Weekly Market Outlook: Central banks, OPEC and Brexit take centre stage

November 16, 2020 10:00

Weekly Market Outlook: Central banks, OPEC and Brexit take centre stage

While the market volatility from the US presidential election has settled down, it could start to pick up again this week with a range of different economic news announcements and releases.

However, Trump has not yet conceded defeat and Biden will not be sworn in till January. Brexit uncertainties still also remain. Vigilance will be key to navigating markets over the winter. Stay one step ahead by learning these ' Top 10 Risk Management Tips.'

This week is full of central bank speeches from the Reserve Bank of Australia Governor Lowe on Monday, Bank of England Governor Bailey on Tuesday and European Central Bank President Lagarde on Thursday.

Traders will also be focused on the OPEC meetings which are due to start on Tuesday, Canada's inflation report on Wednesday and the Australian employment figures on Thursday. It could be another very interesting week - are you ready?

Weekly News

  • Global stock markets value soared to a record $95 trillion this week on Pfizer's coronavirus vaccine news.
  • Boris Johnson's chief advisor Dominic Cummings and architect of the UK's Vote Leave campaign set to exit at the end of year, creating turmoil in the UK government.
  • Trump fails to concede defeat and presses on with legal challenges of voter fraud.
  • Amazon faces potential $28 billion fine in new antitrust case from the European Commission's Margrethe Vestager.
  • Alibaba records largest ever sales event of more than $58 billion for Single's Day but was overshadowed by new Chinese antitrust regulations.

Forex Calendar provided by Admiral Markets UK Ltd

Source: Forex Calendar provided by Admiral Markets UK Ltd.

Did you know that three times a week, three professional traders talk through the markets live and show you how to identify potential trading opportunities? Reserve your complimentary spot in the Admiral Markets Spotlight webinar now by clicking the banner below!

Free Trading Webinars

Trader's Radar - UK Retail Sales & Brexit

At 7am GMT on Friday November 20, the UK releases its latest month on month retail sales figure. The market is expecting a fall of -0.4%, compared to a 1.5% growth rate last month. Lockdown restrictions have hurt the retail sector, while the government has extended job support schemes to March 2021.

However, the British pound is facing uncertainty from the outcome of this lockdown, a crumbling UK government and Brexit. UK Prime Minister's closest ally and chief advisor, Dominic Cummings, announced he is leaving at the end of the year. The news came as the Prime Minister's director of communications also resigned his post earlier in the week.

As both of them were key members of the Vote Leave campaign to leave the European Union, it puts a fresh question mark over Brexit talks as they enter the final stages of trade talks. While both countries have said progress has been made, there are still some very 'large differences' over state-aid, access to British fishing waters, regulations on workers' rights and environmental protection.

You can learn more in the ' Investing in the UK Stock Market After Brexit' article.

GBPUSD, Weekly chart

Source: Admiral Markets MetaTrader 5, GBPUSD, Weekly - Data range: from Dec 22, 2013, to Nov 13, 2020, performed on Nov 13, 2020, at 6:00 pm GMT. Please note: Past performance is not a reliable indicator of future results.

In the weekly chart above of GBPUSD, price is approaching key resistance at 1.3350. Price has struggled to break through that level on multiple occasions since 2018. A news of a trade deal would likely see price break through this resistance level.

However, even with the UK government crumbling, some ministers say their stance on the EU leaving the UK will not change and that the EU needs to adjust their stance. Traders want to be optimistic on the outcome but it's also wise to prepare for an upset. As price has been moving higher, it has created an ascending trend line which if broken could see further downside likely.

If you're feeling inspired and ready to trade live in the market, you can open a live trading account by clicking on the banner below and accessing an impressive range of trading features to support you in your journey.

Trade Forex & CFDs

Corporate trading updates and stock indices

Global stock markets recorded another impressive week with European indices leading the way. News that Pfizer's coronavirus vaccine drug had a 90% effectiveness in its trials sent investors piling back into stocks. Even sectors which were unloved during the pandemic - such as airlines and travel stocks - experienced a high amount of investor inflows.

