Welcome to Michael Kramer’s pick of the key market events to look out for in the week beginning Monday 3rd November.
The US government will remain shut down, meaning official government data will remain unavailable to market participants. However, some private-sector reports are due this week, which could provide a sense of what is happening in the economy. Additionally, there will be a Bank of England rate decision later in the week, and the US earnings season will continue, although most of the major mega-cap companies have now reported.
US Economic Data
Monday, 3 November
The ISM Manufacturing Report will be released, followed by the ADP Employment Report and the ISM Services Report on Wednesday, 5 November. Together, these three reports should help shed light on the employment picture, overall economic activity, and the health of the US economy. Additionally, the price indices in the ISM reports may offer insight into broader inflation trends. This data is likely to have a significant impact on currency markets, with the USD/JPY in particular focus now that the Bank of Japan has once again stalled on raising rates.
The yen appears to be weakening against the dollar as it breaks above a rising channel and approaches a key resistance level around 154.5. Should it move beyond this level, the yen could be on course to weaken further, towards 158 against the dollar. The RSI also indicates that momentum has shifted, pointing to continued yen weakness versus the dollar. However, it is worth noting that the RSI is nearing 70, which may suggest a pause around the 154.5 level is possible first, with stronger US economic data likely required to drive additional yen depreciation.
USD/JPY CHART AUGUST 2024 - OCTOBER 2025
Sources: TradingView, Michael Kramer
Palantir Earning
Monday, 3 November
The NASDAQ-listed technology company is expected to report third-quarter earnings growth of 68.4% year-on-year to $0.17 per share, on revenue growth of more than 50% to $1.1 billion. For the fourth quarter, analysts forecast earnings of $0.19 per share, up 36.3%, and revenue of $1.2 billion, up 43.9%. The options market is pricing in 10% post-earnings move in the stock.
Implied volatility levels for Palantir are extremely elevated, likely exceeding 100% for options expiring in the week of 7 November, by the time the company reports on Monday after the close of trading. Option positioning is also bullish, with a large gamma level at 200 expected to provide strong resistance, and overall delta positioning is firmly positive. However, as seen in similar cases, extreme bullish positioning can lead to negative market-maker flows as implied volatility declines and as call premiums decay, potentially exerting downward pressure on the shares.
Palantir has struggled to break above the $200 level and has largely remained range-bound around that area since August. If the stock manages to surpass $200, there appears to be room for it to rise towards $210, based on current option positioning.
From a technical perspective however, the stock is nearing overbought territory ahead of earnings. With the shares trading above the upper Bollinger Band and the RSI approaching 70, the risk of a reversal is increasing. A bearish divergence has also formed, with the RSI making lower highs while the share price has made higher lows. This setup suggests that earnings could act as a catalyst for a potential reversal, which might see the shares fall back towards the lower end of their trading range, around $160, or possibly as low as $145.
PALANTIR TEHCNOLOGIES INC. CHART, JANUARY 2025- OCTOBER 2025
Bank of England
Thursday, 6 November
The Bank of England is not expected to cut rates on 6 November, but markets are still pricing in around a 90% chance of a cut by April 2026. As a result, investors will be listening closely for any dovish signals from the BOE at this meeting. Any indication of a near-term rate cut could have a significant negative impact on the British pound, particularly now that it appears the Federal Reserve may not cut rates as aggressively as markets had initially anticipated.
The pound is currently on the verge of breaking a major support level around 1.31, and if that occurs, it could lead to a decline towards 1.275. The 1.31 area appears to be acting as a neckline for what looks like either a head-and-shoulders pattern or a potential double top — in either case, it is a critical level to watch.
GBP/USD CHART, JANUARY 2025 - OCTOBER 2025
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