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.



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

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View more
EUR/USD Risks Further Decline on Upbeat U.S. Retail Sales Report

EUR/USD Risks Further Decline on Upbeat U.S. Retail Sales Report

David Song, Shuyang Ren,

- U.S. Advance Retail Sales to Increase for the Sixth Time in 2014.

- Rise of 0.6% Would Match Fastest Rate of Growth Since April.

For more updates, sign up for David's e-mail distribution list.

Trading the News: U.S. Advance Retail Sales

The EUR/USD may face a further decline over the next 24-hours of trade should the U.S. Retail Sales report prop up interest rate expectations for the reserve currency.

What’s Expected:

EUR/USD Retail Sales

Click Here for the DailyFX Calendar

Why Is This Event Important:

A marked picked up in private sector consumption may encourage the Federal Open Market Committee (FOMC) normalize monetary policy sooner rather than later, and we may see a growing number of central bank officials adopt a more hawkish tone for monetary policy as the board looks to conclude its asset-purchase program at the October 29 meeting.

Expectations: Bullish Argument/Scenario




Consumer Credit (JUL)



Average Hourly Earnings (YoY) (AUG)



Durable Goods Orders (JUL)



The expansion in private sector credit along with the uptick in wage growth may prompt a strong consumption reading for August, and a better-than-expected print may put increased downside pressure on the EUR/USD as it raises the outlook for growth and inflation.

Risk: Bearish Argument/Scenario




Non-Farm Payrolls (AUG)



ADP Employment Change (AUG)



Personal Consumption Expenditure (PCE) Core (YoY) (JUL)



However, sticky inflation paired with the slowdown in job growth may drag on household spending, and a dismal Retail Sales figure may prompt a larger correction in the dollar as it limits the Fed’s scope to move away from the zero-interest rate policy (ZIRP) ahead of schedule.

How To Trade This Event Risk(Video)

Join DailyFX on Demand for Real-Time Updates on the DailyFX Speculative Sentiment Index (SSI)!

Bullish USD Trade: U.S. Retail Sales Climb 0.6% or Greater

  • Need red, five-minute candle following the release to consider a short trade on EUR/USD
  • If market reaction favors a long dollar trade, sell EUR/USD with two separate position
  • Set stop at the near-by swing high/reasonable distance from entry; look for at least 1:1 risk-to-reward
  • Move stop to entry on remaining position once initial target is hit; set reasonable limit

Bearish USD Trade: Household Consumption Disappoints

  • Need green, five-minute candle to favor a long EUR/USD trade
  • Implement same setup as the bullish dollar trade, just in the opposite direction

Potential Price Targets For The Release



Chart - Created Using FXCM Marketscope 2.0

  • Will continue to favor downside targets as RSI holds in oversold territory & retains bearish momentum.
  • Interim Resistance: 1.3220 (50.0% retracement) to 1.3230 (61.8% retracement)
  • Interim Support: 1.2800 pivot to 1.2810 (61.8% expansion)

Read More:

Price & Time: The AUD/USD Cold Shoulder

AUDUSD Scalps Target Head and Shoulders Break- Bearish Sub 9236

Impact that the U.S. Retail Sales report has had on EUR/USD during the previous month


Data Released



Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

JUL 2014

8/13/2014 12:30 GMT





July 2014 U.S. Advance Retail Sales


U.S. retail sales came in flat from June amid estimates of a 0.2% increase, largely drive by declines in Motor Vehicles, General Merchandise and Department Stores sales. The slowdown in consumption may indicate that the U.S. economy is expanding at a slow pace early on in the third quarter of 2014. The greenback weakened immediate following the dismal print, with the pair EUR/USD climbing above 1.3400, but the market reaction was short-lived as the pair ended the day at 1.3360, only 3 pips above the level prior to the release.

--- Written by David Song, Currency Analyst and Shuyang Ren

To contact David, e-mail Follow me on Twitter at @DavidJSong.

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

Trade Alongsidethe DailyFX Team on DailyFX on Demand

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

New to FX? Watch this Video

Join us to discuss the outlook for the major currencies on the DailyFXForums

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