GDP Live Coverage
| US GDP Live Coverage with Nick Nasad | (04/29/2009) |
1:13 | FXstreet.com: Good morning, good afternoon and good evening to everyone all over the world. Today's U.S. GDP Live Coverage will start in 5 minutes. I am really happy to introduce Nick Nasad who is going to take part in this live event today as a co-presenter. He will be giving us a direct picture for the market status. |
1:13 | FXstreet.com: Nick Nasad is a currency market analyst with CMS Forex for the last 3 years. He closely monitors fundamental releases and reports their results and provides commentary to the company's clients through CMS Forex's interactive economic calendar Forex Capsule and through daily Forex market video recaps. He has also written extensive educational material on using technical analysis in trading Forex. |
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1:15 | Nick Nasad - CMS: Hello everyone, and thank you fxstreet for having me on again! |
1:16 | Nick Nasad - CMS: Coming into today's GDP release we have seen a bout of risk appetite in the currency markets with the greenback and Yen falling against thier rivals. |
1:17 | Nick Nasad - CMS: The Euro moved higher for a second straight session, as better than expected econmis sentiment data mixed with better stock performance helped the EUro strengthen. |
1:17 | Nick Nasad - CMS: we're up more than 100 pips in the EUR/USD pair, so we should see if the market is ready for any follow through from the GDP data. |
1:18 | Nick Nasad - CMS: The expectations for today's GDP release is an annualzied decline of 4.7%, which is smaller than what we saw in the 4th quarter (-6.3%). |
1:18 | FXstreet.com: Hi every one let me know your opinion on the GDP.. |
| 1:18 | Will the FOMC keep the benchmark rates? Yes, the FOMC will hold the ongoing rates ( 100% ) ( 0% ) ( 0% ) ( 0% ) |
| 1:19 | What do you anticipate the outcome of U.S. GDP? Good result and bullish for the USD ( 40% ) ( 20% ) ( 13% ) ( 13% ) ( 13% ) ( 0% ) |
1:20 | Nick Nasad - CMS: a GDP reading that is better than a -4.7% drop, say somewhere in the -4% or better range would be dollar positive, at least initially. while a reading that is in line with expectations should pressure the greenback. |
1:21 | Nick Nasad - CMS: currently the Pound is reversing some of its gains while the Loonie is breaking new ground, trying to reach the 1.20 level. |
1:21 | [Comment From Aram] will market waiting for fed or it move well after gdp? |
1:22 | Nick Nasad - CMS: ill start taking some questions now. I think the GDP data has a chance to move markets, especially if we get a surprise result. |
1:22 | [Comment From Phantom1] Hi Nick ... it is a greater chance that eur/usd .... will not react to the GDp. right ? |
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1:23 | Nick Nasad - CMS: the EUR/USD has already rallied from low to high about 150 pips.., yesterday we saw a 190 pip move, so projecting out there is a chance that we go higher to 1.33 (if GDP is worse than expected). |
1:23 | [Comment From Dusan] Hi Nick, What GDP result can push EUR/USD pair higher? What level pair can reach before FOMC? |
1:24 | Nick Nasad - CMS: i think anything weaker than -4.7%, the consensus, has a chance to pressure the Dollar. Participants believe that the 1st quarter was better than the 4th, but tehre were still many weak spots in the economy. If its believed that the US pace of decline is faster than anticipated than the greenback could see some further sell off. |
1:25 | [Comment From longhand] How do you see EUR/USD in one week. I guess dollar is going to start bullish today. Till next week euro rate announcement |
1:25 | FXstreet.com: 5 minutes to go |
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1:26 | FXstreet.com: CMS Forex, today’s Sponsor also produces expert analysis, market research and daily market news coverage with videos and reports. Browse the following URLs to learn and take profit from their expertise. |
1:26 | Nick Nasad - CMS: The Euro has been helped by a string of better than expected data like manufactuing and services PMI's, and ZEW economic sentiment and IFO business index, and the data confidence data from overnight. |
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1:27 | Nick Nasad - CMS: I think that the Euro was being sold off in most of April as a reuslt of weaker data and weaker expectations for growth, where now the opposite effect is taking hold. |
1:27 | [Comment From zaphy] Interesting you'd say that we can reach 1.33. Last three months, no matter what the outcome of the GDP was the $ strengthened (initially). Or do you mean longer term (24hrs+)? |
1:28 | Nick Nasad - CMS: zaphy, thats an interesting point, and part of the reason could have been that traders were playing on risk sentiment and not necessarily how the data reflected no the US economy |
