1. Hello Guest Click here to check FX Binary Point Financial Directory

US GDP preview: What to expect of EUR/USD?

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Dec 22, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Mumbai) - The EUR/USD is trading around 1.0940 (61.8% of rally seen in Mar-Aug) amid weak European stocks and ahead of the US Q3 GDP release.

    US data a non-event?

    The third quarter GDP numbers due for release today is likely to leave the growth rate unchanged at 2.1% y/y. Meanwhile, the core personal consumption expenditure (pce); which is a Fed’s preferred gauge of inflation; is seen unchanged at 1.2% y/y.

    The data comes a week after the Fed hiked rates by 25 basis points and hinted at four more rate hikes next year. Consequently, the GDP figure due today risks turning out to be a non-event unless the figure is surprisingly strong/weak.

    Moreover, it would take a horribly weak number to convince the markets that the Fed could delay further rate hikes. Thus, a downward revision of the GDP and core PCE could see a correction in the crowded USD long trade. On the other hand, an upward revision could only add to the USD strength.

    EUR/USD Technical Levels

    The pair currently hovers around 1.0940 (61.8% of Mar-Aug rally), above which the pair could target 1.1006 (50% of 1.1495-1.30517). A break higher could be seen if the US GDP is revised higher, opening doors for 1.1040 (200-DMA). On the other hand, support is seen at 1.0890 (38.2% of 1.1495-1.0517), under which the pair could target 1.08 levels. A break lower could be seen if the US GDP is revised lower; pushing the pair down to 1.0758 (76.4% of Mar-Aug rally).
    For more information, read our latest forex news.

Share This Page