News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View more
Real Time News
  • Will be covering the Japanese #Yen to see how retail positioning could shape the outlook for $USDJPY, $AUDJPY and $EURJPY Starting in about 30 minutes! Signup for the session below: https://t.co/afqne77wU6
  • Join @ddubrovskyFX at 20:00 EST/00:00 GMT for a webinar on what other traders' buy/sell bets say about price trends. Register here: https://t.co/AzOQioRZER https://t.co/h2DAnqnY7J
  • #BlackRock: We are neutral U.S. equities. We see U.S. growth momentum peaking and expect other regions to be attractive ways to play the next leg of the restart as it broadens to other regions, notably Europe and Japan $SPX $NDX
  • #BlackRock: The new nominal theme leads to a steeper yield curve expectation than market pricing. We see yields rising gradually, keeping us broadly underweight government bonds, particularly for longer maturities #trading $TLT
  • BlackRock: We are overweight European equities, and neutral Japan #trading
  • Gold prices face off with rising Treasury yields as jobs data approaches. Meanwhile, iron ore prices caught a small bid on bullish port activity out of China. Get your market update from @FxWestwater here:https://t.co/A79cY6KvDI https://t.co/rJ0xqsUPu1
  • Key levels in forex tend to draw attention to traders in the market. These are psychological prices which tie into the human psyche and way of thinking. Learn about psychological levels here: https://t.co/8A1QhwvklO https://t.co/cRqAcvYkI8
  • #Blackrock: We are moderately pro-risk and keep some cash to potentially further add to risk assets on any market turbulence #trading $SPX $RUT $DJIA
  • RT @BrendanFaganFx: Natural Gas Outlook: Price Continues to Soar as Severe Winter Shortage Looms $NG $NG_F Link: https://www.dailyfx.com/forex/market_alert/2021/09/28/Natural-Gas-Outlook-Price-Continues-to-Soar-as-Severe-Winter-Shortage-Looms.html…
  • USD/CAD is set to snap a five-day sell-off with today’s rally breaking near-term downtrend resistance. Get your $USDCAD market update from @MBForex here:https://t.co/GhpA2pJJqL https://t.co/sDuE9WdDEg
USD at Risk for Further Losses as Consumer Confidence Wanes

USD at Risk for Further Losses as Consumer Confidence Wanes

David Song, Strategist

- Conference Board’s Sentiment Survey Has Held Above 80 Since May

- Lowest 2013 Reading Was 58.4 in January; Highest Was 82.1 in June

Trading the News: U.S. Consumer Confidence

A decline in the U.S. Consumer Confidence survey may prompt a bearish reaction in the U.S. dollar as it dampens the prospects for a stronger recovery.

What’s Expected:

Time of release:09/24/2012 14:00 GMT, 10:00 EDT

Primary Pair Impact: EURUSD

Expected: 80.0

Previous: 81.5

DailyFX Forecast: 78.0 to 82.0

Why Is This Event Important:

As a result, a dismal development may also dampen the prospects of seeing the Federal Open Market Committee (FOMC) taper its asset-purchase program at the October 29-30 meeting, and the central bank may continue to delay its exit strategy in an effort to further insulate the world’s largest economy.

Expectations: Bearish Argument/Scenario

Release

Expected

Actual

U. of Michigan Confidence (SEP P)

82.0

76.8

Consumer Credit (JUL)

$12.700B

$10.437B

Change in Non-Farm Payrolls (AUG)

180K

169K

The slowdown in private sector credit along with the ongoing weakness in the labor market may drag on household sentiment, and a marked decline in the survey may further diminish the appeal of the USD as the central bank sticks to its highly accommodative policy stance.

Risk: Bullish Argument/Scenario

Release

Expected

Actual

Existing Home Sales (MoM) (AUG)

-2.6%

1.7%

Average Hourly Earnings (YoY) (AUG)

2.1%

2.2%

Gross Domestic Product (QoQ) (Annualized) (2Q P)

2.2%

2.5%

Nevertheless, the more broad-based recovery in the U.S. economy along with the pickup in wage growth may prop up consumer confidence, and another uptick in household sentiment may encourage a more meaningful rebound in the greenback as it raises the arguments to scale back on quantitative easing.

How To Trade This Event Risk(Video)

For Full Coverage of the U.S. Consumer Confidence survey, Join Analyst on Demand

Bearish USD Trade: Conference Board Survey Narrows to 80.0 or Lower

  • Need green, five-minute candle after the report to consider a long EURUSD trade
  • If the market reaction favors a bearish dollar trade, establish long EURUSD with two position
  • Place stop at the near-by swing low/reasonable distance from entry with at least 1:1 risk-to-reward
  • Move stop to cost on remaining position once initial target is met; set reasonable limit

Bullish USD Trade: Sentiment exceeds market forecast

  • Need red, five-minute candle following the release to look at a short EURUSD entry
  • Carry out same strategy as the bearish USD trade, just in reverse

Potential Price Targets For The Release

EURUSD Daily

Forex_USD_at_Risk_for_Further_Losses_as_Consumer_Confidence_Wanes_body_Picture_2.png, USD at Risk for Further Losses as Consumer Confidence Wanes

Chart - Created Using FXCM Marketscope 2.0

  • Fourth Failed Attempt to Close Above the 1.3530-40 (61.8% Fib expansion)
  • Relative Strength Index Fails to Maintain Bullish Momentum; Turns Around Ahead of 70
  • Interim Resistance: 1.3650 (78.6 expansion) to 1.3710 (2013 high)
  • Former Resistance to Offer Support: 1.3360 (38.2 expansion) to 1.3380 Pivot

Impact that the U.S. Consumer Confidence survey has had on USD during the last month

Period

Data Released

Estimate

Actual

Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

AUG 2013

08/27/2013 14:00 GMT

79.0

81.5

+6

+6

August 2013U.S. Consumer Confidence

Forex_USD_at_Risk_for_Further_Losses_as_Consumer_Confidence_Wanes_body_ScreenShot134.png, USD at Risk for Further Losses as Consumer Confidence Wanes

U.S. consumer sentiment bounced back in August, with the Conference Board survey advancing to 81.5 from a revised 81.0 the month prior, while 67.9% of respondents anticipate higher borrowing costs going forward as the Fed looks to taper its asset-purchase program in the coming months. The initial market reaction was short-lived, with the EURUSD quickly trading back above the 1.3380 region, and the greenback continued to consolidated throughout the day as the pair closed at 1.3390.

--- Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com

Follow me on Twitter at @DavidJSong

To be added to David's e-mail distribution list, please follow this link

Trade Key Event Risks with DailyFX on Analyst on Demand

Looking to use the DailyFX Trade Signals LIVE? Check out Mirror Trader

New to FX? Fill Out This Quick Form for a Free Tutorial

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES