The US Dollar Index (DXY) is a popular tool used by forex traders to assess the value of the US dollar relative to a basket of other major currencies. The DXY is calculated using the weighted average of six major currencies: the euro, yen, pound sterling, Canadian dollar, Swedish krona, and Swiss franc. To use the DXY to trade forex, you can follow these steps: 1.
Monitor the DXY: Keep an eye on the movements of the DXY to get a sense of the overall strength or weakness of the US dollar. You can use technical analysis tools, such as moving averages or trend lines, to identify the direction of the trend. 2. Analyse currency pairs Look for forex pairs that are inversely correlated to the DXY.
This means that when the DXY goes up, the currency pair goes down, and vice versa. For example, the EUR/USD pair is negatively correlated to the DXY, which means that as the DXY goes up, the EUR/USD pair goes down. Plan your trades Once you have identified a currency pair that is inversely correlated to the DXY, you can plan your trades accordingly.
For example, if the DXY is showing signs of weakness, you may want to consider going long on a negatively correlated currency pair, such as the EUR/USD. Manage your risk As with any trading strategy, it's important to manage your risk when using the DXY to trade forex. Make sure to use stop-loss orders to limit your losses in case the market moves against you.
Currency pairs may be influenced by other factors besides the DXY, which may not be a perfect indicator of the US dollar's value. To make informed trading decisions, it is important to combine the DXY with other technical and fundamental analysis tools.
By
Mark Nguyen
Account Manager
Artikel ini ditulis oleh analis dan kontributor GO Markets berdasarkan analisis independen atau pengalaman pribadi mereka. Pandangan, opini, atau gaya trading yang diungkapkan sepenuhnya merupakan milik penulis, dan tidak mewakili atau dibagikan oleh GO Markets. Setiap saran yang diberikan bersifat “umum” dan tidak mempertimbangkan tujuan, situasi keuangan, atau kebutuhan pribadi Anda. Sebelum mengambil tindakan berdasarkan saran tersebut, pertimbangkan apakah saran tersebut sesuai dengan tujuan, situasi keuangan, dan kebutuhan Anda. Jika saran tersebut berkaitan dengan perolehan produk keuangan tertentu, Anda harus memperoleh Pernyataan Pengungkapan (Disclosure Statement/DS) dan dokumen hukum lainnya yang tersedia di situs web kami sebelum membuat keputusan apa pun.
There are few trades as appealing, or as risky, as trying to catch a market reversal. The idea of entering at the turning point and riding the new trend is exciting. However, most traders fail to consistently produce good trading outcomes on this potential, often entering too early without confirmation, and thus get caught at a pause point of a continuing powerful move.Trend reversals can indeed offer excellent reward-to-risk potential, but as with any trading approach, only when approached systematically, the confluence of key factors, and timing.
What Is a High-Probability Entry?
Before diving into reversals specifically, let’s define what we mean by a high-probability entry.A high-probability entry is a trade taken in conditions where:
There is clear evidence from price action and structure
There is an alignment with the overall market context, such as timing, favourable price levels, and volatility
Risk can be logically defined and limited to within your tolerable limits
It may offer a favourable risk-to-reward profile (providing you execute following a pre-defined plan)
This approach should underpin all trading strategy development. And be consistently executed according to your defined rules, which must be constantly reviewed and refined based on trading evidence.
Reversal vs. Retracement: Know the Difference
Many traders confuse a retracement with a reversal, often with potentially costly consequences. It is ok to exit on a retracement and be ready to go again if there is a breach of the previous swing high. But this must be part of your plan, with a strategy for trend continuation in place. However, if your plan suggests that you DON’T want to exit on retracements, then the following table gives some guidance on what potential differences may be. RetracementReversalA temporary move against the trendA complete shift in directional controlPrice often continues in original directionPrice begins trending in the opposite directionHealthy part of a trend’s rhythmMarks the end of a trendTypically shallow, to a Fib/MA/structureOften deep, may break previous swing structureVolume often reduced after swing high if long or swing low if short.Volume often increased after swing high if long or visa versa.
Understanding Trend Exhaustion
Before any reversal occurs, the existing trend must show signs of exhaustion. This is the first phase of a potential turning point — and one of the most overlooked.
How Trend Exhaustion Looks on a Chart:
Climactic candles – multiple wide-range bars with expanding bodies.
Failed breakouts – price pushes through a level but fails to hold.
