufacturing PMI 54.2 54.4
NZD Employment Change q/q 0.50% 0.40%
NZD Unemployment Rate 6.20% 6.40%
WedNov 6 AUD Trade Balance -0.51B -0.82B
GBP Manufacturing Production m/m 1.20% -1.20%
CAD Building Permits m/m 7.80% -21.20%
CAD Ivey PMI 54.7 51.9
ThuNov 7 AUD Employment Change 10.3K 9.1K
AUD Unemployment Rate 5.70% 5.60%
GBP Asset Purchase Facility 375B 375B
GBP Official Bank Rate 0.50% 0.50%
GBP MPC Rate Statement
EUR Minimum Bid Rate 0.50% 0.50%
EUR ECB Press Conference
USD Advance GDP q/q 1.90% 2.50%
USD Unemployment Claims 332K 340K
EUR ECB President Draghi Speaks
FriNov 8 AUD RBA Monetary Policy Statement
CNY Trade Balance 23.5B 15.2B
CAD Employment Change 15.3K 11.9K
CAD Unemployment Rate 7.00% 6.90%
USD Non-Farm Employment Change 126K 148K
USD Unemployment Rate 7.30% 7.20%
USD Prelim UoM Consumer Sentiment 74.6 73.2
USD Fed Chairman Bernanke Speaks
SatNov 9 CNY CPI y/y 3.30% 3.10%
CNY Industrial Production y/y

By far one of the most important days is Thursday. Australia will announce its Employment Change and Unemployment Rate, but the main events are the MPC Rate Statement and the Minimum Bid Rate for the ECB, followed by the ECB press conference. And if this it isn’t enough, the United States will release their advanced GDP and Unemployment Claims.As you can see RBA will publish its cash rate and statement, Switzerland will release the CPI, Great Britain will have the Services PMI, United States will publish the ISM Non-Manufacturing PMI and New Zealand will announce it employment change and unemployment rate. Wednesday Australia will publish the Trade Balance, for Great Britain it will be released the Manufacturing Production and for Canada the Ivey PMI and Building Pemits.

Friday the party will continue with the RBA Monetary policy, China’s Trade Balance, the Canadian Unemployment rate and the well-known Non-Farm Employment Change, which Federal Reserve is observing closely, and Unemployment rate. The day will end with a speech from Fed Chairman, Ben Bernanke.

The week will end with the Chinese CPI and Industrial Production on Saturday.

high volatility week

During the publishing of these indicators and events the volatility will rise for the Forex Market, but not only. If there will be surprises from the Central Banks, changes in their Monetary Policy or big differences between the forecast values and the actual values of the indicators, we can expect for interesting moves.

It is recommended for traders to adjust their trading strategy for high volatility and also to reconsider their money management so that losses can be stopped as soon as possible.

 

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