1:29 | Nick Nasad - CMS: i think today, the link between risk sentiment, though still strong, is slightly weaker than it was several months ago, and we can see a more "normal" response. |
1:30 | FXstreet.com: U.S GDP -6.1 |
1:30 | Nick Nasad - CMS: im seeing a turn down in the USD/JPY prior ot the release, though its most likely noise., the pound is showing a similar dip in favor of the dollar. |
1:30 | Nick Nasad - CMS: we have a worse than epxected outcome |
1:31 | Nick Nasad - CMS: that should pressure the greenback, unless risk sentiment fears overpower the reponse |
1:31 | Nick Nasad - CMS: and we have a flight to safety in the dollar. |
1:31 | FXstreet.com: US GDP -6.1% vs Forecast -4.6% |
1:32 | Nick Nasad - CMS: that reading is lower than i thought it would be, the pound is giving up its gains, |
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1:33 | Nick Nasad - CMS: as is the Canadian dollar. it seems that the risk appetite that we saw overnight, may now initially give way to risk aversion.there hasn't been a huge reposnse to the data,.. but the indication is that this will not help boost the euro since the overnight gains came on risk appetite., |
1:34 | FXstreet.com: US GDP -6.1% vs Forecast -4.6% |
1:34 | [Comment From Aram] is it time to sell usd/jpy? |
1:36 | Nick Nasad - CMS: Aram, i think part of what we are seeing is asubdeud response seince we still have a key event coming up in the FOMC meeting., therefore the moves have been limited,. I dont see how this could be taken in stride by equity markets in the US, so i would say the dollar-yen has a chance to fall the rest of the session. |
1:36 | [Comment From jimmy] why is the USD rising if the GDP is lower than expected? |
1:37 | Nick Nasad - CMS: we are seeing risk sentiment playing a stronger role than the effect this report has on expectations for growth in the US economy. |
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1:38 | Nick Nasad - CMS: since we gained overnight on higher stocks and a sense of risk appetite, (purchasing higher-yielding pairs at the expense of dollar and yen) traders are now looking in the opposite direction. However, the moves are subdued for such a negative figure, and it seems that traders are looking forward and waiting for the Fed later today |
1:39 | [Comment From hardstone1] i have short gpb/yen at 141.46 what do u think about pond |
1:41 | Nick Nasad - CMS: the pound-yen has seen some interesting price action movement recently in that it broke above a downward sloping line of resistance near 141 (connect highs from April 16th, 24th, 25th). we saw a bounce off support near 139.40, and right now we seem to be running up against a very short term level of support. (connecting lows from today and yesterday) |
1:41 | Nick Nasad - CMS: so, the pair is at a critical level for the short term. |
1:42 | [Comment From Guest] Reaction seems real slow despite worse than expected number |
1:43 | Nick Nasad - CMS: hardstone, i dont know what your thoughts were going into the trade, but the Yen has seen 1000 pip move down since mid-April, and did seem ready for a retracement. therefore, you may be looking at a buillish basis for the short term, with a more downward basis overall.. its just that break of support recently give me pause about a sell.. |
1:43 | Nick Nasad - CMS: guest, i totally agree, i would not expect such a weak reaction. |
1:44 | Nick Nasad - CMS: one thing we may be seeing is that investment and a reduction in inventories were a major part of today's weaker than expected number |
1:44 | Nick Nasad - CMS: however a rundown in inventories sets the stage for more orders in the 3rd quarter and perhaps better growth ahead. |
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1:46 | [Comment From Art] How about Advance GDP Price Index q/q effect than Advance GDP q/q. I see Advance GDP Price Index q/q is higher than forecast? |
1:47 | Nick Nasad - CMS: that could be a factor.. if inflation is climbing faster than expected than the Fed's programs are being successful in fighting back deflation. |
1:47 | [Comment From zaphy] I guess there won't be a rate hike from the FOMC today! Do you see any chance of them announcing further QE measures? |
1:48 | Nick Nasad - CMS: the euro/usd is turning downward, |
1:48 | Nick Nasad - CMS: seems that the risk appetite we have seen is gone, and we may start a retracement of today's move. |
1:50 | Nick Nasad - CMS: I think the Fed will not go so far as to introduce new quantitative measures, but will give an assessment of how the program is working so far. in the last meeting the Fed allocated more money, and I do not believe they have used it up yet. plus, prior to today's GDP the Fed could point to better data to argue that the economy is seeing some "greenshoots" and that further QE may not be needed at this time |
1:52 | [Comment From rajan] hi do you think eur and yen are safe heaven at this moment |
1:52 | [Comment From sohail] i have buy of gbp/usd at 146.60, is it good time to cover or should hold? |