Volume spikes with no follow-through – smart money distributing or exiting.
Multiple tests of the same level – a sign that the trend is running out of energy.
The Anatomy of a High-Probability Reversal
A strong reversal setup typically has three key factors that can be supportive of a of follow-through.
1. Location – Price at a Key Zone
Major support/resistance level honoured
Prior swing highs or lows at a similar price point
Higher timeframe structure – I,e, agreement on a 4 hourly chart as well as an hourly.
In simple terms, if the price isn’t at a meaningful location, a meaningful reversal is less likely to occur.
2. Previous Signs of Trend Exhaustion
We have covered this above, with evidence that the current trend has now weakened, and there is some justification to prepare to enter a counter-trend.
3. Structural Confirmation
This is the trading trigger you are looking for as a potential signal for entry. Structural confirmation transforms an idea (“the price might reverse”) into an actual setup (“the reversal is underway”).Look for the following four signs:
Trendline or key short-term moving average breached
Lower highs and lower lows in an uptrend or higher lows in a downtrend
Confirmation that a key swing point has been honoured
Evidence that a retest and rejection of the broken structure has occurred.
This shows that momentum has not just stalled, it has now shifted.
Context Filters
Reversals are more likely to succeed when conditions are supported by other factors. This is to do with the identification of a strong market context where reversals are more likely to happen. These may include:
Time of day: The open of London or US sessions, or into session close when there may be some profit taking on a previously strong move
Volatility extremes: Price has expanded beyond its normal daily range (ATR-based or visually evidenced on a chart)
Market sentiment: Everyone is already long at the top or short at the bottom — setting up for a squeeze
Catalysts: Reactions to news, or data, that may cause a significant one-sided move
Adding context could make the difference between a technically correct trade and one that may offer a higher probability of going in your desired direction.
Recognising Common Reversal Patterns
There are classic chart patterns that may help visually reinforce the principles. They reflect exhaustion, rejection, and structural change, and may encourage many traders to follow the move, adding extra momentum to any initial move. PatternSignal TypeKey ClueConfirmation NeededDouble Top/BottomReversal StructureRepeated rejection of key levelBreak of swing low/high between peaksHead & ShouldersMomentum FailureFailed retest after strong pushNeckline breakPin BarExhaustion CandleSharp rejection with long wickOpposite-direction close after the pinEngulfingSudden Power ShiftOne candle overtakes previous rangeFollow-through candleRounding Top/BottomSlow Institutional TurnGradual stalling and reversalNeckline break of curveBreak of Structure (BoS)Structural ConfirmationNew higher low/lower high, support breakRetest and failure to reclaim broken level⚠️ These patterns should not be traded in isolation. Use them with context and only after signs of exhaustion and structure shifts.
FOUR Trader Reversal Traps to Avoid
Even with a solid framework, it’s easy to fall into common traps:
Trying to pick the exact top or bottom - Wait for price to prove the turn, don’t anticipate and enter early
Entering against the higher timeframe trend – Zooming out and checking alignment with higher timeframes may be prudent to reduce the likelihood of having to fight momentum on larger timeframes.
Trading every reversal signal - Not all signals are valid or particularly strong. Look for the confluence of multiple factors covered earlier, not just the presence of a pattern.
Letting bias override evidence - Just because you want a reversal to happen, it NEVER means it is there unless backed up by evidence.
Don’t Forget the Full Trading Story
A great setup means nothing without excellent execution. These ESSENTIAL facts are critical as with any trade, but there will never be an apology for reinforcing these.
Patience and execution discipline
Wait for your full criteria to be met. Avoid “almost” setups that feel tempting but don’t fully align with your full plan criteria. Likewise, when all your boxes are ticked, then take action.
Exit strategy
Use a mix of targets, structure-based trails, or scaling out, and know in advance how you’ll manage the trade once it starts moving.High-probability entries are only one part of a winning trade. Exit efficiently or you’ll waste great entry setups because of poor execution. There are many traders in this position; make sure you are not one of them.
Summary
High-probability reversals are not about being right at the top or bottom when you enter; this is rarely possible and adds additional risk without confirmation. They are about recognising and being ready when the trend is potentially changing, and taking action when:
Price is at a key level
The current trend shows clear signs of exhaustion
Structure confirms the shift
And context supports the move
Trade the evidence and your plan, not just what you think is likely to happen. Be patient, be ready, and when the setup is there, execute your trade with confidence.
