Trading Plan
Baseline
Short-Term Sentiment Bias:
- Euro under pressure, trading below $1.05 due to ECB rate cuts and political uncertainty in France and Germany.
- Markets expect an additional 50 basis points cut by February.
Upcoming Risk Events:
- German Manufacturing PMI (Dec): Previous: 43.0, Consensus: 43.1.
- German Services PMI (Dec): Previous: 49.3, Consensus: 49.5.
- Eurozone Flash Manufacturing PMI: Previous: 45.2, Consensus: 45.3.
- Eurozone Flash Services PMI: Previous: 49.5, Consensus: 49.5.
Surprise:
Positive Surprise:
- Outcome: PMI beats expectations.
- Trade: Long EUR/CHF (bond yield spreads suggest upside).
Negative Surprise:
- Outcome: PMI misses expectations.
- Trade: Quick scalp on EUR/NZD (slight downside based on bond yield spreads).
Bigger Picture
Macro-Fundamental Bias
- ECB's Stance: Data-dependent approach, removed restrictive rate stance.
- Inflation Outlook: Headline inflation projected to average 2.4% in 2024, decreasing to 1.9% by 2026.
- GDP Revisions: Lowered to 0.7% in 2024 and 1.1% in 2025.
- Market Expectations: Continued rate cuts expected due to weak growth and low inflation.
Baseline
Short-Term Sentiment Bias:
- Euro under pressure, trading below $1.05 due to ECB rate cuts and political uncertainty in France and Germany.
- Markets expect an additional 50 basis points cut by February.
Upcoming Risk Events:
- German Manufacturing PMI (Dec): Previous: 43.0, Consensus: 43.1.
- German Services PMI (Dec): Previous: 49.3, Consensus: 49.5.
- Eurozone Flash Manufacturing PMI: Previous: 45.2, Consensus: 45.3.
- Eurozone Flash Services PMI: Previous: 49.5, Consensus: 49.5.
Surprise:
Positive Surprise:
- Outcome: PMI beats expectations.
- Trade: Long EUR/CHF (bond yield spreads suggest upside).
Negative Surprise:
- Outcome: PMI misses expectations.
- Trade: Quick scalp on EUR/NZD (slight downside based on bond yield spreads).
Bigger Picture
Macro-Fundamental Bias
- ECB's Stance: Data-dependent approach, removed restrictive rate stance.
- Inflation Outlook: Headline inflation projected to average 2.4% in 2024, decreasing to 1.9% by 2026.
- GDP Revisions: Lowered to 0.7% in 2024 and 1.1% in 2025.
- Market Expectations: Continued rate cuts expected due to weak growth and low inflation.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.