Major news for the US Dollar will be coming from the National Association of Realtors with Pending Homes Sales. The announcement will be coming in at 2:00 PM GMT on Monday, July 28, 2014 and will be the only key news for the day. The charts and table below provide more related information.
|Announcement||Forecast||Previous Actual||Previous Forecast|
|MoM Pending Home Sales||0.5%||6.1%||1.5%|
|YoY Pending Home Sales||-8.92%||-5.2%||-8.0%|
Pending Home Sales is considered a leading indicator of the housing market in terms of existing homes which are for resale. It typically leads Existing Home Sales by one to two months because it represents housing sales for which transactions have not yet been closed. The sale of existing houses in the US began to recline in the second half of 2013, now we’re seeing sales pick back up again as our long-term leading indicator approaches 0%.
This is a good sign because a lot of investors look towards the housing market to see how well an economy is doing, especially in the long term. Though the YoY figure is expected to drop again, it is only because around this time last year sales had peaked.
Major pairs affected are the EURUSD and the GBPUSD.
Last week we saw the EURUSD selling off due to the US Dollar strengthening and better than expected US news. So what should we look for tomorrow that will help us enter winning trades? Well, we see that the pair hasn’t seen current levels since November of last year and after last week’s performance we can be sure that the US Dollar is currently dominating the relationship. After falling below its 200 day moving average and not being able to break it again the pair is in selling territory. Tomorrow the US market has the ball in their court with the most important news for tomorrow. A key level to pay attention to is its current support of 1.34269 while if the pair rallies we should see resistance around 1.34541 and 1.34734.
We have a similar situation with the GBPUSD for last week where the pair is in sell territory and due to the US Dollar strengthening and below expected UK announcements and surprising US announcements the pair declines with majority of downside coming in last week Thursday. The pair seems to be stuck within a range since Thursday which will be key levels to look out for. We have support at 1.69651 and resistance around 1.69952. We will see a lot of orders building at support that should hold the pair tough resistance may not hold depending on how announcements come out during the week.