Crude Oil has always been one of the most popular and highly traded markets for CFD traders whether it is WTI or Brent, especially recently as geopolitical and economic forces have seen its price fluctuate from extreme lows to extreme highs. It’s easy to see why, Oil is a bellwether for the health of the global market, oil greases the wheels of global commerce and with CFDs it’s possible to take a position in this exciting market, whether you think the price will head up or down. In this CFD Oil trading Article we will look at the following: How to use CFDs to trade oil Fundamental forces that drive the price of oil Popular technical strategies for trading oil CFDs How to use CFDs to trade oil CFDs or Contracts For Difference allow you to speculate on the price of oil, without owning the underlying asset.
A spot oil CFD tracks the price of the spot market being the cleanest and most efficient way to speculate on the price of oil. They also allow you to take a position in both directions, you would enter a buy (Long) positions if you believed the price will rise, or a sell (Short) position if you believe the price will fall. With Long positions you are looking to buy and sell at a higher price at a later time to profit on the trade.
With a Short position you are selling with the view to buy back at a later time to profit on the trade. At GO Markets we offer our clients the worlds most popular oil trading platform in Metatrader 4 and 5, another advantage to these CFD trading platforms is the ability to automate oil trading strategies. Other advantages to trading oil CFDs with GO Markets: Trade 23 hours a day on WTI oil, 21 hours a day on Brent oil, unlike an ETF or oil company listed on a stock exchange that is only open while that stock exchange is open.
Leverage – the margin required to open the trade will be a fraction of the face value of the position depending on what leverage you are comfortable with. Flexibility in position sizing starting from 0.1 lot ($0.10 USD per point movement in oil) unlike oil futures which have rigid contract sizes. Rolling contract, no expiries such as in options or futures to worry about.
To Enter a position in Metatrader, you would bring up a deal ticket by clicking “New Order” then select your position size, any Stop Loss or Take Profit levels you want the position to automatically close at and hit Buy or Sell. As with any instrument, make sure you are familiar with the lot sizing. 1 standard lot in oil (USOUSD and UKOUSD) is 100 barrels, or $1 USD a point so make sure you set the volume to a level commensurate to your account size and risk appetite. Now, the next question is how you decide on a buy or sell, let’s look at the fundamentals of what drives oil and some technical analysis you can use to answer this question.
Fundamental forces that drive the price of oil Both WTI oil (USOUSD) and Brent Oil (UKOUSD) are highly correlated and will both be referenced as “oil” in the below. While no one reason can be fully attributed to movements in the price of oil, there are an important few fundamental drivers that will influence the price and whose relationship has been time tested. None of these on their own should be used as a sole reason to enter a position, but having the fundamentals on your side will certainly give you an advantage.
The main fundamental drivers in my experience are The perceived health of the global economy OPEC+ production cuts or increases Geopolitical issues The perceived health of the global economy Oil is the driver of commerce, it is needed for the transport and manufacturing of goods and getting people around. If economic conditions are deteriorating, it means less economic activity and the need for less oil sending the price down. A global economy which is seen as “hot” means more economic activity and more demand for oil, seeing it’s price increase.
A clear chart to see this is the price of oil as compared to the US 10-year bond yield over the years. You can see the price of oil and the yield are highly correlated, this is due to yields going up when the economy is “hot” and yields falling when the economy enters a period of contraction, similar price drivers to oil. The black line is WTI oil price, the orange US 10-year yields going back 10 years.
Source: tradingview.com OPEC+ production cuts or increases The Organization of the Petroleum Exporting Countries (OPEC) is a cartel of leading oil-producing countries formed in order to collectively influence the global oil market. OPEC started with a handful of Middle Eastern oil producers in 1960, and has since grown to 24 members in OPEC+. Even thought the USA is currently the worlds top oil producer, OPEC+ countries as a whole still dominate global oil supply and decisions made by the cartel can have a dramatic influence on the price of crude oil.
Market share of oil producing nations: Source: gisreportsonline.com OPEC+ hold regular meetings during the year, normally the expected result is well telegraphed, but sometimes there can be a surprise, such as at their latest meeting on Sunday April 2 nd, 2023, where a surprise production cut was announced, seeing the price of oil gap significantly higher on Mondays open, showing oil traders to always approach these meetings with caution. Geopolitical issues The last three years has seen some very influential geopolitical events, or “black swans” and oil being closely tied to the health of the global economy has seen some very big moves on the back of these events. The Pandemic and its related lock downs and slowing of global commerce saw the price of oil slump to all time lows, followed by the war in Ukraine which saw oil jump to multi year highs on the fear of supply disruptions (Russia is the second biggest oil producer in the world) The chart below illustrates this: Oil traders especially need to be aware of geopolitical risks as the above chart shows.
