US Dollar Tumbles as Q3 GDP Falls 0.5% Amidst Sharpest Contraction in Consumption Since 1980
It seems that the announcement of yet another Federal Reserve lending facility - this time to support consumer and small business loans - and additional bailout measures for Fannie Mae, Freddie Mac, and Ginnie Mae totaling $800 billion didn’t encourage investors. Instead, traders focused on the revision of US GDP for the third quarter down to -0.5 percent compared to the advance reading of -0.3 percent, which signals the worst US economic slowdown in seven years. The decline was led by a 3.7 percent drop in personal consumption, which marks the sharpest contraction since 1980, as the major deterioration of the US labor markets, stagnant wage growth, and a reduction in the availability of credit takes its toll. Meanwhile, the S&P/Case-Shiller Home Price Index tumbled 16.55 percent during the third quarter, which is the worst decline since recordkeeping began in 1988. On the other hand, the Conference Board’s consumer confidence index climbed to 44.9 in November from a record low of 38.8. However, since this latest result is still the second-lowest since 1974, the rise didn’t inspire too much confidence of a rebound in consumer sentiment.
There was something encouraging about today’s dollar decline: the moves suggested that fundamentals are starting to play a role in forex market price action once again. Indeed, there are signs emerging that the financial markets are stabilizing a bit since risk trends have lost some influence on the greenback. Previously, any sort of losses in equities would trigger gains for the US dollar amidst flight-to-quality, but with the Dow Jones Industrial Average barely ending the day higher and the greenback gaining 0.85 percent versus the euro and 1.98 percent against the British pound, it is clear that this relationship has faded a bit. It remains to be seen if this trend will hold, but with upcoming US economic data likely to be disappointing, downside risks may linger for the US dollar.
US Durable Goods Orders are forecasted to have dropped 2.7 percent in October and excluding transportation is anticipated to fall negative for the second consecutive month. Indeed, Boeing orders - a good leading indicator of this headline reading - slumped in October to 14, down from 41 in September. Meanwhile, Personal Income growth during the month of October is anticipated to rise a tepid 0.1 percent while Personal Spending is expected to fall by the most since September 2001 at a rate of 1 percent. Such results would only create additional potential for fourth quarter GDP to be just as disappointing as the third quarter readings, and will likewise lead to increased speculation that the Federal Reserve will cut rates by as many as 50 basis points during their next meeting on December 15-16.
ForexGen Trading Signals
Dash board is an assisting tool that makes strategies combinations where its calculations depend on volumes and correlations between strategies including a function that weights the indicators’ signal depending on strategies based on trend, oscillators, bill Williams, volumes and custom indicator; it gets the average signal among all the strategies over a specific time frame. It shows the buy/sell signals by different strengths in the short, middle and long periods:
- Short strength expected results may take from 2 to 8 hours to produce profit and the expected gain may reach average 20 to 30 pips.
- Middle strength expected results may take from 8 to 24 hours to produce profit and the expected gain may reach an average of 30 to 60 pips.
- Long strength expected results may take from 1 to 5 days to produce profit and the expected gain may reach average 60 to 30 pips.
Indicator features:
- History mode feature that allows traders to get the dash board indications for any point in history.
- The ability to show or hide all strategies.
- The ability to add or remove any strategy from Dash Board calculations.
- Assigning weights for each strategy in Dash Board calculations.
- The ability to store Dash Board values in files.
Dash Board for all indicators
Dashboard for all is an assisting tool that includes 27 currency pairs, it allows traders to see the CIF values for the selected currencies on one chart. It represents the buy/sell signal by a percentage of different strengths (short, long, and middle). The dashboard for all calculations for each currency pair depends on, volumes and correlations between strategies including a function that weights the indicators’ signal depending on strategies based on trend, oscillators, bill Williams, volumes and custom indicator; it gets the average signal among all the strategies over a specific time frame. Dash board for all indicators includes a history mode parameter which allows the trader to get the dash board indication for a historical point for many currencies at any time frame.
Add a Comment
<<Home