The majority of US indices are now trading above or around their historic all-time high price levels. While Donald Trump is refusing to concede defeat, many analysts believe his unproven allegations of voter fraud will not affect the result. Therefore, markets may well be looking ahead to the future and upcoming holiday season.

You can learn more trading retail stocks during the holiday season in the 'Best Retail Stocks to Invest in' article. There are also some key earnings announcements from different companies this week which could add to some increased volatility. Here are just a few that are reporting this week:

  • Monday - Vodafone
  • Tuesday - EasyJet, Wal-Mart
  • Wednesday - Nvidia Corp

SP500, Daily chart

Source: Admiral Markets MetaTrader 5, SP500, Daily - Data range: from March 6, 2019, to November 13, 2020, performed on November 13, 2020, at 7:30 pm GMT. Please note: Past performance is not a reliable indicator of future results.

Last five-year performance of the S&P 500 circa: 2019 = +29.09%, 2018 = -5.96%, 2017 = +19.08%, 2016 = +8.80%, 2015 = -0.82%, 2014 = +12.32%

The above daily chart of the S&P 500 stock market index shows that price briefly attempted to break through its recent all-time price level at 3577. Since the breakthrough, price has settled back down below the price level. What happens here could be critical for the next few months.

If price remains below this level, then sellers could attempt a push back down to the ascending trend line on the chart. A break above the price level could see a strong run up which may well lead into the Santa Claus rally. The key is to look for the patterns, clues or indicators that show the strength of buyers or sellers.

Did you know that you can download the Trading Central Technical Ideas Lookup indicator completely FREE by upgrading your MetaTrader 5 trading platform provided by Admiral Markets UK Ltd to the exclusive Admiral Markets Supreme Edition?

This indicator provides you with actionable trading ideas and technical analysis on thousands of different instruments across a wide variety of asset classes including global stock indices and individual stocks, currencies, commodities and more! Just simply type in the market you want to trade on in the search box, as shown below!

For example, the below screenshot shows all the technical events that have developed on the S&P 500 stock market index:

Technical Insight Lookup indicator

A screenshot of the Technical Insight Lookup indicator from the MetaTrader Supreme Edition platform provided by Admiral Markets.

To get it FREE, just click on the banner below and download it today:

Download MetaTrader 5 Supreme Edition


INFORMATION ABOUT ANALYTICAL MATERIALS:

The given data provides additional information regarding all analysis, estimates, prognosis, forecasts, market reviews, weekly outlooks or other similar assessments or information (hereinafter "Analysis") published on the website of Admiral Markets. Before making any investment decisions please pay close attention to the following:

1.This is a marketing communication. The content is published for informative purposes only and is in no way to be construed as investment advice or recommendation. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.

2.Any investment decision is made by each client alone whereas Admiral Markets UK Ltd (Admiral Markets) shall not be responsible for any loss or damage arising from any such decision, whether or not based on the content.

3.With view to protecting the interests of our clients and the objectivity of the Analysis, Admiral Markets has established relevant internal procedures for prevention and management of conflicts of interest.

4.The Analysis is prepared by an independent analyst Jitan Solanki, Freelance Contributor (hereinafter "Author") based on personal estimations.

5.Whilst every reasonable effort is taken to ensure that all sources of the content are reliable and that all information is presented, as much as possible, in an understandable, timely, precise and complete manner, Admiral Markets does not guarantee the accuracy or completeness of any information contained within the Analysis.

6.Any kind of past or modelled performance of financial instruments indicated within the content should not be construed as an express or implied promise, guarantee or implication by Admiral Markets for any future performance. The value of the financial instrument may both increase and decrease and the preservation of the asset value is not guaranteed.

7.Leveraged products (including contracts for difference) are speculative in nature and may result in losses or profit. Before you start trading, please ensure that you fully understand the risks involved.

Avatar-Admirals
Admirals
An all-in-one solution for spending, investing, and managing your money

More than a broker, Admirals is a financial hub, offering a wide range of financial products and services. We make it possible to approach personal finance through an all-in-one solution for investing, spending, and managing money.