Non Farm Payrolls and RBA Interest rate decision next week - 01.10-05.10.18

The focus next week again will be on the USD, as we expect new job data in September. Earlier this week, Jerome Powell advised investors to focus their attention not so much on the central bank's forecasts, but on the real economic data, the first thing we will see is a much greater impact on the publication of the employment report in the next week. Expectations for official data are for a slight decrease in new jobs to 185K compared to 201K in August. If expectations are true, USD will most likely head to new bottoms, wiping out the full growth of the past week.

Technically, the Dollar Index forms a bullish absorbing weekly bar, but below 200SMA, which combines horizontally and 50% Fibonacci on the downward wave, forms a key area of ​​resistance.

In the first few minutes of the next week, the FX market could be extremely volatile, especially for JPY crosses. Over the weekend, we expect China's Country Production PMI data. The index is of utmost importance for the country, with expectations for it to stay above 50.0. It should be borne in mind that commercial tariffs will affect the benchmark for the first time, which can bring it below 50.0. Values ​​below 50 mean that the economy is shrinking. This would send JPY to new peaks and AUD and NZD to new bottoms. It is right at the crossroads of the listed currencies to look for profits in the first hours of the new week.

As for the European equity market, Italy's new budget deficit, which the government has voted on, will continue to have a negative impact, especially in the banking sector that is most affected by the situation. As Italy holds the second largest debt pile in the eurozone - a total of € 2.3 trillion ($ 2.67 trillion), I expect the main stock indexes DAX and CAC to remain under pressure, and short positions to look for in the FTSE MIB (ITA40). Technically, the price activates a double top formation, and the upward correction we observed up to three days ago reached the formation line. The current Price Action is indicative of the fact that investors are fleeing Italian assets, and what is most appropriate at the moment is to wait for a new corrective impulse. Entry short of current levels will be too risky. 50 and 200SMA are already located in the sword and, combined with the lower peaks the index registers, the evidence for a new Short-Trend is available. Shorts look the most appropriate trade at the moment, but we need to wait for a correction to get involved properly.

On Tuesday, we expect RBA's decision on Australia's basic interest rate, where traders do not expect a surprise. In the report following the Central Bank's decision, we will probably not see a change of cautious tone. At present, there is no evidence that trade relations between the US and China will improve, which in turn will continue to deter Australia's central bankers from tightening monetary policy.

Sunday - 30.09.18
04:00 China - Manufacturing PMI
04:00 China - Non-manufacturing PMI
04:45 China - Caixin Manufacturing PMI

Monday
National Holiday in Hong Kong and China
01:30 Australia - AIG Manufacturing PMI
02:50 Japan - Tankan Manufacturing PMI
09:00 Germany - Retail sales
10:15 Switzerland - Retail Sales
10:55 Germany - Manufacturing PMI
11:00 Eurozone - Manufacturing PMI
12:00 Eurozone - Unemployment rate
16:45 USA - Manufacturing PMI
17:00 USA - ISM Manufacturing PMI

Tuesday
National holiday in China
00:00 New Zealand - NZIER Business Confidence
07:30 Australia - RBA Interest Rate Decision
07:30 Australia - RBA Monetary Policy Report
11:30 UK - Construction PMI
19:00 USA - Speech by Jerome Powell, FED Governor
23:30 US - API Crude Oil inventories

Wednesday
Holiday day in Germany and China
03:30 Australia - Building permits
10:55 Germany - Services PMI
11:00 Eurozone - Services PMI
11:30 UK - Services PMI
12:00 Eurozone - Retail Sales
15:15 USA - ADP Non Farm Payrolls
17:00 US - ISM Non-Manufacturing PMI
17:30 US - Crude oil inventories

Thursday
National holiday in China
04:00 Australia - Selling New Homes
04:30 Australia - Trade Balance
15:30 USA - Requests for unemployment benefits
17:00 Canada - Ivey PMI

Friday
National holiday in China
02:30 Japan - Household expenses
04:30 Australia - Retail Sales
09:00 Germany - Factory orders
10:15 Switzerland - CPI
15:30 USA - NFP
15:30 USA - Unemployment rate
15:30 USA - Average hourly wage
15:30 Canada - Unemployment Rate

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