Trading the News: USD Existing Home Sales

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Posted by on Thursday March 1, 2012 16:49:50:

Based on the report at, the news for the USD home sales is expected to be a bit lower than previously.
Initial value: 5.40M
Expected Value: 5.15M
Actual value: 4.88M

If the actual value is higher than expected value, USD will be bullish else it will be bearish and you should trade likewise.
Since the final value is much lower, it makes the USD weaker and more will be needed to exchange for the Euro or other paired currency.

The report helps to analyze the strength of the US housing market, which helps to analyse the economy as a whole and so if the report is weak, it signifies the USD as being weaker relative to other currencies like the Euro.

The final reports are out now and this made the USD bearish because it was lower than expected value and so the price of eur/usd rose from 1.4161 within about 15 minutes to 1.4194 since the USD was seen as weaker with lesser than predicted home sales.

When the USD is bearish, it means that it has become weaker and so more USD will be needed to buy for instance, one EUR in an exchange and hence EUR/USD will rise in value.

After the 3.00pm report EUR/USD rose from 1.4138 to 1.4194 - more than 50 pips! Just because the USD Home sales were lower than expected