Sep 01 2008
Labor Day - US Market Is Closed.
Last week, the USD went through some choppy waters while showing mixed results against the majors. The greenback gained a respectable 100 pips versus the EUR closing at 1.4670, also making strides against the GBP and CHF. The USD did experience some bearishness against the JPY, due to a strong news week by the Asian powerhouse. Last week’s results were driven largely by strong US economic indicators, as positive data pushed the Greenback. Housing sector figures were surprisingly positive, as both Existing and New Home Sales, pushed the market toward favorable Dollar sentiment. Traders also saw a bullish dollar following an unexpected rise in Core Durable Goods, and what took many by surprise, a 3.3% rise in quarterly GDP.
This week should bring high volatility for the Dollar as many crucial news events will take place. ISM Manufacturing PMI is expected on Tuesday and will look to set a mark before we approach a very important end to the first week of September. Thursday will be a big day with ADP Non-Farm Employment Change and the ISM Non-Manufacturing PMI indicators forecasted for release. It has been the case in recent months that a disparity between ADP’s forecast of Non-Farm payrolls and the actual release a day later from the U.S Labor Department has caused huge swings in the dollar’s movement most notably against the majors. Traders should start the week looking to set up positions for what could be a big week in the Forex market. Also expected on Friday along with Non-Farm Payrolls is the US Unemployment Rate, both of which are forecasted to be bearish and close the week with great volatility. Forecasts show a large portion of the data from the US this week as negative; this, along with the developments of Hurricane Gustav could hurt USD prices this week
Today Labor Day is celebrated in the USA and volatility will likely be low, expect the direction of the USD to be dictated by it counterparts.
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