Weekly Game Plan – 18.10.2015

1. Themes for the week
Official Chinese data (Monday) is expected to reassure markets on the state of the economy. The recent boost in government spending since August, has raised the likelihood that China’s 7% 2015 target will be met.  Of course this will impact risk-appetite and the S&P looks like the place to be for playing risk-on sentiment. NzdJpy and/or AudJpy might also be a good place to look. Vice versa, if data disappoints I would look to the European indices for shorts, and also EurJpy possibly.
 
– Earnings Season to Continue (and this will of course influence equity markets)
–  ECB to stand pat (Thursday), but signal that further QE remains possible.Economic indicators have weakened recently, despite the Euro’s bullish price performance being dictated by momentum-models. Watch the press conference for any further clues…but I still prefer to play Euro weakness on the crosses (vs. Aud, Nzd, Gbp) rather than the major, especially if Draghi leans on the dovish side.
–  US focus remains on FOMC policy differences. No US data on tap this week, but we do have fedspeak Monday, Tuesday and Wednesday to keep us alert. USD poised to be a spectator rather than a protagonist this week.
 
– Bank of Canada to stand pat (Wednesday). UsdCad still one of the stronger currencies out there. Caution before the meeting.
 

2. Charts in line with these themes

SP

NzdUsd

UsdCad

NzdJpy

EurNzd

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