Dollar whacked despite decent data

The US dollar has fallen to the bottom of the currency pile today as the market shrugs off decent reports on initial jobless claims and durable goods orders. There were some caveats in the data but certainly nothing that screams to sell the dollar.

My guess is that the poor shipments data will lead to lower estimates of next week’s Q2 GDP report and traders want to get out of dollars. The consensus for the quarter has fallen to 1.1% from 1.4% two weeks ago. Just yesterday, Morgan Stanley cut its forecast to just 0.4% and Goldman released an estimate for 0.8%. Those estimates could be lowered imminently, raising the possibility that Q2 growth could be almost flat. Hard to imagine the Fed would taper in September with growth so close to nil.

The dollar decline today means USD has been the worst performer in three out of the four days this week.

Author: Adam Button

Adam Button is the editor of ForexLive™. He was previously the chief currency strategist at XForex and has also worked with Intermarket Strategy. Adam believes deeply in the value of knowing every tidbit of news. He has a background in journalism and was formerly the head of the markets team at the Canadian Economic Press. He is a graduate of Ryerson University and completed Level 1 of the CFA program. Adam lives in Montreal, follow him on Twitter: @FX_Button.

12 Comments

  1. pricing in d bad news but as long as dollar trade within the larger uptrend then its only a matter of time it resume higher

  2. Hi Adam, Aud/Usd rebounding seems like bid holding it hit 0.9199 and back what is your idea will it break 0.9200 any suggestion? Thanks

  3. You always seem to bring me bad dollar news. You must be a dollar bear!!

  4. I think it will break 0.9200. The series of higher highs and higher lows (albeit slightly) are a positive signal and the dollar just can`t catch a bid.

  5. Thank Appreciated Adam

  6. He isn’t a dollar bear Chief ;-) He’s just a first rate analyst and trader so he calls it like he sees it often with excellent incisive explanations for the reasons. Adam has posted many observations which explain why he was rightly bullish on the dollar at various times in the past. But I think you know that and are somewhat tongue in cheek?

  7. probably Chief is missing the old dodgy Chief …:-) we are here to think and to smile time by time, NOT to watch a kind of football game between dollar and antidollar , that was crap bullshit unreadable way to post comments!

  8. i hope u closed your longs way back chief…. 101.00 is a huge bargain in yer situation….
    rite now it’s hard to tell which way yen crosses will go……. bias is still up but i won’t be counting on tat…..as per my post way back, close at 99.00 and take a break from trading fer a few weeks, straighten up yer mind then come back a new man/woman with a tempered heart, soul and margin ;)

  9. Here we go on audusd above 0.9200 what next Adam?

  10. So far, so good eh Vicky! The market is pricing in a 70% chance of a rate cut but that’s a jittery sort of number. My guess is they get cold feet and retreat a bit, at least until we get more data. Just looking at the chart, we’ve broken the 38.2% retracement of the drop yesterday so look for 0.9220 and then take some money off the table.

  11. We make a good team Vicky!

  12. Yup Adam its great to talk you I,m done for today grabbed good profit on aud/USD,GBP/usd and EUR/jpy I hope you made some. Best of luck see you tomorrow. Good night

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