How will U.S. third quarter GDP data impact EUR/USD?

ForexNewsNow | Published on October 29, 2010 at 4:52 am

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EUR USD analysis  - a pile of dollarsNEW YORK (Forex News Now) – The Bureau of Economic Analysis is due on Friday to publish a key report on the United States’ gross domestic product in the third quarter on Friday, in one of the day’s major realtime forex news events.

The bureau is expected to say that U.S. GDP, the primary measure of the country’s overall economic output, grew an annualized 2 percent during the third quarter, according to two major online FX trading news outlets, up from growth of 1.7 percent in the second quarter.

The report is scheduled to be released at 12:30 P.M., GMT; as such, the data is likely to dominate European afternoon currency market trading.

According to EUR USD analysis, a smaller-than-expected increase in GDP could lift EUR/USD toward short-term resistance around the high of Oct. 15, 1.4158.

However, should the data show a greater-than-forecast increase, the currency pair could be pushed toward short-term support around support around the low of Oct. 20, 1.3698.

Of course, the latter scenario could actually whet FX traders’ risk appetites, which would likely benefit the euro against the dollar.

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