Will ECB’s Draghi meet market expectations and extend QE this week?

The first week of the month is always jam packed with a raft of tier one economic data, and this week is no exception. Perhaps it is even more so than usual, with the added spice of what could prove to be a momentous meeting of the European Central Bank. Despite the market factoring in some sort of extension of easing measures from the ECB, quite what shape those extensions will take remains open to debate not only amongst market participants but also apparently within the Governing Council itself. This makes the reaction to the announcement (not only to rates but also in the press conference too) difficult to call and this is likely to be heightened. There is another crucial factor to consider this week with the final Non-farm Payrolls report of 2015 as part of the last Employment Situation report prior to what is increasingly likely to be a ground-breaking meeting of the Federal Reserve in December.

Quite how these aspects impact on forex markets will be crucial for the direction of not only the US dollar, which has been soaring in recent weeks at the prospect of a Fed rate hike, but also for the euro which has been struggling against major forex crosses. There is also a technical analysis of key forex pairs, Euro/Dollar and Sterling/Dollar. What will be the crucial drivers of major global equity markets this week? Will the DAX be able to sustain its huge gains and what will be the impact of the crucial economic events? The report also includes a technical analysis of the FTSE 100 but also the DAX which shows that the key Fibonacci remain key for the outlook for German equities. The weakness on commodity markets has been causing waves across markets in the past few weeks and could the outlook for these markets be about to change? What does a technical analysis of gold and Brent Crude oil reveal?