When is the US GDP report and how could it affect EUR/USD?
US Q4 GDP Overview
Thursday's US economic docket highlights the release of Preliminary (revised) US Q4 GDP growth figures, scheduled to be published at 13:30 GMT. The second estimate is anticipated to show that the economic growth in the October-December quarter stood at 2.4% annualized pace, unchanged from the advance estimate.
According to Joseph Trevisani, Senior Analyst at FXStreet – “The small downward adjustment to the December retail spending component is not likely to produce a change in the GDP estimate, though its existence tilts the risk a bit to the negative. Either way the dollar will not be affected, currency traders having more timely concerns.”
How could it affect EUR/USD?
Given the recent concerns over the global outbreak of the deadly coronavirus and its impact on the world economy, a big divergence from the expected reading – though seems unlikely – might be enough to infuse a fresh bout of volatility in the currency markets.
Meanwhile, Yohay Elam offered a brief technical overview of the EUR/USD pair and explained: “Euro/dollar has broken above the uptrend channel that accompanied it since last week. On its way up it also broke above the 100 Simple Moving Average on the four-hour chart and momentum is to the upside. The Relative Strength Index is nearing 70 – which represents oversold conditions.”
“Resistance awaits at 1.0968, which provided support on the way down. It is followed by 1.0980, a support line from early February, and then by 1.1020 and 1.1035. Support awaits at 1.0940, a support line on the way down, followed by 1.0925, a resistance line from mid-February and by 1.0885, which separated ranges several weeks ago. 1.0860, 1.0810, and 1.0777 are next,” Yohay added further.
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About the US GDP
The Gross Domestic Product Annualized released by the US Bureau of Economic Analysis shows the monetary value of all the goods, services and structures produced within a country in a given period of time. GDP Annualized is a gross measure of market activity because it indicates the pace at which a country's economy is growing or decreasing. Generally speaking, a high reading or a better than expected number is seen as positive for the USD, while a low reading is negative.