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.

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
EUR/USD
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Oil - US Crude
Mixed
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Mixed
Gold
Mixed
GBP/USD
Bearish
USD/JPY
Mixed
More View more
Real Time News
  • Forex Update: As of 16:00, these are your best and worst performers based on the London trading schedule: 🇬🇧GBP: 0.20% 🇪🇺EUR: -0.26% 🇨🇭CHF: -0.35% 🇨🇦CAD: -0.44% 🇳🇿NZD: -0.99% 🇦🇺AUD: -1.00% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/3KGtHyMLEM
  • Fed's Rosengren says he is less optimistic against other forecasters in Fed - BBG
  • Fed Chair Powell: - Studying what caused dysfunction in Treasury market back in March - DJ via BBG
  • Indices Update: As of 16:00, these are your best and worst performers based on the London trading schedule: France 40: -0.25% Germany 30: -0.33% FTSE 100: -0.36% Wall Street: -0.48% US 500: -0.84% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/0ZaXkoSq3u
  • $Gold down to that next support zone, closer and closer to fresh two-month-lows https://t.co/0ecO64jQQc https://t.co/H3eF5Wyi8P
  • Hey traders! Get your Wednesday market update from @DailyFX Chief Strategist @JohnKicklighter 👇 https://t.co/qJimv2rgqB
  • US Dollar Extends Rally as Global PMI Data Fans Volatility Full Analysis via @DailyFX: https://www.dailyfx.com/forex/market_alert/2020/09/23/us-dollar-extends-rally-as-global-pmi-data-fans-volatility.html $USD $DXY $EURUSD #FX #Forex #Trading https://t.co/5qBKKha4ud
  • US 154-Day Bills Draw 0.100% Primary Dealers Awarded: 63.6% Indirect Bidders Accepted: 32.3% Direct Bidders Accepted: 4.1% B/C Ratio: 3.29
  • The planned UK budget this fall is cancelled according to government official - BBG
  • Fed Chair Powell: - Would be very difficult to create a facility that reaches small businesses
EUR/USD Risks Fresh Monthly Highs on Strong Euro-Zone GDP Report

EUR/USD Risks Fresh Monthly Highs on Strong Euro-Zone GDP Report

2015-08-14 05:00:00
David Song, Shuyang Ren,
Share:

- Euro-Zone 2Q GDP to Expand Annualized 1.3%- Fastest Pace of Growth Since 3Q 2011.

- Will Faster Growth Spark a ‘Taper Tantrum’ as GDP Picks Up for Three-Straight Quarters?

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

Trading the News: Euro-Zone Gross Domestic Product (GDP)

The Euro-Zone’s 2Q Gross Domestic Product (GDP) report may boost the appeal of the single currency and spur fresh monthly highs in EUR/USD as the growth rate is expected to increase 1.3% following the 1.0% expansion during the first three-months of 2015.

What’s Expected:

EUR/USD GDP

Click Here for the DailyFX Calendar

Why Is This Event Important:

Despite the European Central Bank’s (ECB) pledge to ‘fully implement’ its quantitative easing (QE) program, data prints pointing to a stronger recoverymay encourage the Governing Council to adopt an improved outlook for the region, and the board remains at risk of facing a ‘taper tantrum’ over the medium-term as central bank President Mario Draghi remains confident in achieving the one and only mandate for stability.

Expectations: Bullish Argument/Scenario

Release

Expected

Actual

Business Climate Indicator (JUL)

0.19

0.39

M3 Money Supply (3M) (JUN)

5.1%

5.1%

Sentix Investor Confidence (JUL)

15.0

18.5

Improved confidence along with the pickup in private-sector lending may generate a strong GDP figure, and a positive development may spur a bullish reaction in the euro as it dampens the ECB’s scope to further embark on its easing cycle.

Risk: Bearish Argument/Scenario

Release

Expected

Actual

Industrial Production s.a. (MoM) (JUN)

-0.1%

-0.4%

Retail Sales (MoM) (JUN)

-0.2%

-0.6%

Trade Balance s.a. (MAY)

22.0B

21.2B

However, slowing outputs paired with the ongoing weakness in private-sector spending may drag on the growth rate, and a dismal print may undermine the near-term advance in EUR/USD as it raises the risk of seeing the ECB implement more non-standard measures.

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

How To Trade This Event Risk(Video)

Bullish EUR Trade: 2Q GDP Expands Annualized 1.2% or Greater

  • Need green, five-minute candle following a positive growth report to consider a long EUR/USD trade.
  • If market reaction favors a bullish Euro trade, buy EUR/USD with two separate position.
  • Set stop at the near-by swing low/reasonable distance from cost; at least 1:1 risk-to-reward.
  • Move stop to entry on remaining position once initial target is met, set reasonable limit.

Bearish EUR Trade: Euro-Zone Growth Rate Disappoints

  • Need red, five-minute candle to favor a short EUR/USD trade.
  • Implement same strategy as the bullish euro trade, just in reverse.

Read More:

GBPAUD Putting in a High or Time to Buy?

Price & Time: Dow 30 - "Death Cross" Or Just A Simple Crossover?

Potential Price Targets For The Release

EURUSD Daily

EUR/USD Daily Chart

Chart - Created Using FXCM Marketscope 2.0

  • Policy divergence between the ECB/Fed continues to foster a long-term bearish outlook for EUR/USD, but the pair may face a larger correction in the days ahead as long as the Relative Strength Index (RSI) preserves the bullish momentum carried over from the previous month.
  • DailyFX Speculative Sentiment Index (SSI)shows the retail crowd remains net-short EUR/USD since March 9, but the ratio has come off of recent extremes as it narrows to -2.05, with 33% of traders long.
  • Interim Resistance: 1.1180 (23.6% expansion) to 1.1210 (61.8% retracement)
  • Interim Support: 1.0790 (50% expansion) to 1.0800 (23.6% expansion)

Impact that Euro-Zone GDP has had on EUR/USD during the last quarter

Period

Data Released

Estimate

Actual

Pips Change

(1 Hour post event )

Pips Change

(End of Day post event)

1Q A 2015

05/13/2015 09:00 GMT

1.0%

1.0%

+32

+86

1Q 2015 Euro-Zone Gross Domestic Product (GDP)

EUR/USD Chart

The euro-area grew at the fastest pace in 2-years as the growth rate increased an annualized 1.0% following the 0.9% expansion during the last three-months of 2014. Despite the dovish tone held by the European Central Bank (ECB), positive developments coming out of the real economy may encourage a growing dissent within the Governing Council, and the central bank may come under pressure to scale-back its asset-purchase program as the region appears to be getting on a firmer footing. The Euro rallied following the pickup in GDP, with EUR/USD climbing above the 1.1300 handle to end the North American trade at 1.1353.

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

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 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.

DISCLOSURES