U.S. Pending Home Sales Spike To Record High In August

Trading 30 sept 2020 Commentaire »

Partly reflecting tremendously low mortgage rates, the National Association of Realtors released a report on Wednesday showing pending home sales in the U.S. jumped to a record high in the month of August.

NAR said its pending home sales index spiked by 8.8 percent to 132.8 in August after surging up by 5.9 percent to 122.1 in July. Economists had expected pending home sales to increase by 3.2 percent.

A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.

"Tremendously low mortgage rates - below 3% - have again helped pending home sales climb in August," said Lawrence Yun, NAR's chief economist. "Additionally, the Fed intends to hold short-term fed funds rates near 0% for the foreseeable future, which should in the absence of inflationary pressure keep mortgage rates low, and that will undoubtably aid homebuyers continuing to enter the marketplace."

He added, "While I did very much expect the housing sector to be stable during the pandemic-induced economic shutdowns, I am pleasantly surprised to see the industry bounce back so strongly and so quickly."

The much bigger than expected increase in pending home sales came as all four regional indices recorded increases in contract activity on a month-over-month basis in August.

Pending home sales in the West spiked by 13.1 percent, while pending sales jumped by 8.6 percent in both the Midwest and South. The Northeast saw a 4.3 percent surge in pending home sales.


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*U.S. Crude Oil Inventories Drop By 2.0 Million Barrels In Week Ended 9/25

Trading 30 sept 2020 Commentaire »

U.S. Crude Oil Inventories Drop By 2.0 Million Barrels In Week Ended 9/25


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Dollar Little Changed After U.S. Pending Home Sales

Trading 30 sept 2020 Commentaire »

At 10:00 am ET Wednesday, U.S. pending home sales for August have been released. The greenback changed little against its major counterparts following the data.

The greenback was trading at 105.72 against the yen, 0.9236 against the franc, 1.2859 against the pound and 1.1698 against the euro around 10:04 am ET.


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*U.S. Pending Home Sales Spike 8.8% In August

Trading 30 sept 2020 Commentaire »

U.S. Pending Home Sales Spike 8.8% In August


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Dollar Mixed Ahead Of U.S. Pending Home Sales

Trading 30 sept 2020 Commentaire »

At 10:00 am ET Wednesday, U.S. pending home sales for August are due. Ahead of the data, the greenback traded mixed against its major counterparts. While the greenback fell against the pound, it rose against the rest of major counterparts.

The greenback was worth 105.72 against the yen, 0.9239 against the franc, 1.2856 against the pound and 1.1696 against the euro as of 9:55 am ET.


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*Chicago Business Barometer Jumps To 62.4 In September

Trading 30 sept 2020 Commentaire »

Chicago Business Barometer Jumps To 62.4 In September


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Analytics and trading signals for beginners. How to trade EUR/USD on October 1. Analysis of Wednesday’s trade. Getting ready

Trading 30 sept 2020 Commentaire »

1-hour chart of EUR/USD

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On Wednesday, September 30, EUR/USD was trading again in a complicated way, especially for beginners. After the price had fixed above the downward channel, the trajectory changed into the upward one. On Wednesday morning, I warned that the pair was about to begin a downward correction because the price climbed 120 pips. Besides, the pair needed a downward retracement in any case so that the MACD indicator could lose steam and traders could use it again to open long positions. That's exactly what has happened today. The pair has started a moderate correction. As a result, the price declined to 1.1687. However, this correction finished rapidly and sharply. The price regained all losses with literally one bar. At the same time, the currency pair managed to hit a higher high following the previous one (1.1755). Well, the situation is rather difficult for understanding. The correction is underway and it is not over yet. Moreover, it is getting more complicated. It would have been wrong to open long positions with the MACD signaling upwards. Why? First, it is getting too late at night. Second, the move upwards began abruptly that always looks suspicious. To sum it up, I would recommend wait for a new round of correction.

On Wednesday, there has been a series of interesting events. Nevertheless, most of them have made no impact on EUR/USD. I'm not going to expand on the televised debate between Donald trump and Joe Biden. This political event was of no importance for the US dollar. The same is true about a report on Q2 US GDP that came in better than expected. ADP employment report also revealed stronger employment in the US private sector in September than the market had projected. Both reports are upbeat. However, the US dollar has not found much support from them. In fact, none of the fundamental events of the day influenced the EUR/USD pair.