Technical strategies for trading oil CFDs While having a good understanding of the fundamentals (in my opinion) is important to help you choose the best trades most traders will use a combination of technical analysis and fundamentals with the aim for higher probability outcomes in their trades. Some traders will use technical analysis exclusively without any interest in the fundamental drivers using things such as RSI oscillators, support and resistance areas and trend lines solely to decide on their trade direction. Which option is best is solely up to the trader, their time frames for the trades and risk appetite, all can work, and all can fail neither option can be seen as “better” than the other, it all depends on the individual trader.
Technical analysis is an art in itself and there is a lot to learn on this subject, I encourage anyone interested to research the many weird and wonderful technical analysis strategies that are documented online. But let’s take a look at a popular technical indicators that oil traders use to make their trades. Support and Resistance Support and resistance are one of the most widely used and accurate (when used correctly) technical indicators that can be used by traders.
Support and Resistance areas are points in the market where the price is held from going lower (Support) or going higher (Resistance), these are areas where buyers or sellers are entering the market as they see value in the asset at that price. These levels can last a long time or be temporary and can be used to predict turn arounds in the market, or a break of these levels could indicate a further push in that direction. Oil is also particularly sensitive to psychological levels around “big figures” or rounded number, e.g. 79.00 and 74.00 As can be seen on the chart below.
Hopefully this article has given you an interest to learn more about trading oil with CFDs. Feel free to contact the GO Markets team if you have any questions on trading oil CFDs and opening an account with us.
The US Dollar Index (DXY) is a popular tool used by forex traders to assess the value of the US dollar relative to a basket of other major currencies. The DXY is calculated using the weighted average of six major currencies: the euro, yen, pound sterling, Canadian dollar, Swedish krona, and Swiss franc. To use the DXY to trade forex, you can follow these steps: 1.
Monitor the DXY: Keep an eye on the movements of the DXY to get a sense of the overall strength or weakness of the US dollar. You can use technical analysis tools, such as moving averages or trend lines, to identify the direction of the trend. 2. Analyse currency pairs Look for forex pairs that are inversely correlated to the DXY.
This means that when the DXY goes up, the currency pair goes down, and vice versa. For example, the EUR/USD pair is negatively correlated to the DXY, which means that as the DXY goes up, the EUR/USD pair goes down. Plan your trades Once you have identified a currency pair that is inversely correlated to the DXY, you can plan your trades accordingly.
For example, if the DXY is showing signs of weakness, you may want to consider going long on a negatively correlated currency pair, such as the EUR/USD. Manage your risk As with any trading strategy, it's important to manage your risk when using the DXY to trade forex. Make sure to use stop-loss orders to limit your losses in case the market moves against you.
Currency pairs may be influenced by other factors besides the DXY, which may not be a perfect indicator of the US dollar's value. To make informed trading decisions, it is important to combine the DXY with other technical and fundamental analysis tools.
For over 110 years, the Federal Reserve (the Fed) has operated at a deliberate distance from the White House and Congress.
It is the only federal agency that doesn’t report to any single branch of government in the way most agencies do, and can implement policy without waiting for political approval.
These policies include interest rate decisions, adjusting the money supply, emergency lending to banks, capital reserve requirements for banks, and determining which financial institutions require heightened oversight.
The Fed can act independently on all these critical economic decisions and more.
But why does the US government enable this? And why is it that nearly every major economy has adopted a similar model for their central bank?
The foundation of Fed independence: the panic of 1907
The Fed was established in 1913 following the Panic of 1907, a major financial crisis. It saw major banks collapse, the stock market drop nearly 50%, and credit markets freeze across the country.
At the time, the US had no central authority to inject liquidity into the banking system during emergencies or to prevent cascading bank failures from toppling the entire economy.
J.P. Morgan personally orchestrated a bailout using his own fortune, highlighting just how fragile the US financial system had become.
The debate that followed revealed that while the US clearly needed a central bank, politicians were objectively seen as poorly positioned to run it.
