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Forex Weekly Outlook, Dec 31-Jan 4 – Trading the New Year Week, 2019

Posted Sunday, December 30, 2018 by
Arslan Butt • 2 min read

Howdy, traders.
The trading volumes are assumed to remain light this week due to the Christmas vacation along with New Year holidays as many traders already concluded books before the end of the year. Speaking of the fundamentals, the economic calendar has very little data as most of the financial institutes are closed and will be back in the first week of January 2019.

Despite that, the traders will be trading the current week to price in the month’s most awaited economic figures, the US nonfarm payroll and unemployment rate.

Key Economic Figures This Week

Monday, December 21

The financial markets are closed in observance of New Year’s Eve; however, forex brokers will allow trading activities for limited time periods. The Asian sessions will be open for trading and that’s when China Federation of Logistics and Purchasing will be releasing manufacturing data.

CNY – Manufacturing PMI – The figures are due to come out at 1:00 (GMT) with a neutral forecast of 50. For your info, it’s a survey of 3k purchasing managers which asks respondents to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories.

Tuesday, Jan 01

All of the financial markets will be closed in observance of New Year’s Day.

Wednesday, Jan 02

GBP – Manufacturing PMI – At 9:30 (GMT), Markit will release the manufacturing figures for the United Kingdom. Economists are expecting a slight drop from 53.1 to 52.6. But the PMI data is still above 50, which is the minimum threshold to determine the economic growth. Above 50.0 indicates industry expansion, while below indicates contraction for an economy.

Thursday, Jan 03

USD – ADP Non-Farm Employment Change – The Automatic Data Processing, Inc. will be releasing the ADP Non-Farm Employment Change at 13:15 (GMT). It’s expected to rise from 180k vs. 179k in the previous month.

The ADP figure is mostly correlated with the Non-farm payroll and it’s often called advance NFP. The positive forecast is likely to underpin the buck until the release of the news. Whereas, the actual ADP will give us clues about labor market figures due on this Friday.

USD – ISM Manufacturing PMI
At 14:00 (GMT), the Institute for Supply Management is expected to release the manufacturing purchasing managers index. The forecast of 58.2 represents robust growth but is weaker than 59.3 beforehand.

Friday, Jan 04

Here comes the most awaited day of the month. On this day, investors’ focus will remain on the US NFP (Non-Farm Employment Change) and unemployment rate.

USD – Labor Market Report – The Nonfarm employment change is one of the most awaited and watched economic data of the month. Exactly like the ADP data, the NFP is also expected to add 181k jobs vs. 155k during the previous month.

However, the unemployment rate is expected to remain unchanged at 3.7%. If this really happens, we may see a nice buying in the dollar and sell-off in gold. Better than expected figures affirm the sentiments that Powell will continue to hike the interest rates in 2019.

All the best traders and be careful with your trades as the market can remain unpredictably volatile due to public holidays. Stay tuned to FX Leaders for exciting trade setups and forex trading signals.

Have a blessed year in 2019.

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