Trading Week Ahead: CPI, Retail Sales & Powell in Focus

Markets brace for a volatile week with CPI on Tuesday, retail sales and PPI Thursday, followed by Powell’s speech. A hotter CPI or hawkish Powell could slam the brakes on rate cut hopes, while soft data may ignite a risk-on rally. Are you ready for this week?

• US CPI
Inflation comes back into focus on Tuesday with April’s CPI report. After a surprise decline of -0.1% last month, markets now anticipate a rebound to +0.3%. A stronger reading would likely reinforce the Fed’s cautious stance, delay expectations for rate cuts, and put upward pressure on the dollar and yields. On the other hand, a weaker-than-expected result could support the dovish narrative and spark risk-on flows across markets.

• US Retail Sales & PPI
Thursday brings a key data combo that could stir market volatility. Retail sales are expected to flatline at 0.0%, down sharply from the previous 1.4%, raising concerns about a slowdown in consumer spending. At the same time, PPI is forecast to rise to +0.2% from -0.4%, suggesting a potential uptick in producer-side inflation. This mix of soft demand and rising costs could complicate the Fed’s outlook. If confirmed, markets may reassess the timing and pace of future rate cuts, impacting both USD and risk assets.

• Fed Chair Powell Speaks
Just minutes after Thursday’s releases, Jerome Powell takes the stage. If he highlights easing inflation or softening economic data, markets may lean further into rate cut expectations. A more hawkish tone could support the dollar and trigger risk-off moves across asset classes.

Date	Time	Instrument	Event
Tuesday, May. 13	8:00 AM	GBP	Claimant Count Change
	11:00 AM	EUR	ZEW Economic Sentiment
	2:30 PM	USD	CPI
Wednesday, May. 14	3:30 AM	AUD	Wage Price Index
Wednesday, May. 14	8:00 AM	EUR	German CPI
Thursday, May. 15	3:30 AM	AUD	Employment Change
	8:00 AM	GBP	GDP
	11:00 AM	EUR	GDP
	2:30 PM	USD	PPI, Retail Sales, Unemployment Claims
	2:40 PM	USD	Fed Chair Powell Speaks
Friday, May. 16	1:50 AM	JPY	GDP
Friday, May. 16	4:00 PM	USD	Prelim UoM Consumer Sentiment, Inflation Expectations

Technical Analysis with FVG Strategy

This technical method combines the 20 and 50-period EMAs to identify market direction, paired with the Fair Value Gap (FVG) concept – price imbalances caused by strong market momentum that highlight potential entry and exit zones. The strategy is applicable to instruments like EURUSD, GBPJPY, US30, and XAUUSD, offering a perspective on trading opportunities from both the previous and current weeks.

Last Week’s Opportunities

EURUSD

Market Context: The euro remains above the 50 EMA, indicating a swing bullish structure, but trades below the 20 EMA, reflecting short-term weakness. Last week’s short FVG setup hit its 2:1 RRR target.

Bearish Scenario (Preferred): Continued downside into the nearby support zone is preferred if bearish momentum holds.

Bullish Scenario (Alternative): A move to overhead resistance followed by a full candle close above could shift structure back to bullish.

Setup: No new FVG setup formed this week. The market may remain reactive without fresh structure.

US30

Market Context: Price continues its bullish momentum with minimal corrections. Last Thursday tapped resistance, and Friday brought a minor pullback after filling previous FVG liquidity.

Bullish Scenario (Preferred): Continuation toward swing highs remains the base case if momentum persists.

Bearish Scenario (Alternative): A deeper correction may occur after resistance tests, potentially targeting the swing lows.

Setup: No valid FVG setup has formed this or last week. Traders should watch for reactive pullbacks.

Opportunities to Watch This Week

XAUUSD

Market Context: Gold confirmed its long-term bullish trend after reclaiming the all-time high. A brief correction at the end of the week led to a new short FVG setup, following a failed attempt earlier.

Bearish Scenario (Preferred): A short-term pullback into support zones with a potential sweep of swing lows remains the base case.

Bullish Scenario (Alternative): Close above resistance could invalidate the short bias and reintroduce long targets.

Setup: A valid short FVG setup is active this week. Last week's setup was invalidated by stop-out; the current setup is still valid.

GBPJPY

Market Context: GBPJPY trades above both 20 and 50 EMAs, confirming a strong bullish structure. Price action favours further upside after rebounding from short-term support.

Bullish Scenario (Preferred): Upside continuation into resistance and targeting swing highs is preferred.

Bearish Scenario (Alternative): Break below support could trigger a drop into the FVG zone from previous lows for liquidity fill.

Setup: A valid FVG long setup is active this week. Last week's attempt hit SL, but this week’s setup remains in play.

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