Previous attempts at central banking had failed partly due to political interference. Presidents and Congress had used monetary policy to serve short-term political goals rather than long-term economic stability.
So it was decided that a stand-alone body responsible for making all major economic decisions would be created. Essentially, the Fed was created because politicians, who face elections and public pressure, couldn’t be relied upon to make unpopular decisions when needed for the long-term economy.
Although the Fed is designed to be an autonomous body, separate from political influence, it still has accountability to the US government (and thereby US voters).
The President is responsible for appointing the Fed Chair and the seven Governors of the Federal Reserve Board, subject to confirmation by the Senate.
Each Governor serves a 14-year term, and the Chair serves a four-year term. The Governors' terms are staggered to prevent any single administration from being able to change the entire board overnight.
Beyond this “main” board, there are twelve regional Federal Reserve Banks that operate across the country. Their presidents are appointed by private-sector boards and approved by the Fed's seven Governors. Five of these presidents vote on interest rates at any given time, alongside the seven Governors.
This creates a decentralised structure where no single person or political party can dictate monetary policy. Changing the Fed's direction requires consensus across multiple appointees from different administrations.
The case for Fed independence: Nixon, Burns, and the inflation hangover
The strongest argument for keeping the Fed independent comes from Nixon’s time as president in the 1970s.
Nixon pressured Fed Chair Arthur Burns to keep interest rates low in the lead-up to the 1972 election. Burns complied, and Nixon won in a landslide. Over the next decade, unemployment and inflation both rose simultaneously (commonly referred to now as “stagflation”).
By the late 1970s, inflation exceeded 13 per cent, Nixon was out of office, and it was time to appoint a new Fed chair.
That new Fed chair was Paul Volcker. And despite public and political pressure to bring down interest rates and reduce unemployment, he pushed the rate up to more than 19 per cent to try to break inflation.
The decision triggered a brutal recession, with unemployment hitting nearly 11 per cent.
But by the mid-1980s, inflation had dropped back into the low single digits.
Pre-Volcker era inflation vs Volcker era inflation | FRED
Volcker stood firm where non-independent politicians would have backflipped in the face of plummeting poll numbers.
The “Volcker era” is now taught as a masterclass in why central banks need independence. The painful medicine worked because the Fed could withstand political backlash that would have broken a less autonomous institution.
Are other central banks independent?
Nearly every major developed economy has an independent central bank. The European Central Bank, Bank of Japan, Bank of England, Bank of Canada, and Reserve Bank of Australia all operate with similar autonomy from their governments as the Fed.
However, there are examples of developed nations that have moved away from independent central banks.
In Turkey, the president forced its central bank to maintain low rates even as inflation soared past 85 per cent. The decision served short-term political goals while devastating the purchasing power of everyday people.
Argentina's recurring economic crises have been exacerbated by monetary policy subordinated to political needs. Venezuela's hyperinflation accelerated after the government asserted greater control over its central bank.
The pattern tends to show that the more control the government has over monetary policy, the more the economy leans toward instability and higher inflation.
Independent central banks may not be perfect, but they have historically outperformed the alternative.
Turkey’s interest rates dropped in 2022 despite inflation skyrocketing
Why do markets care about Fed independence?
Markets generally prefer predictability, and independent central banks make more predictable decisions.
Fed officials often outline how they plan to adjust policy and what their preferred data points are.
Currently, the Consumer Price Index (CPI), Personal Consumption Expenditures (PCE) index, Bureau of Labor Statistics (BLS) monthly jobs reports, and quarterly GDP releases form expectations about the future path of interest rates.
This transparency and predictability help businesses map out investments, banks to set lending rates, and everyday people to plan major financial decisions.
When political influence infiltrates these decisions, it introduces uncertainty. Instead of following predictable patterns based on publicly released data, interest rates can shift based on electoral considerations or political preference, which makes long-term planning more difficult.
The markets react to this uncertainty through stock price volatility, potential bond yield rises, and fluctuating currency values.
The enduring logic
The independence of the Federal Reserve is about recognising that stable money and sustainable growth require institutions capable of making unpopular decisions when economic fundamentals demand them.
Elections will always create pressure for easier monetary conditions. Inflation will always tempt policymakers to delay painful adjustments. And the political calendar will never align perfectly with economic cycles.
Fed independence exists to navigate these eternal tensions, not perfectly, but better than political control has managed throughout history.
