Week Ahead – Top Market Events

Date: August 8th– August 12th 

Inflation has dominated the markets so far this year, with staggering Consumer Price Index figures being released all over the world. This weeks attention turns to the most volatile CPI release in the economic calendar this month, U.S CPI.

Will the stock rally hold？

Investors had been downgrading their expectations for the current earnings season. Surprisingly, the reports so far have been mainly positive, with 78% of companies beating Wall Street expectations. Disney, Take-Two, Six Flags, and more companies are due to release their earnings report this week.

Above is the NASDAQ100 chart which has been rallying since June. The gains made during this time are not substantial though, and this is evident by the low volume the rally has been driven by. If the market was to continue its rally, it may find resistance at the 200-day moving average. If volume was to pick up here then the market could be pulled back down to the key lows at 11500.

U.S Inflation

Stealing the show this week is undoubtedly the U.S Consumer Price Index report due on Wednesday. The markets have been shaken this year by the worryingly high inflation figures released in this monthly report. It remains more than three times the Feds 2% target.

The core CPI figure is expected to increase by 0.5% which will make the annual rate 6.1%, a 0.2% increase from June. Optimistic traders will be looking for this report to show inflation has finally ‘peaked’, which could provide more relief to the markets.

Everyone at Zenfinex wishes you the best trading week. If you would like to know more about the products we offer, feel free to visit www.zenfinex.com.

Disclaimer:  Trading Foreign Exchange is highly speculative and may not be suitable for all investors. The leverage created by trading on margin can work against you and losses can exceed your entire investment. Only invest with money you can afford to lose and ensure that you fully understand the risks involved.