US GDP In Line With Expectations. |
On Friday, the event of the day was the release of the US Gross Domestic Product. In annualized terms, the GDP grew at a rate of 1.9%. This represents a marginal improvement over what was reported last month, 1.8%, but hardly a reason get excited. If the GDP was a barometer of recovery, one could say that the reading is flat, with no significant changes to report. It turned out that the forecast was correct this time and markets were not surprised by the numbers.
Currencies took the news in stride, with very little response. What was expected to be a pivotal event of the day became a dull moment during an otherwise active period. There were good size price moves both before and after the GDP data, but because the numbers itself did not produce additional volatility, trading ranges for the entire day were within the recent norm. The USD pairs, like the AUD-USD, EUR-USD or the GBP-USD moved about as much as in days before.
In a typical fashion for Friday, I traded short-term price moves at the start of London session. In case of the EUR-USD, the price built a promising tight range in the hours leading to the opening. There was a breakout to the downside, which brought 20 pips gain. On the upside, however, I opted to stay out, thinking that the price was moving too far too fast.
In case of the GBP-USD, another pair I like to use for these trades, the chart did not offer what I consider a good opportunity. The price had already accelerated before London opened for business. Because the range was already extended, I decided to sit it out. There will be better set ups in the future and, hopefully, I will find them. Have a great weekend!
Mike K.
About the author: Mike Kulej
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