Strong US GDP supported dollar

29 March, 2018

For two days, USD dollar looks stronger. Today, US currency continues to recover its positions on good statistical data. On the contrary, European currency has strengthened the decline and in general, euro is going through a weak day, approaching new support in the region of $ 1.2340. $1.2385 support level was broken in European session and the decline intensified after the release of positive figures for US fourth quarter GDP. The growth of US 2017 GDP for the fourth quarter was 2.9% instead of the expected 2.6%. The sale of pending houses increased by 3.1%, with 2.5% expectations. Such strong and positive data on the American economy has not been received for a long time.

The dollar is also within yesterday's range against the yen. USD / JPY completed the last week lower JPY105.30, but returned above this support since the moment of recovery on Monday.

Yesterday, the British pound surprised everyone with its volatility, given the lack of important news at the market. The attempt for further gains in the direction of 1.43 turned into a wave of sales, which is primarily due to technical issues.

On the contrary, the overall fundamental background for the British currency remains very positive. The statistical data published last week, as well as the decision of the Bank of England, raise expectations of an soon rate-hike in the country.

GBP/USD pair approached the highs of the year and tried to gain a foothold above the 1.42 mark. Traders began to consider this area as an area for partial profit taking on long positions at the end of the first quarter of 2018.

Today, American exchanges opened neutrally. The DOW and SP 500 indexes try to win back yesterday's losses, while sales in high-tech sector continue, putting pressure on the high-tech NASDAQ. It should be noted that the markets are oversold after yesterday's sale-off and any insignificant positive news can trigger the technical upward pullback. American statistics are also capable of supporting US stock markets today.

Oil prices recovered a part of their previous losses after the US Energy Information Administration reported that oil supplies rose by 1.6 million barrels in the week ending March 23.

 Analysts forecast an increase of 1 million barrels, while the American Petroleum Institute reported a jump of 5.3 million barrels. Gasoline stocks fell 3.5 million barrels per week, while distillate stocks fell by 2.1 million barrels, according to the EIA.


Source   Presented by Fort Financial Services
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