People have oftentimes used some variation of the expression "Hold on to your hat!" to warn someone of a surprise. Predicting when a headline figure from an economic report or a comment by a central banker will be perceived by financial markets as a surprise can be as difficult as forecasting the weather in some parts of the world. Yet with so many notable events on the Tuesday 17 July news calendar, I'm compelled to advise currency traders to hang on to their hat during tomorrow's London and New York morning sessions.
Although each one of the first four could prompt the pertinent currencies to flinch temporarily, I see Ben Bernanke's Humphrey-Hawkins testimony to the US Senate Banking Committee as Tuesday's feature news event. I would not be surprised to hear Bernanke mention the US central bank's readiness to act if the US economic picture deteriorates significantly, but I'm anticipating that current conditions do not yet warrant any hints from the Fed Chairman of policy easing at the FOMC's next meeting starting 31 July.
Join us here as we analyze the plethora of news and assess opportunities to profit from any significant reaction among the major currency pairs.