USD Weekly Forecast (Feb. 24 – 28)

USD Weekly Forecast (Feb. 24 – 28)

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Another week, another chance to trade the dollar!

Here’s a list of potential catalysts you should keep an eye on in the next few days.

Durable goods orders (Feb 27, 1:30 pm GMT)

  • New durable goods orders gained 2.4% in December after a 3.1% decline in November
  • Core durable goods slipped by 0.1% when analysts had priced in a 0.4% increase
  • Non-defense spending – a proxy for overall business spending – dropped by the most in eight months and suggested investment contraction in Q4 2019
  • USD reaction was mixed as there were other lower-tier reports printed at the same time

Core PCE price index (Feb 28, 1:30 pm GMT)

  • Core personal consumption expenditures (PCE) is widely considered as the Fed’s preferred inflation gauge
  • Core PCE price index rose by 1.6% from a year ago in December, missing the Fed’s 2.0% target for another month
  • Analysts see the monthly reading maintaining its 0.2% growth, which could raise the annualized figure to 1.7% as last year’s weak data drops off the calculation

Lower tier reports

  • CB consumer confidence (Feb 25, 3:00 pm GMT) could improve from 131.6 to 132.0 in February
  • New home sales (Feb 26, 3:00 pm GMT) is seen higher from 694K to 710K in January
  • Preliminary (second) GDP reading (Feb 27, 1:30 pm GMT) to be revised higher from 2.1% to 2.2%?

FOMC members’ speeches

  • Loretta Mester (Feb 24, 8:00 pm GMT) will talk economic outlook and monetary policy in DC
  • Robert Kaplan (Feb 25, 2:45 pm GMT) will attend a real estate symposium in Kansas City
  • Richard Clarida (Feb 25, 8:00 pm GMT) will also talk economy and monetary policy in DC
  • Robert Kaplan (Feb 26, 2:45 pm GMT) is expected at a conference in Austin
  • Neel Kashkari (Feb 26, 6:00 pm GMT) has a speech titled “What You May Not Know About the Minneapolis Federal Reserve” in Minneapolis
  • Mester (Feb 27, 8:30 pm GMT) will open the “Women in Economics Symposium” in Cleveland and participate in a panel discussion on Feb 28 at 12:00 am GMT
  Trade Idea: USD/CAD Rising Lows Retest?

Technical snapshot

  • Stochastic considers USD as “overbought” against NZD, AUD, JPY, EUR, and CHF on the daily time frame

  • AUD/USD and NZD/USD are trading below their short AND long-term EMAs on the daily
  • EUR/USD is a hair’s breadth away from AUD/USD and NZD/USD’s conditions
  • USD/JPY and USD/CAD are trading above their short AND long-term EMAs
  • GBP/USD is trading above its 200 EMA but below its shorter-term EMAs. Watch for retracement or reversal opportunities

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