Currencies Trader
Author: jeepsontrading
Two Weeks to Next Event
Trading activity will be minimal during the Christmas break.
The next activity is the ADP Non Farm Payrolls at on Jan 3 2019. This is an LLA so will be overshadowed by the HLA, Unemployment Rate the day after, on Jan 4.
Trading plans going into these events will made a day or two before.
Merry Christmas and a Happy New Year.
Jeepson Trading
United States Economic Analysis
Jeepson Trading have a unique method to determine the performance of an economy. This method is two form, firstly high level analysis which looks at the key indicators. And then, low level analysis which is an analysis of the indicators of the central bank’s focus area.
High Level Analysis
High Level Analysis (HLA) is the process of analysing the key indicators of an economy and determining the subsequent performance. The key indicators are as follows;
- GDP Growth Rate
- Unemployment Rate
- Inflation Rate
- Interest Rate
- Balance of Trade
- Government Debt to GDP
The individual performance of each indicator is analysed over a twelve month period to determine the the high level economic performance.
Central Bank
The Federal Reserve is the central bank of the united states who has a dual mandate to maintain price stability and achieve maximum sustainable employment.
At their previous meeting on November 8 they stated that the focus areas are the labour market and inflation. These can be monitored by reviewing the performance of the Significant Indicators (SIND).
Low Level Analysis
Jeepson Trading have identified the following SIND that are to be monitored for the low level analysis.
Labour
- Non Farm Payrolls
- ADP Non Farm Payrolls
- Average Hourly Earnings
Inflation
- Producer Prices Change
- Core Inflation Rate
- Inflation Rate Month on Month
High Level Analysis 
Low Level Analysis
Conclusion
High Level Analysis: strong economy with an improving outlook
Low Level Analysis: strong indicators with an improving outlook
BUY from the Support levels of Technical Analysis.
US GDP Growth Rate
Even though there has been a mix of data, the trend has been improving over the previous twelve months.
The release due on November 28th is expected at 3.50 percent which will maintain the uptrend.
Fundamental and Geopolitical Analysis
Central Bank focus points
measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments
- No other significant news events at this time
Sentiment Analysis
- Dollar is in a bullish period over the previous week
Order
Orders to buy are good at appropriate levels determined by Technical Analysis here
Image credits: Aron Van de Pol
Buy US Dollars
High Level Economic Analysis
The Federal Reserve are planning to raise interest rates again and a decision to do so is based on the performance of Labour and Inflation.
On review, the SUIN are in great shape and support buying the US Dollar.
Low Level Economic Analysis
The SIND have been identified based on the focus of the Federal Reserve.
All indicators are performaing well and I expect the Inflation Rate Month on Month is being closely monitored. Should this show a strong result then a December hike is highly likely.
On review, the SUIN are in great shape and support buying the US Dollar.
Technical Analysis
Live charts can be viewed here
United States Economy Improving
There are six indicators that are used to judge the performance of an economy:
- GDP Growth Rate
- Unemployment Rate
- Inflation Rate
- Interest Rate
- Balance of Trade
- Government Debt to GDP
Balance of Trade and Government Debt to GDP are the only two that have worsened over the previous twelve months.
The Federal Reserve are monitoring the labour market and inflation to decide on further rate hikes. Fed fund futures have over 70 percent probability that a hike is happening, however this has dipped from over 75 percent.
Photo by David Everett Strickler on Unsplash
