Thursday, September 25, 2008
ForexYard Indicator Report
| by: Forexyard Be Prepared! U.S. New Home Sales Tomorrow at 14:00 GMT. We at ForexYard encourage our customers to get involved in the most intense market events. As such, we think you should know that the U.S. New Home Sales figures are expected tomorrow, September 25th, 14:00 (GMT), and you need to be prepared. Market events like this one tend to create either big changes to current trends or push current trends even further. Generally, the Majors are the ones most affected by market events in general, but Crude Oil, Gold prices, and even the price of Silver can change dramatically in the seconds after such a publication. For more information about the U.S. New Home Sales, please read below. What is the U.S. New Home Sales? U.S. New Home Sales is a leading economic indicator used to measure the annual number of new single-family homes that were sold during the previous month. While this is a monthly figure, it is reported in an annualized format. This report predominantly helps to validate trends seen in other forward-looking housing indicators, such as the Existing Home Sales. It is a leading indicator of economic health because the sale of a new home impacts a wide variety of consumer spending, such as furniture and appliances that are purchased for the home, a mortgage that's being sold by the financing bank, and brokers that are paid to execute the transaction. Also important is the inclusion of mandatory and optional insurance on these new homes. As a result of the mortgage crisis in the U.S., which has continued to threaten world markets, the importance of the housing sector has increased significantly. If the Survey Comes Inline with Market Forecasts Expectations for this month are suggesting that the U.S. New Home Sales will reach 510K in August, reflecting a 5K decrease since July. Such a result could demonstrate a shrinking housing sector in the U.S., which has been one of the U.S. economy's greatest concerns. It is widely known that this crisis was initiated as a result of the non-covered mortgages that dropped mortgage banks one by one, and have just recently taken the 160-year-old Lehman Brothers bank to the point of filing for bankruptcy protection. A decreasing figure will most likely be interpreted by investors as yet more proof that the American people are avoiding buying new homes, and that the mortgage banks are reluctant to offer mortgages as freely as they used to. Such a scenario will probably extend the greenback's bearish movement, and the EUR/USD might rise to test the 1.4800 level. If the Survey Will Surprise With Bullishness When the actual figure is higher than forecasted, traders are likely to see the USD appreciate against its currency pairs and crosses. The radical trading week we have just experienced, which included an extremely volatile trading session, concluded with significant weakness for the USD. Investors are now following the opportunity to make profits out of their open positions on the USD, and a better-than-expected figure on the New Home Sales survey, such as 540K will possibly provide them that exact opportunity. Such a figure is good because it will ease global market concerns regarding an expanding mortgage crisis. U.S. citizens feeling confident enough to purchase new homes is the best news that the American leadership can hope for, and the USD will rise in accordance. In this turn of events, the EUR/USD might correct itself down to reach as low as the 1.4400 level. Labels: forex, Forex Analysis, FX Instructor |
posted by Matbank at 12:38 AM
