Day Trading Strategy School daily market report…
Shockwaves were felt through the currency markets yesterday due to the SNB (Swiss National Bank) unexpectedly removing its peg against the Euro currency and lowering its deposit rate.
The policy which was put in place over 3 years ago to prevent the Swiss Franc getting too strong against the Euro and hurting the Swiss economy previously ‘pegged’ the Euro to the Swiss Franc exchange rate at a minimum of 1.20.
Now this peg is removed and the Swiss Franc can be traded freely again we could see vast amounts of Swiss Francs being bought in times of uncertainty and volatility as it’s now easier to ‘flee’ to.
The move by the SNB on Thursday is essentially seen as position adjusting ahead of the ECB (European Central Bank) meeting next week on 22nd January where the ECB are widely expected to announce the introduction of some sort of monetary easing to bolster the struggling Eurozone economy.
In other news U.S markets fell for a fifth consecutive session partly due to the SNB decision, a fall in Oil prices and major banks Citigroup and Bank of America missing earnings forecasts.
It hasn’t been a great earnings season for the major banks so far and with Goldman Sachs reporting earnings today before the opening bell could we see a change in fortune or a further upset? Estimated EPS is for $4.29 – $4.48 per share.
Economic Data Releases Today
10:00 GMT, Eurozone Final CPI y/y, Forecast -0.2%.
13:30 GMT, U.S CPI m/m, Forecast -0.3%.
15:00 GMT, U.S UoM Consumer Sentiment, Forecast 94.2.