That's why this principle, forged in financial panics and refined through successive crises, remains central to how modern economies function. And it's why debates about central bank independence, whenever they arise, touch something fundamental about how democracies can maintain long-term prosperity.
February opens with a policy-heavy tone led by Australia’s RBA decision, while Japan provides the core macro anchors through GDP and inflation updates. In contrast, China’s calendar lightens due to the Spring Festival, shifting attention to liquidity and policy headlines. Across the region, a firmer USD and softer metals continue to frame cross-asset performance, especially for commodity-linked currencies.
Australia: RBA
Australia begins February with a policy-driven focus as the Reserve Bank of Australia (RBA) delivers its monetary policy decision, setting the month’s initial tone for rates, currency, and equities. While markets had priced around a 70% chance of a hike as of 30 January, expectations remain highly sensitive to evolving data and RBA commentary.
Key dates
RBA Monetary Policy Decision: 2:30 pm, 3 February (AEDT)
Wage Price Index (WPI): 11:30 am, 18 February (AEDT)
Labour Force: 11:30 am, 19 February (AEDT)
What markets look for
Aussie traders will gauge whether the RBA reinforces a data‑dependent stance or shifts more decisively toward tightening.
Wage and labour data will be central in testing inflation persistence, while the next CPI reading anchors positioning heading into March. A balanced or mildly hawkish tone could keep short‑term yields elevated and limit downside in the AUD.
Market sensitivities
AUD and ASX performance will primarily reflect the RBA’s policy tone and broader USD momentum, while resource‑linked sectors should continue to track metals and bulk commodity trends.
The February earnings season, highlighted by CBA and CSL (11 Feb), BHP (17 Feb), and Rio Tinto (19 Feb), is also set to reintroduce stock‑specific drivers once the initial policy focus fades.
Australia’s February Consumer Price Index (CPI) release will be a key post‑RBA event, offering the clearest read on whether domestic inflation pressures are easing in line with the central bank’s expectations.
The data following the RBA’s February policy decision and could quickly reset rate path probabilities reflected in ASX futures pricing.
Key dates
Consumer Price Index (CPI): 11:30 am, 25 February (AEDT)
What markets look for
Markets will focus on whether trimmed‑mean and services inflation components show further moderation.
Persistent strength in non‑tradables or wage‑related sectors could reinforce expectations for additional tightening later in Q1, while a softer headline would support the view that policy rates have peaked.
Market sensitivities
A stronger‑than‑expected CPI print would likely lift front‑end yields and support the AUD, while a downside surprise could weigh on the currency and flatten the yield curve.
Equity sentiment may diverge and financials could find relief from a pause bias, whereas rate‑sensitive sectors like real estate and consumer discretionary would benefit most from a cooler inflation read.
Japan’s Q4 GDP release will be a key reference point for how firmly the recovery is progressing after recent quarters of uneven growth momentum. Arriving ahead of the Tokyo CPI print, it helps shape expectations for domestic demand, external trade performance, and how much scope policymakers have to adjust their stance without derailing activity.
Key dates
Q4 GDP: 11:50 pm, 15 February (GMT)/ 10:50 am, 16 February (AEDT)
What markets look for
Investors pay close attention to the balance between consumption, business investment, and net exports to judge whether growth is broad‑based or narrowly supported.
A stronger‑than‑expected print tends to reinforce confidence in Japan’s expansion story, while a weaker outcome can revive concerns about stagnation and delay expectations for any meaningful policy shift.
Japan: Tokyo CPI
Tokyo’s latest inflation reading shows headline CPI easing to 1.5% year‑on‑year in January from 2.0% in December 2025, dipping further below the recent peaks seen during the post‑pandemic upswing.
The CPI release offers one of the timeliest reads on Japan’s inflation pulse and is closely watched as a lead indicator for nationwide price trends.
Coming late in the month, it serves as a check on whether the recent inflation upswing is sustaining at levels consistent with policymakers’ many objectives.
Tokyo CPI: 11:30 pm, 26 February (GMT)/ 10:30 am, 27 February (AEDT)
What markets look for
Attention centres on core measures that strip out volatile components, alongside services prices, to see whether underlying inflation is holding near target or drifting lower.
A firmer profile strengthens the case that Japan is exiting its low‑inflation regime, while softer readings suggest that price pressures remain fragile and dependent on external factors.
