This Week’s Economic Calendar
Rage-bound Consolidation has Defined 2025 So Far
Just like the daily “power of three”, the first few trading days of 2025 has been the accumulation phase of the yearly range. We’ve seen consolidation ranges with a constant return to fair value. When the higher time frames consolidate, the lower time frames follow suit—price is fractal. This means that a consolidating higher time frame creates slightly more challenging conditions on the intraday charts, as we’ve observed in the indices so far. It calls for patience, reduced trade frequency, and managed expectations—only targeting scalps into intraday liquidity with the focus on getting paid and out until we break out of the range.
Looking Ahead:
This week is data-heavy, with the spotlight on the FED Chair’s speech on Tuesday at 10 AM and the CPI numbers set for release on Wednesday at 8:30 AM. Expect heightened volatility around these news events and look to capitalize on high-probability opportunities that present themselves within a higher time frame draw.
Please note that this is not financial advice.
Monday:
Given that today is the first trading day of the week, patience and managed expectations are crucial. With no major economic news expected to inject volatility, traders should look for opportunities pre-market if the market structure presents a high-probability setup. I recommend focusing on identifying the most probable higher time-frame draw on liquidity during the Opening Range (9:30-10:00 AM) and 10:00 AM Silver Bullet capitalizing on the volatility near the 9:30 opening bell.
Tuesday:
Fed Chair Powell is scheduled to speak at 10 AM, and his address is expected to impact the market throughout the AM session. This will transition into the Silver Bullet distribution hour, likely injecting further volatility. However, anticipate a consolidation profile leading up to his speech. During his address, increased volatility and erratic whipsaws may occur.
Traders are advised to manage expectations and optimize trading opportunities by focusing on the pre-market—provided the market structure presents a high-probability setup. To protect capital, it’s best to avoid the PM session, where lower-probability, high-resistance price delivery is expected ahead of Wednesday’s CPI release.
Wednesday:
This day brings the anticipation of the CPI numbers at 8:30 AM, which is expected to inject significant volatility into the market following the news release. While we typically avoid trading ahead of high-impact news driver, the post-news release reveals liquidity and inefficiencies that can be capitalized on as a draw. Focus on the AM Session beginning at 9:30 and the PM session for higher probability trade setups.
Thursday:
Expect heightened volatility in the AM session due to multiple key high impact news drivers scheduled at 8:30 AM. Focus on identifying the most probable higher time-frame draw on liquidity post-news release or, alternatively, wait for the 10 AM Silver Bullet window to frame low risk, high probability setups.
Friday:
Red folder news drivers are scheduled for 8:30 AM expected to inject volatility into the market. If you haven’t met your weekly profit objectives, focus on identifying the most probable higher time frame draw on liquidity post-news release or, alternatively during the 10:00 AM Silver Bullet window and the PM session, should a suitable setup present itself.
Earnings Spotlight: Major Corporate Reports Unveiling This Week – Key Insights for Investors
Earnings Reports Impact: A gentle reminder to fellow traders: anticipate significant price movements surrounding earnings reports in large-cap companies. This period often presents strategic trading opportunities, capitalizing on heightened volatility for smoother trades.
The upcoming week will focus on earnings reports from major large-cap institutions—American Electric Power, Ameren, AES, NRG, and DTE. These key players are expected to drive heightened market volatility, with potential consolidation leading up to their report releases.
The Cot Report For The US Dollar
The Previous Week in Review
Over the past three weeks, the US dollar has been in a range-bound consolidation, marked by its inability to displace from the weekly discount FVG.Waiting patiently into the new week is to see how we trade within the current weekly FVG for further insights, all while maintaining a bullish bias until a clear break of structure to the downside invalidates-the current bullish order flow.
On the other side, the traders COTs report—especially from commercials, whose footprints we track for informed decision-making—continues to load fresh short hedges in Q1 of 2024, signaling an anticipation of a lower US dollar in both the near and long term. The discrepancy between technicals and fundamentals persists into the new week, hinting at heavy smart money accumulation underway, which is critical to monitor as we move forward.
What does this signify for us as traders?
The commercials, as reflected in the Commitment of Traders report, continue to anticipate lower prices for the US dollar in the near term. However, this outlook must be confirmed by a displacement out of the current range and a clear break of structure to the downside. Until that happens, any new premium highs will likely be used by smart money to accumulate more short orders and build their positions. Conversely, the creation of new highs could also price in a smart money reversal in line with the commercial positioning and the overall data.
Seasonal Tendencies
The US Dollar
The US dollar remains range-bound into early February trading, currently positioned in a discount of the weekly dealing range—a detail we must monitor for further clarity.
Seasonal data for February projects a higher US dollar, with a long-term low expected to be priced in early in the month. This supports the anticipation of a massive price swing, if confirmed by institutional order flow.
While this outlook might seem contrary to the Commitment of Traders report, we’ll continue to trust our buy models in a buy program until a clear break of structure is observed within the institutional order flow, prompting a necessary change in bias.
Stay informed for sound decision-making, and always adhere to strict risk management protocols.
Until our next update, trade wisely.
Happy Trading!
Adora Trading Team
