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Weekly Market Analysis 24th June 2024
BY Janne Muta
|June 25, 2024We are set for another action packed week, with numerous high-impact economic events and data releases poised to stir market volatility. Read this report to be ready for the upcoming trading opportunities!
On Tuesday 25th, the focus is on Canada with several crucial inflation indicators. There is the CPI month-over-month, forecasted at 0.3%, down from 0.5%, the Median CPI year-over-year, holding steady at 2.6% and Trimmed CPI year-over-year, slightly down to 2.8% from 2.9%
The Canadian inflation releases are expected to influence the Bank of Canada (BoC) decision in July as after this week there will be only one inflation update before the BoC's rate decision. Gasoline prices are set to lower the year-over-year CPI rate while the Core CPI measures, preferred by the BoC, remain critical. Meanwhile, BoC Governor Macklem will discuss wide-ranging topics, including inflation and upcoming GDP data for April and May will further inform economic assessments. Overall, housing's growing impact on CPI and basket adjustments will likely shape inflation trends and the BoC's response.
Later in the day, the US will release the CB Consumer Confidence index, forecasted to dip to 100.2 from 102.0. Lower confidence figures could weaken the USD, impacting market sentiment in the dollar-denominated markets.
Wednesday kicks off early with Australia's CPI year-over-year data, forecasted at 3.5% and down from 3.6%. This release will be crucial for AUD traders, as lower-than-expected inflation might pressure the Australian dollar.
Thursday brings a flurry of activity starting when Bank of England Governor Bailey speaks, potentially providing direction for the GBP. The US will release its Final GDP quarter-over-quarter data, forecasted at 1.4%, up from 1.3%. Simultaneously, Unemployment Claims are expected to rise slightly to 240K from 238K. Then, the Pending Home Sales month-over-month will be reported, with the previous figure at -7.7%.
The week concludes with the Canadian GDP month-over-month data, previously at 0.0%, and the US Core PCE Price Index month-over-month, expected at 0.1%, down from 0.2%. These figures are crucial for understanding inflationary pressures as some analysts suggest the PCE (Fed's favourite inflation measure) could provide us with a downside surprise.
Here are 3 markets to watch this week
USDCAD
The USDCAD has lost momentum lately after the market was trending higher for the best part of the year. The market is currently trading at last week's low (1.3680) while the Stochastic Oscillator (5.3.3) is oversold. If the support level holds and the market attracts buyers in the proximity of the 1.3680 level, we might see a rally to 1.3750 and then perhaps to 1.3780 on extension. Alternatively, below the 3680 level look for a retest of the bullish regression channel low. If it doesn't hold a move down to 1.3615 could be likely.
EURAUD
The EURAUD is trending lower with the SMA(20) below the SMA(50). The Stochastic Oscillator indicates the market is overbought suggesting it could be vulnerable to renewed selling from trend followers. The last complete 4h candle is bearish with a long wick above the candle body while the high of this candle is somewhat closely aligned with the 23.6% Fib level. Below 1.6125 a move down to 1.6027 could be in the cards while above this threshold level, we should look for a move to 1.6180.
Dow Jones
DJ (Dow Jones Industrial Average) has created higher reactionary lows at 38,281 and 38,742. The latter higher low was formed in a sideways formation that was then resolved to the upside. With both moving averages in the same area we might see buyers defending the level (should there be a retracement back to the level). Based on this it looks like the market remains bullish above the 38,742 level indicating that buyers could actually defend levels above it too. The nearest key (albeit minor) support level is at 39,064 and if the market either tests it successfully or breaks decisively above 39,274 we could see the Dow rallying to the 39,780 - 39,800 range. Alternatively, if the market breaks below the 38,742 level look for a move down to 38,450 or so.
This weeks high impact market events
The following economic events and data releases have the potential to cause considerable price movements, thereby offering you both opportunities and risks. Stay informed and leverage our economic calendar to access real-time data and analysis as these key events unfold.
All times are GMT +3
Tuesday June 25th
| Time | Currency | Event |
| 3:30 PM | CAD | CPI m/m |
| CAD | Median CPI y/y | |
| CAD | Trimmed CPI y/y | |
| 5:00 PM | USD | CB Consumer Confidence |
Wednesday June 26th
| Time | Currency | Event |
| 4:30 AM | AUD | CPI y/y |
| 5:00 PM | USD | New Home Sales |
Thursday June 27th
| Time | Currency | Event |
| 12:30 PM | GBP | BOE Gov Bailey Speaks |
| 3:30 PM | USD | Final GDP q/q |
| USD | Unemployment Claims | |
| 5:00 PM | USD | Pending Home Sales m/m |
Friday June 28th
| Time | Currency | Event |
| 3:30 PM | CAD | GDP m/m |
| USD | Core PCE Price Index m/m |
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While research has been undertaken to compile the above content, it remains an informational and educational piece only. None of the content provided constitutes any form of investment advice.
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DISCLAIMER: TIO Markets offers an exclusively execution-only service. The views expressed are for information purposes only. None of the content provided constitutes any form of investment advice. The comments are made available purely for educational and marketing purposes and do NOT constitute advice or investment recommendation (and should not be considered as such) and do not in any way constitute an invitation to acquire any financial instrument or product. TIOmarkets and its affiliates and consultants are not liable for any damages that may be caused by individual comments or statements by TIOmarkets analysis and assumes no liability with respect to the completeness and correctness of the content presented. The investor is solely responsible for the risk of his/her investment decisions. The analyses and comments presented do not include any consideration of your personal investment objectives, financial circumstances, or needs. The content has not been prepared in accordance with any legal requirements for financial analysis and must, therefore, be viewed by the reader as marketing information. TIOmarkets prohibits duplication or publication without explicit approval.
Janne Muta holds an M.Sc in finance and has over 20 years experience in analysing and trading the financial markets.
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