Forex traders who are mostly long on the USD this year
received positive news as the markets slowed down in anticipation of the Easter
holiday. Prior to the public address by Federal Reserve Chair Janet Yellen,
forex observers and analysts had expected that inflationary data would continue
to point towards a gradual economic recovery for the United States. For the
most part, this was the case; however, the manufacturing sector continued to
lag behind.
A Weeklong USD Rally
The prospect of future monetary policy action did not intimidate greenback traders who enjoyed a rally that lasted from Palm Sunday to Good Friday. Yellen admitted that the labor market still exhibits significant slack, and that long-term unemployment and salary prospects are not presenting ideal strength.
In terms of inflation, Yellen does not foresee a great risk of inflation climbing over two percent. In fact, she mentioned a greater likelihood of inflation remaining under that level. These comments brought about enthusiasm in the forex markets and the EUR/USD currency pair in particular.
Other positive indicators mentioned by Yellen included retail sales and consumer spending. Traders were pleased yet cautious as they did not like the significant in manufacturing 5.6 to 1.3 percent. Still, traders held their positions and realized midweek gains from the USD before waiting on the unemployment claims reports and the detailed manufacturing report from the Philadelphia Fed on Thursday.
Stronger Data Bolsters the Greenback
On Thursday, April 17th, traders paid attention to the thorough manufacturing and unemployment reports. Although the number of unemployment claims rose from the previous report, analysts had expected around 316,000. In the end, labor figures were more optimistic with 304,000 claims and the Philly Fed Manufacturing Index posted a strong gain from 9.0 in March to 16.6 in April. As economists had predicted only a modest gain for this key index, the response by forex traders was strong with regard to long positions on the USD.
With better-than-expected jobs and manufacturing data, the greenback enjoyed a bolstering week in all major currency pairs. Even as trading activity cooled off on Good Friday and got off to a slow start the Monday after Easter, the USD was still finding strong support against the yen and the Canadian dollar.
A few traders were applying a contrarian view and placing sell orders on the USD as the major financial exchanges closed on late Monday afternoon. Still, the majority of retail forex traders were still feeling pretty bullish on the greenback and the overall U.S. economic recovery.
A Weeklong USD Rally
The prospect of future monetary policy action did not intimidate greenback traders who enjoyed a rally that lasted from Palm Sunday to Good Friday. Yellen admitted that the labor market still exhibits significant slack, and that long-term unemployment and salary prospects are not presenting ideal strength.
In terms of inflation, Yellen does not foresee a great risk of inflation climbing over two percent. In fact, she mentioned a greater likelihood of inflation remaining under that level. These comments brought about enthusiasm in the forex markets and the EUR/USD currency pair in particular.
Other positive indicators mentioned by Yellen included retail sales and consumer spending. Traders were pleased yet cautious as they did not like the significant in manufacturing 5.6 to 1.3 percent. Still, traders held their positions and realized midweek gains from the USD before waiting on the unemployment claims reports and the detailed manufacturing report from the Philadelphia Fed on Thursday.
Stronger Data Bolsters the Greenback
On Thursday, April 17th, traders paid attention to the thorough manufacturing and unemployment reports. Although the number of unemployment claims rose from the previous report, analysts had expected around 316,000. In the end, labor figures were more optimistic with 304,000 claims and the Philly Fed Manufacturing Index posted a strong gain from 9.0 in March to 16.6 in April. As economists had predicted only a modest gain for this key index, the response by forex traders was strong with regard to long positions on the USD.
With better-than-expected jobs and manufacturing data, the greenback enjoyed a bolstering week in all major currency pairs. Even as trading activity cooled off on Good Friday and got off to a slow start the Monday after Easter, the USD was still finding strong support against the yen and the Canadian dollar.
A few traders were applying a contrarian view and placing sell orders on the USD as the major financial exchanges closed on late Monday afternoon. Still, the majority of retail forex traders were still feeling pretty bullish on the greenback and the overall U.S. economic recovery.
Such kind of forex market information along with best forex signals for trading major currency pairs, is a treat to watch.
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