During the European trading session, a few low-impact reports are expected, such as the construction PMI, Italian retail sales, and Eurozone PPI. These reports likely won’t affect market trends or the European Central Bank’s decisions. In North America, the Canadian services PMI is also scheduled for release, but it’s not expected to create market fluctuations. Since today is a public holiday in the US, market activity will probably be slow. With a quiet European calendar and no significant data expected, focus will shift elsewhere. The construction PMI and Eurozone producer prices might offer insights into specific trends or cost pressures, but they are unlikely to cause any major market movements. Italian retail sales typically don’t have a lasting impact on asset prices unless the results are far from expectations, which isn’t anticipated this time. Across the Atlantic, the Canadian services PMI may provide some information on how the Canadian economy is reacting to tighter financial conditions. However, it is unlikely to significantly change market forecasts. The US market closure means fewer key players are involved, leading to narrow trading and lower liquidity. In our experience, these situations often result in inactive stretches followed by sudden, disconnected price changes. On low-engagement days, there’s less volume to absorb unexpected orders, which can lead to big but short-lived price shifts. We generally avoid making new positions during these times. It’s harder to rely on typical indicators when fewer participants are active. Instead, this period is a good time to check our positions and ensure we’re ready for when liquidity returns. As a result, the current session has limited directional movement. No new factors are changing that. Attention will likely shift to upcoming decisions by monetary authorities and whether market pricing for inflation and growth expectations aligns with their strategies. What we’re focusing on instead are rate expectations. While today’s events won’t directly change those, it’s important to stay alert to small shifts in fixed income instruments or currency futures. Quiet moments often lead to preparatory positioning before larger volumes come into play. The implied volatility of short-dated options has decreased, indicating cautious market positioning. Thin trading sessions can hide deeper trends, especially with major markets like the US closed. We prefer to keep risk low and approach sudden moves with caution unless broader market flows support them. For now, it’s wise to monitor the situation rather than take action. When liquidity returns, trends can emerge quickly—it’s better to watch the buildup now than rush in later when conditions tighten. Finally, since today’s calendar has little to alter expectations for future monetary policy, we’ll look ahead. Examining order book depth, open interest around key expiry dates, and observing yield curves can help clarify the situation. Let’s take advantage of this information.

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