Yesterday we had important economic data and there are more equally important releases coming today.
Retail Sales dropped to 0%, compared to 0.6% in the previous month, while analysts were expecting 0.4%. Precisely because consumption in the US has weakened, the economy is likely to slow down even further.
Yes, this is positive for inflation as it could cool down more, but it is also quite likely that we will see an increase in the unemployment rate today at 3:30 PM. Over the past weeks, I have read reports from several large companies that have laid off a percentage of their workforce.
There are also important data releases tomorrow, but I believe that the unemployment rate is the most important indicator of the week. If it comes in above expectations at 4.4%, I expect a correction in the stock market and, consequently, in crypto as well.
If these economic data turn out to be negative, such as consumption and the US unemployment rate, where is the opportunity? Well, if those data are negative, they create downward pressure on the DXY, the US dollar index. As a result, the USDJPY pair would likely decline, while EURUSD would rise.
At the same time, even though the DXY is falling and typically the dollar and risky assets move in opposite directions, in such situations both tend to decline, which creates good shorting opportunities.
In conclusion, if the unemployment rate is announced higher today, expect declines and take advantage of the opportunities.
Retail Sales dropped to 0%, compared to 0.6% in the previous month, while analysts were expecting 0.4%. Precisely because consumption in the US has weakened, the economy is likely to slow down even further.
Yes, this is positive for inflation as it could cool down more, but it is also quite likely that we will see an increase in the unemployment rate today at 3:30 PM. Over the past weeks, I have read reports from several large companies that have laid off a percentage of their workforce.
There are also important data releases tomorrow, but I believe that the unemployment rate is the most important indicator of the week. If it comes in above expectations at 4.4%, I expect a correction in the stock market and, consequently, in crypto as well.
If these economic data turn out to be negative, such as consumption and the US unemployment rate, where is the opportunity? Well, if those data are negative, they create downward pressure on the DXY, the US dollar index. As a result, the USDJPY pair would likely decline, while EURUSD would rise.
At the same time, even though the DXY is falling and typically the dollar and risky assets move in opposite directions, in such situations both tend to decline, which creates good shorting opportunities.
In conclusion, if the unemployment rate is announced higher today, expect declines and take advantage of the opportunities.
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