On Thursday, October 1, the economic calendar contains a batch of manufacturing PMIs for the EU and the US. Another report to take notice is the unemployment rate in the Eurozone for August. As usual, traders monitor weekly updates on initial unemployment claims for the US. Basically, none of these reports will impact on the EUR/USD trajectory. The exception is the composite PMI for the Eurozone or the US provided that it turns out to be lower than the flash estimate, especially if it sinks below 50.0 points. Thus, I reckon that macroeconomic data which is due tomorrow will be of little importance for EUR/USD.

On October 1, the following scenarios are possible

1)At present, it would be a good idea to plan buying the pair because traders managed to overcome the upper border of the downward channel. Nevertheless, it is common knowledge that the pair always needs correction. So, I believe that a correctional stage will continue. Thus, it is recommended to open buy orders not until the correction is over. Once it is complete, it would be possible to plot the upward trend line. The upward targets are 1.1771 and 1.1801.

2)Traders reject the selling idea because the downward channel has been breached. So, there is a chance for the pair to resume even the downtrend, but the technical picture is in favor of the uptrend. In other words, the development of a new downtrend or cancellation of the uptrend will support the idea of selling. But this scenario has not been confirmed yet.

What's on the chart:

Support and Resistance levels are the levels that are targets when opening buy or sell orders. Take Profit levels can be placed near them.

Red lines are channels or trend lines that display the current trend and show which direction it is preferable to trade now.

Up / down arrows show whether the pair should be traded up or down when reaching or overcoming particular obstacles.

MACD indicator (10,20,3) - a histogram and a signal line. When they are crossed, this signals a market entry. It is recommended for use in combination with trend lines (channels, trend lines).

Important speeches and reports in the economic calendar can greatly influence the movement of the currency pair. Therefore, during their release, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

Beginners in the forex market should remember that every trade cannot be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.

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U.S. Private Sector Job Growth Exceeds Estimates In September

Trading 30 sept 2020 Commentaire »

Private sector employment in the U.S. surged up by more than expected in the month of September, according to a report released by payroll processor ADP on Wednesday.

ADP said private sector employment spiked by 749,000 jobs in September after jumping by an upwardly revised 481,000 jobs in August.

Economists had expected employment to increase by 650,000 jobs compared to the addition of 428,000 jobs originally reported for the previous month.

"In September, the majority of sectors and company sizes experienced gains with trade, transportation and utilities; and manufacturing leading the way," said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. "However, small businesses continued to demonstrate slower growth."

The report said employment in the service-providing sector spiked by 552,000 jobs, while the goods-producing sector added 196,000 jobs.

Employment at small businesses rose by 192,000 and employment at medium and large businesses jumped by 259,000 jobs and 297,000 jobs, respectively.

On Friday, the Labor Department is scheduled to release its monthly employment report, which includes both public and private sector jobs.

Economists expect employment to surge up by 850,000 jobs in September after spiking by 1.371 million jobs in August. The unemployment rate is expected to dip to 8.2 percent from 8.4 percent.


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Greece Producer Prices Decline Slows, Retail Sales Fall

Trading 30 sept 2020 Commentaire »

Greece producer prices declined at a softer pace in August, data from the Hellenic Statistical Authority showed on Wednesday.

The producer prices index declined 6.6 percent year-on-year in August, following a 7.9 percent fall in July.

On an annual basis, producer prices in the domestic market and non-domestic market decreased by 4.1 percent and 14.3 percent, respectively, in August.

On a monthly basis, producer prices fell 0.2 percent in August, after a 0.8 percent increase in the prior month.

Separate data from the statistical office showed that the retail sales declined 3.0 percent year-on-year in July, following a 3.3 percent decrease in June

On a monthly basis, retail sales declined 1.1 percent in July, after a 2.2 percent rise in the preceding month.


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EUR/USD. Weak euro, weak dollar: conflicting signals keep the pair in the grip of a flat

Trading 30 sept 2020 Commentaire »

The euro/dollar pair continues to show contradictory dynamics. The US dollar index, which initially ignored the debate between Trump and Biden, began to gain momentum at the start of the US session on Wednesday. According to a CNN poll, the head of the White House lost the first round of a verbal duel. This fact provided small support to the greenback, which showed itself in almost all dollar pairs. The European currency, in turn, continued its downward movement throughout the market, amid a decline in German inflation and unexpected statements from the ECB representative. Also, today, the lower house of the British Parliament still adopted the scandalous bill "on the internal market of the UK", crossing out some points of the Brexit agreement and jeopardizing the conclusion of a trade deal. News from London also undermined the euro's position, adding to the negative fundamental picture.

