Here we are on an autumn Monday morning. Japan is off today for Health-Sports Day (wish we had some more of these holidays) , North America is on holiday as well for Columbus Day, the economic data today is almost non-existent and the weather outside my window is pretty gloomy, which makes this a perfect day for market analysis.

Dou you need more reasons? That´s all I got so let´s not waste any more time and get started with the economic events which have the potential to move the forex market.

• German ZEW Economic Sentiment – Tuesday

The German economic sentiment has been very disappointing in the last three months. The ZEW indicator declined to -6.8 points in June, which shows pessimism. It got back above the 0 level, but at 0.5 points in July and August, I can´t see much optimism.

In the last few weeks, we have seen some improvement in the European data which indicates a turnaround after a long period of stagnation, so maybe we might be on for a surprise. The German numbers are expected at 4.2 points this time, while the Eurozone economic sentiment is expected at 6.3 points.

This might be the biggest market mover in normal times, but the 100 pip jump in the Euro last week after a few comments from an unconfirmed ECB (European Central Bank) member about tapering, which were later denied by Draghi, shows that the market is very excited.

A jump in the economic sentiment would be an additional signal that just maybe, the Eurozone economy has started to drag itself out of the woods. A few of these signals and the market will really start believing that the ECB might begin to reduce the asset purchase (tapering). EUR/USD jumped more than 100 pips on some speculation last week, now imagine the boost this will give the Euro. These sorts of numbers set the market sentiment in the long term, that´s why we keep an eye on them.  

• FED Members Dudley and George – Wednesday

Dudley and George are due to impose their wisdom on us on Wednesday afternoon. We have the US JOLTS job openings and the FOMC meeting minutes as well in the same day, but nothing dramatic is expected to change in the labour sector and the minutes from the last FED meeting are already outdated. We already know what they discussed there.

So Dudley and George will take all the attention that day. The FED made a strong case for a rate hike soon, and the odds for a hike in December stand at nearly 60% now. If these two cheeky chaps reinforce the idea of a rate hike then we will most likely see the USD get some bids for a couple of sessions. 

If they decide to go further and be even more hawkish and remove the "gradual rate hike pace" phrase from their speeches, then the market might take that as a sign that the path of future rate hikes might not be so gradual after all. That would make the Dollar surge. I don´t expect them to be dovish, but you never know. 

These are the first two important events this week. We will cover the rest of the week later today, so check us back to see what´s coming up next this week.