Dismal U.S. Consumer Confidence Survey to Curb EUR/USD Weakness
- Conference Board’s U.S. Consumer Confidence to Narrow for Second Consecutive Month in April to 126.0 from 127.7 the Month Prior.
- EUR/USD Eyes March-Low (1.2155) Amid Rising U.S. Treasury Yields. Relative Strength Index (RSI) Snaps Bullish Formation From Late-2017.
Trading the News: U.S. Consumer Confidence
A considerable deterioration in household sentiment may trigger a bearish reaction in the U.S. dollar as it dampens the outlook for growth and inflation, and the Federal Open Market Committee (FOMC) may stick to the current script at the next interest rate decision on May 2 amid ‘incoming data suggesting some slowing in the rate of growth of household spending and business fixed investment after strong fourth-quarter readings.’
However, a positive development may push the FOMC to implement higher borrowing-costs throughout 2018, and the rise in U.S Treasury yields may keep the greenback bid as ‘members expected that economic conditions would evolve in a manner that would warrant further gradual increases in the federal funds rate.’ Sign up and join DailyFX Currency Analyst David Song LIVE to cover the updates to the U.S. Consumer Confidence survey.
Impact that the U.S. Consumer Confidence survey has had on EUR/USD during the last print
|Period||Data Released||Estimate||Actual||Pips Change||Pips Change|
|03/27/2018 14:00:00 GMT||131.0||127.7||+5||+11|
March 2018 U.S. Consumer Confidence
EUR/USD 5-Minute Chart
The Conference Board’s U.S. Consumer Confidence survey unexpectedly slipped to 127.7 from a revised 130.0 in February, with the gauge for future expectations highlighting a similar dynamic as the index narrowed to 106.2 from 109.2 during the same period. The greenback struggled to hold its ground following the dismal print, with EUR/USD grinding higher throughout the day to close at 1.2402.
EUR/USD Daily Chart
- EUR/USD may continue to give back the advance from earlier this year as it clears the 1.2230 (50% retracement), with the pair at risk for a run at March-low (1.2155) as the Relative Strength Index (RSI) snaps the bullish formation carried over from late last year.
- Next downside hurdle comes in around 1.2130 (50% retracement), with a break/close below the state region opening up the next region of interest around 1.1960 (38.2% retracement) to 1.1970 (23.% expansion).
For more in-depth analysis, check out the Q2 Forecast for EUR/USD
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--- Written by David Song, Currency Analyst
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