Global macro overview for 31/10/2016:
The official GDP data revealed on Friday by the US Department of Commerce had surprised market participants. According to the data, the US economy has expanded at its fastest pace since 2014 in the Q3 of 2016. It grew 2.9% in the third quarter, which was way better than previous quarter 1.4% growth. Moreover, the numbers have been better than a global market consensus of 2.5%. When we look into the details of the report, we can see that the exports jumped 10% in the third quarter, contributing 0.83% to GDP growth, which was led by soybeans. Inventory accumulation by businesses increased $12.6 billion in the third quarter, contributing 0.61% to GDP growth. The only down figure was business spending on equipment, that declined 2.7%, falling for the fourth consecutive month. In conclusion, the overall data has beat the market expectations, but this data are unlikely to change the FED’s view on the possibility of the rate hike, mostly because of the strong US job market and pressures to rise the inflation.
Let’s now take a look at the EUR/USD technical picture at the 4H time frame at the beginning of the new week. The bulls have pushed the prices higher towards the supply zone market as the gray rectangle, but wasn’t strong enough to break out above the main technical resistance at the level of 1.1040. Currently, the market trades around the intraday support at the level of 1.0946 and the bears are in full control of this market as the larger time frame trend remains bearish.
The material has been provided by InstaForex Company – www.instaforex.com