Market sensitivities
A hotter‑than‑expected Tokyo CPI print can push Japanese yields higher and lend support to the yen, often translating into pressure on exporter‑heavy equity names.
Conversely, a softer outcome tends to ease yield pressures, weaken the yen, and provide some relief to equity sectors that benefit from a more accommodative policy backdrop.
China’s February macro calendar is structurally lighter due to Spring Festival timing.
The National Bureau of Statistics of China notes that some releases are adjusted around Spring Festival timing, with the February PMI scheduled for early March leaving markets without major domestic data anchors for much of the month.
Key dates
Spring Festival: 17 February to 3 March
What markets look for
Markets turn their focus to policy signals out of Beijing — think targeted stimulus or liquidity injections, as well as shifts in funding conditions and flows responding to global risk sentiment or USD moves.
Trade and tariff rhetoric, or surprise consumption measures like expanded trade-in subsidies and festive spending incentives recently flagged by the Ministry of Commerce, often spark sharper reactions than the usual data releases.
Market sensitivities
CNH and CNY pairs turn more reactive to USD flows and external headlines, often amplifying volatility in regional equities, commodity currencies like AUD, and China-exposed EM assets.
Holiday-thinned liquidity elevates headline risk, particularly in materials (iron ore, copper), tech hardware supply chains, and regional financials, where policy surprises or US tariff updates can trigger 1–2% daily index swings.
Expected earnings date: Wednesday, 4 February 2026 (US, after market close) / ~8:00 am, Thursday, 5 February 2026 (AEDT)
Alphabet’s earnings provide insight into global digital advertising demand, enterprise cloud spending, and broader technology-sector investment trends.
As Google Search and YouTube are widely used by both consumers and businesses, results are often used as one input when assessing online activity and corporate marketing budgets, alongside other indicators.
Key areas in focus
Search
Search advertising remains Alphabet’s largest revenue driver. Markets are likely to focus on ad growth rates, pricing metrics such as cost-per-click, and overall advertiser demand across sectors such as retail, travel, and small-to-medium businesses.
YouTube
YouTube contributes to both advertising and subscription revenue. Markets commonly monitor advertising momentum, engagement trends, and monetisation developments as indicators of digital media conditions and brand spending.
Google Cloud
Sustained Cloud profitability is often discussed as a factor that may influence longer-term earnings expectations, though outcomes remain uncertain. Markets are expected to focus on revenue growth, enterprise adoption trends, and operating margins.
Other bets
Initiatives such as autonomous driving and life sciences, while typically smaller contributors to revenue, markets may still watch spending levels and progress updates as indicators of capital allocation and cost discipline.
Cost and margin framework
Management has previously flagged elevated capex tied to AI infrastructure, including data centres, specialised chips, and computing capacity. Traffic acquisition costs, staffing levels, and infrastructure expansion are also key variables influencing profitability.
What happened last quarter
Alphabet’s most recent quarterly update highlighted advertising trends, Cloud profitability, and continued increases in capex to support AI initiatives.
Management commentary has indicated that infrastructure spending is intended to support long-term competitiveness, while the market continues to assess the near-term margin trade-offs.
Last earnings key highlights
For reported figures and segment detail from the most recent quarter, refer to Alphabet’s latest earnings release materials, including revenue, earnings per share (EPS), Services mix, Cloud operating income, and capex commentary.
Bloomberg consensus estimates moderate year-on-year (YoY) revenue growth and higher EPS versus the prior-year quarter, with ongoing focus on operating margins given AI-related investment.
Bloomberg consensus reference points:
EPS: low-to-mid US$2 range
Revenue: high US$80 billion to low US$90 billion range
Capex: expected to remain elevated
*All above points observed as of 31 January 2026.
Market-implied expectations
Listed options implied an indicative expected move of around ±4% to ±6% over the relevant near-dated expiry window. Movements derived from option prices observed at 11:00 am AEDT, 2 February 2026.
These are market-implied estimates and may change. Actual post-earnings price moves can be larger or smaller.
What this means for Australian market participants
Alphabet’s earnings can influence near-term sentiment across major US equity indices, particularly Nasdaq-linked products, with potential spillover into the Asia session following the release.
Important risk note
Immediately after the US close and into the early Asia session, Nasdaq 100 (NDX) futures and related CFD pricing can reflect thinner liquidity, wider spreads, and sharper repricing around new information.
Such an environment can increase gap risk and execution uncertainty relative to regular-hours conditions.
