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Selling the Bounce in EURUSD After Stronger US Q1 Final GDP

Skerdian Meta•Thursday, June 27, 2024•2 min read

EUR/USD has been consolidating within a range of 1.06 to 1.10 throughout 2024, with both buyers and sellers attempting to create momentum to break out of these levels. The weekly chart highlights moving averages that define this range and today we decided to open a sell forex signal here, after the small jump earlier today.

US Q1 final GDP ticked higher to 1.4%

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The US dollar remains bolstered by strong economic data from the US, such as the manufacturing and services PMI readings last week and this week’s US Consumer Confidence report. However, today’s data from the US was mixed. This positive data has kept interest rate forecasts steady, with expectations of around two cuts by the end of the year. In contrast, the euro has faced pressure this week as the US dollar has strengthened.

EUR/USD Chart H4 – The 50 SMA Stops the Climb AgainChart EURUSD, H4, 2024.06.27 15:14 UTC, MetaQuotes Ltd., MetaTrader 5, Demo

Today the Final GDP report from the US was slightly stronger than the previous reading, and prices ticked higher as well, so we decided to open a sell EUR/USD signal after the slight retrace higher during the European session.

The Final Reading on US Q1 GDP for 2024

US Q1 Final GDP: +1.4% vs +1.3% expected

  • Second reading: +1.3%
  • Final Q4 reading: +3.2% annualized
  • Q3: +5.2% annualized

Details:

  • Consumer spending: +1.5% vs +2.0% second reading
  • GDP final sales: +1.8% vs +1.7% second reading
  • GDP deflator: +3.1% vs +3.1% second reading
  • Core PCE: +3.7% vs +3.6% second reading
  • Corporate profits: -2.7% vs -1.7% in second reading
  • PCE services inflation excluding energy and housing: +5.1% vs +4.9% second reading

The data suggests higher inflation, indicated by the increased Core PCE and PCE services inflation. Lower consumer spending growth (from +2.0% to +1.5%) could signal downward pressure on prices. This data is considered outdated as we are nearing the second quarter, thus its relevance to current economic conditions is limited.

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ABOUT THE AUTHOR See More
Skerdian Meta
Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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