Tuesday, 25 Aug 2009

USD Trading to be Determined by CB Consumer Confidence Report

Today, USD trading is set to be determined by the release of the CB Consumer Confidence report from the U.S. at 14:00 GMT. The figure is expected to be 48.1, better than the previous figure of 46.6. This release is a leading indicator of consumer spending, which is a crucial indicator for the health of the U.S. economy. Positive figures are likely to lead to increased risk appetite, and a further weakening of the Dollar.

So far today, the USD is trading lower vs. the EUR by 26 pips at the 1.4326 level. The GBP/USD pair continues its trend of bearishness, as the British economy is still in dire straits. Against the JPY, the USD is virtually unchanged at the 94.06 level. This behavior may be due to some indecision amongst investors as to the desired outcome of this pair today. Additionally, today's crucial consumer confidence release from the U.S. today will determine this pair's outcome for today and the rest of the week.

In the meantime, you should look to open big positions in the USD's major crosses, such as the GBP, EUR, AUD and JPY. It is also recommended that you follow the release of the HPI (House Price Index) publication at 14:00 GMT. This is more likely to set the rate for the strength of the U.S. Dollar over the course of this week, as many forex traders continue to trade on the health of the U.S. housing market.