Amplify Trading Weekly Strategy: 20th - 24th January 2020

Amplify Trading Weekly Strategy: 20th - 24th January 2020

CALENDAR HIGHLIGHTS


MondayUS Market Holiday (Martin Luther King Jr Day), JN Industrial Production, Capacity Utilisation, CN Policy Rate (Loan Prime Rate), FDI, UK Rightmove House Price Index, House of Commons Report Stage on EU Withdrawal Bill, WR IMF World Economic Outlook Update from Davos


TuesdayJN BoJ Interest Rate Decision, UK Unemployment Rate, Employment Change, Average Earnings, GE ZEW Economic Sentiment, 2-yr Auction, CA Manufacturing Sales, NZ GDT Price Index, UK Lords Report Stage on EU Withdrawal Bill, US President Trump Impeachment Trial Resumes, Trump Speaks at Economic Forum in Davos, US Earnings: Netflix


Wednesday: AU Westpac Consumer Sentiment, FR Business Survey, IT Industrial Sales, New Orders, UK PSNB, Gross Mortgage Approvals, CBI Industrial Trends Orders, US Chicago Fed National Activity, House Price Index, Existing Home Sales, Weekly API Inventories, CA BoC interest Rate Decision, CPI, Wholesale Sales, WR Economic Forum in Davos


Thursday: JN Trade Balance, Leading Index, AU Unemployment Rate, Employment Change, SP 10-yr Auction, EU ECB Interest Rate Decision, Press Conference, Consumer Confidence, US Weekly Jobless Claims, Leading Index, KC Fed Manufacturing Index, Weekly DoE Inventories, NZ CPI, AU Manufacturing/Service PMI, WR Economic Forum in Davos (Angela Merkel), US Earnings: P&G, Intel


Friday: JN National CPI, Manufacturing PMI, CN Holiday, FR/GE Manufacturing PMI, IT Trade Balance, GE Ifo Business Climate, EU/UK/US Manufacturing /Service PMI (P), CA Retail Sales, WR Economic Forum in Davos (ECB's Lagarde, BoJ's Kuroda, US Treasury Secretary give Global Economic Outlook), US Earnings: Amex


**During the upcoming week, 58 S&P 500 companies (including six Dow 30 components) are scheduled to report results for the fourth quarter.


MACRO OVERVIEW - Anthony Cheung, Head of Market Analysis (@AWMCheung)


The two main geopolitical topics that drove market sentiment from the beginning of the year (China and Iran) have now passed, with attention turning back to central banking as the Bank of Japan, People's Bank of China, European Central Bank and Bank of Canada all announce their latest policy decisions. Despite the all-star line-up no great changes are foreseen with eyes mainly on the official launch of the ECB's monetary strategy review on Thursday.


Meanwhile, the world's top luminaries convene at the World Economic Forum in Davos this week. Although this will dominate the news networks, and the possible Trump-Greta clash might make for some compelling TV, I'm not expecting anything groundbreaking. Interestingly, but perhaps unsurprisingly, the day Trump is scheduled to deliver his headline speech is the same day his impeachment trial resumes on Capitol Hill, so you can expect the usual diversion and deflection tactics to be deployed by the President.


Back to the UK and Brexit headlines are likely to re-emerge this week as peers vote to amend the EU Withdrawal Agreement Bill in its report stage. This is not an attempt to block but rather question details with market participants more focused on the growing likelihood of a Bank of England rate cut on the 30th of January. The CME's BoEWatch tool now shows a 72% probability of a 25bps rate cut, up over 50% in less than 10 days following a series of weak economic data and dovish speak from the MPC.


WTI crude futures have seen a gap higher at the open following disruptions to production in Iraq and Libya. The Iraq situation is due to employment issues with security personnel at key facilities, while Libya continues to suffer from civil unrest which this time has limited the country's production to 72kbpd, down from more than 1.2mbpd on Saturday.


During the upcoming week, 58 S&P 500 companies (including six Dow 30 components) are scheduled to report results for the fourth quarter. Highlight will be Netflix, who is the first of the FAANGs to report this season. Options imply a 7.6% swing in the stock which is under growing pressure from Disney+ and Apple's new streaming service.  


You can replay the entire market briefing filmed earlier today HERE.



TECHNICAL OVERVIEW - Sam North, Senior Associate (@snorth19)


S&P 500 futures



WTI crude futures



EUR/USD futures



GBP/USD futures



Have a great week ahead.


Regards,


Amplify Team



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