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Weekly Market Outlook – 29/05/16

Weekly Market Outlook – 29/05/16

The Federal Reserve The Federal Reserve The Federal Reserve The Federal Reserve is the Central Bank of the United States of America and sets the monetary policy When used by traders and investors monetary policy When used by traders and investors monetary policy When used by traders and investors monetary policy usually refers to Central Bank policy concerning ... More usually refers to Central Bank policy concerning ... More usually refers to Central Bank policy concerning ... More ... More is the Central Bank of the United States of America and sets the monetary policy... More is the Central Bank of the United States of America and sets the monetary policy... More has done a good job of continuing to make its point regarding a possible interest rate hike. It is not clear when an increase will happen. The Fed The Federal Reserve is the Central Bank of the United States of America and sets the monetary policy... More will hold its FOMC Statement on June the 15th. While that date is still two weeks ahead, the shadow of the Fed The Federal Reserve is the Central Bank of the United States of America and sets the monetary policy... More has cast a cloud over the FX markets and is causing light storms. The USD The USD The USD is the official currency of the United States of America. It is the largest reserve currency... More is the official currency of the United States of America. It is the largest reserve currency... More traded stronger versus the EUR The EUR The EUR is the official currency of the European Union. Presently 19 out of the 28 collective  nati... More is the official currency of the European Union. Presently 19 out of the 28 collective  nati... More this past week and it will be more than interesting to see how the EUR/USD pair moves in the days ahead.

U.S. data on Friday continued to show that the American economy is not spectacular. Preliminary GDP results before going into the weekend met expectations, but with only a gain of 0.8%. Also the Revised U of M Consumer Sentiment reading actually came in below its estimate. This week’s coming highlight for U.S. data will certainly be the Non-Farm Employment Change numbers on Friday. However, there will be plenty of other data from the States and internationally that will affect the broad markets all week long.

Retail Sales numbers will come from Japan early on Monday and this will be followed by German inflation In economics the term inflation In economics the term inflation In economics the term inflation refers to price values that are rising on a regular basis in which t... More refers to price values that are rising on a regular basis in which t... More refers to price values that are rising on a regular basis in which t... More figures and French Consumer Spending. The U.S. will be on holiday this Monday with its Memorial Day observance. On Tuesday German Retails Sales are on schedule and from the States the CB Consumer Confidence reading will be released. Asian markets will be nervous this week.

Early on Wednesday China will present Manufacturing PMI readings. The U.K. and U.S. will also issue Manufacturing PMI data on the same day. Thursday the ECB The European Central Bank The European Central Bank, ECB The European Central Bank, ECB, is the Central Bank of the European Union and sets the monetary poli... More , is the Central Bank of the European Union and sets the monetary poli... More , ECB, is the Central Bank of the European Union and sets the monetary poli... More Minimum Bid Rate will be announced, and it will be followed by the start of the jobs data from the States via the ADP report and weekly Unemployment Claims.

Traders saw the USD get stronger against the EUR, and actually lose value to the GDP last week. Investors are increasingly cautious as they weigh their sentiment regarding a potential Fed hike. Comments from the Fed themselves makes it appear a July hike is more likely, but the USD has essentially traded stronger based on the notion that the Greenback The USD is the official currency of the United States of America. It is the largest reserve currency... More will soon be offering a higher interest rate compared to most other major currencies. The question likely being asked by traders now is if too much value has been put into the USD.  The Brexit vote also continues to near and this may make some GBP The GBP The GBP is the official currency of the United Kingdom. The GBP is a major currency and currently ra... More is the official currency of the United Kingdom. The GBP is a major currency and currently ra... More traders nervous, but if investors feel the U.K. will stay in the E.U. it lends itself to opportunities for the Sterling The GBP is the official currency of the United Kingdom. The GBP is a major currency and currently ra... More – the vote is on June 23rd.

Wall Street turned in gains last week, but many investors are continuing to look at the major Indices with suspicion. Questions continue to linger about the global economy and recent news via highly regarded analysts suggests that China’s economic rebound which has been held up as a positive sign by some is starting to lose steam as stimulus from the government decreases.

Europe continues to struggle with is broad economy, but it seems unlikely that the ECB will make any major changes to its monetary policy this week. Both the ECB and Fed do need to have a clear picture of what is going to happen in the U.K. via the Brexit vote, this because there would be economic ramifications for all major economic spheres considering international monetary policy if the U.K. were to surprise everyone and decide to leave the European Union.

Crude Oil also will be watched by many this week. Crude Oil has done remarkably well the past couple of months climbing back from lows. However the commodity has had a difficult time seeing WTI Refers to West Texas Intermediate Refers to West Texas Intermediate Refers to West Texas Intermediate which is often the actual physical resource that the asset Crude O... More which is often the actual physical resource that the asset Crude O... More which is often the actual physical resource that the asset Crude O... More trade above $50.00 USD. Quite a bit of resistance When investors and traders use the term resistance When investors and traders use the term resistance When investors and traders use the term resistance, or resistance level, they are often speaking abo... More , or resistance level, they are often speaking abo... More , or resistance level, they are often speaking abo... More seems to be holding Crude Oil back from sustaining its climb and traders may test highs made in these known ranges and wager on pullbacks.

Going into this week of trading there may be many who are looking at the USD as a potential opportunity to trade via technical The use of the term technical The use of the term technical The use of the term technical in trading usually refers to a variety of methods in which a trader or... More in trading usually refers to a variety of methods in which a trader or... More in trading usually refers to a variety of methods in which a trader or... More ranges short-term. Risk management must be used while trading and a keen set of eyes and strong stomach would be useful too. The CB Consumer Confidence reading on Tuesday from the States will be a good early test and an interesting barometer for the remainder of the week.