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However, let's start with American events. As mentioned above, traders initially ignored the debate of candidates for the post of President of the United States, although this event is the most important stage of the election race. Such a phlegmatic reaction was because it was impossible to determine a clear winner based on the results of the "battle". Trump showed his assertiveness, however, Biden did not look like a "whipping boy". If you believe the results of a CNN poll, the speech of the democratic leader was liked by 60% of viewers, while Trump scored only 28% of likes. If we look at the structure of the survey, we will see that 65% of respondents believe that Biden's answers were "more truthful", and his claims to the current President are "fairer". Trump has these indicators at 29% and 32%, respectively.

Similar surveys of local TV channels show similar results. Therefore, with a certain degree of probability, we can assume that the first round of the debate remained for Biden. Against this background, the dollar gained at price, although it remained paired with the euro in a wide-range flat. The US economy growth data for the second quarter published today did not help the American either. The final figures were revised to improve, but given the "depth of the fall", they remained in negative territory. So, the volume of US GDP decreased in the second quarter by -31.4% (initial estimate – 31.7%), the price index of GDP fell by 1.8% (instead of a two-percent decline). As you can see, the indicators "improved" very slightly, so the market ignored this release.

Dollar bulls also ignored the ADP report, which came out better than expected. According to experts of this agency, the number of people employed in the US private sector in September increased by 749 thousand (with a forecast of growth of 650 thousand). However, traders ignored this release due to its low correlation with Non-Farm (for several months, indicators were released randomly, although previously a high level of correlation with the official report was recorded).

On the other hand, the greenback is still under background pressure due to political differences between Republicans and Democrats. Today, US Treasury Secretary Steven Mnuchin said that approximately by Friday, it will be clear whether representatives of both parties and representatives of the White House will be able to find a common denominator in the adoption of the financial assistance program. Given the fact that the Democrats introduced their bill for $ 2.2 trillion on Monday, we can assume that the parties will not sit down at the negotiating table.

The European currency, in turn, also can not show character against the background of recent events. In particular, data on the growth of German inflation for September were published yesterday. The indicators disappointed traders: both in monthly and annual terms, they went further into the negative area. It is worth noting that on Friday, pan-European inflation indicators will be published, so negative signals from Germany alerted investors.

Also, the European currency was under pressure for another reason. The fact is that today the ECB member Francois Villeroy de Galo (the head of the Central Bank of France) made an unexpected statement, saying that the European regulator will take a course on the average inflation target. In other words, the official admitted that the ECB could go the Fed's way. Let me remind you that at the end of August, the Federal Reserve revised its monetary policy strategy, becoming more "tolerant" of rising inflation. The new strategy of the US Central Bank allows the regulator to keep base rates at the current record low level for a longer time. Figuratively speaking, the Federal Reserve agreed to "tolerate" inflation at a level above two percent, without tightening the parameters of monetary policy. This fact put a lot of pressure on the dollar.

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And so, the ECB members want to adopt a similar strategy. It is noteworthy that the European currency reacted rather weakly to Villeroy's words. This can be explained by two factors. First, the head of the Bank of France only allowed such a scenario. Whether his colleagues will support him in this matter is an open question. Secondly, the target level of the European Central Bank is currently too far from the current values to make any calculations in the context of time benchmarks. Therefore, market participants, after some fluctuations (after Villeroy's speech, there was increased volatility), decided not to panic ahead of time.

Thus, an ambiguous fundamental picture emerges in the "dry balance". Both the dollar and the euro are showing weakness and uncertainty. This is the reason for today's flat: traders can't "catch on" to one or another fundamental factor to get the pair out of the price range of 1.1805-1.1630. The "ceiling" of this corridor corresponds to the upper boundary of the Kumo cloud on D1, and the lower level corresponds to the lower line of the Bollinger Bands indicator on the same timeframe. When approaching the upper limit of the range, it is advisable to consider short positions.

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