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1:53 | Nick Nasad - CMS: sohail, the 1.47 level right now is acting as a major fault line for bulls and bears., a break of it would surely send the pair lower than 1.4660, its hard to gauge currently, but my expectation is that US equities will not be able to shrug off the GDP news and we will see more risk aversion than risk appetite in the NY session. |
1:54 | FXstreet.com: We have just 10 minutes left. Please ask anything related to the market. |
1:54 | Nick Nasad - CMS: but so far, we are not seeing a major reaction |
1:54 | [Comment From Rudy] How about AUDUSD |
1:55 | Nick Nasad - CMS: though the Aussie has recovered nicely from its fall to start the week, it looks slightly overbought now and running up against some resistance. we may see a period of consolidation as we've seen higher lows, but also lower highs, and price action could get squeezed the rest of today and this week. |
1:56 | [Comment From rajan] so you suggest sell eur for next few hrs |
1:56 | Nick Nasad - CMS: i think the potential is setting up for a eur/usd sell, but i wouldnt jump on it yet., the lack of conviiction to the GDP news right now makes me wary. |
1:56 | [Comment From lin] Is it possible that once market opens in about 40 minutes that the reaction would be stronger and not so subdued? |
1:57 | Nick Nasad - CMS: i think thats a very good point, and right now the currency markets may take their cue from the equity markets, until the Fed concludes its meeting. |
1:57 | Nick Nasad - CMS: especially since overnight we saw a sharp move upward on good performance from European stocks |
1:58 | [Comment From Dusan] What should be signal to sell EUR/USD? |
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2:00 | Nick Nasad - CMS: different traders have their own signals, but what we are seeing is that we have come close to resistance from Friday near 1.33, and after a 300 pip rally, the conditions that gave rise to the rally are shifting. however, last week's rally was about 400 pips, so there still room for it to move upward. i actually wouldnt sell the pair right now, its too tough to gauge what will happen next. we dont seem overextended, so unless the pair moves up to 1.33 and shows a reversal, i would actually wait. |
2:01 | [Comment From Bermuda] What trend expect if the rate US remain 0.25? |
2:02 | Nick Nasad - CMS: the US rate will be kept the same, what you should look for is language in regards to QE,. if the Fed will announce more money for QE, the dollar may be pressured, but if they say the current programs are adequate then teh greenback shouldn't be pressured, though i dont know that it will rise from that news either. |
2:03 | [Comment From Rudy] What level to long AUDUSD |
2:03 | Nick Nasad - CMS: if we have a move downward in a period of consolidation, the area around 0.75 may be a good long. |
2:04 | Nick Nasad - CMS: if the pair heads upward, its hard to get from the current price action as we have stiff resistance at the 0.73 level. |
2:04 | Nick Nasad - CMS: sorry i meant 0.7050 earlier for a long |
2:06 | FXstreet.com: Sorry ,,, it is time to warp up the live coverage. |
2:06 | FXstreet.com: US GDP was wrose than expected-6.1% (vs Forecast -4.6% ) |
2:07 | Nick Nasad - CMS: so in an interesting development, the currency markets have shrugged off the GDP data, and though it stalled the advance of the Euro and Loonie against the greenback, we havent seen a big move towards risk aversion, or greenback weakness. Market participants are therefore waiting for how US equities will respond to the GDP news, and of course the FED announcement which doesnt come for another 5 hours or so... |
2:08 | FXstreet.com: Thank you eveone for joining the coverage today! Thank you!... and Nick! We really appreciate your comments on the market,,, tahnk you very much,! |
2:09 | Nick Nasad - CMS: so, thats all the time i have for this live coverage, but I will be back later in the day during the FOMC announcement, so we'll see if we have any important developments. |
2:09 | FXstreet.com: Thank you Nick! See you later then ! |
2:11 | [Comment From lin] thanks nick |
2:12 | FXstreet.com: Okay everyone,,, as Nick told us. we have teh FOMC live coverage later on at 18:15 GMT |
2:12 | FXstreet.com: So please stay with us and see you later in the live coverage. |
2:13 | FXstreet.com: Bye for now! Have a nice time! See you all!!!! |
2:13 | FXstreet.com: I would like to specially thank CMS Forex, today’s sponsor, for their support. Open a live account with CMS with a low minimum initial deposit of $200 now. Use the following links to follow up about today’s main market news. |
2:13 | FXstreet.com: CMS General Research page |
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2:14 | [Comment From Bermuda] thnx |
2:14 | [Comment From arasan] We really appreciate u r comments thanks nick |
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