US Retail Sales Up Next
The key data focus today (and of this week) will be the release of US retail sales for October. On the back of last week’s bumper US inflation data for the same period, the release is attracting more attention than usual and therefore has the potential to create plenty of market volatility.
In terms of the figures, the market is looking for both sets to improve. Headline retail sales are forecast at 1.3% from 0.7% prior while core retail sales are forecast at 1% from 0.8%. Should market consensus be satisfied the US Dollar is likely to remain bid. However, if we see an upside beat, this is likely to cause the most movement with a firm USD upside response and a firm downside response in risk assets.
Where to Trade US Retail Sales?
USDJPY
With the BOJ committed to maintaining an easing presence and with expectations of a sweeping new Japanese fiscal stimulus package, the divergence with the Fed and US monetary policy looks likely to keep USDJPY on an upward path medium term. Any USD upside from strong data today will likely see a break of the 114.70 highs where bulls can target 115.45 and 116.07 as the bull channel continues. The retail market is currently around 85% short, suggesting plenty of room for this move to continue higher.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.