79% of retail accounts lose money when trading CFDs with this provider. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Regulator asic CySEC fca

U.S. dollar has consistently appreciated after positive economic data

April 23, 2019 16:00

Last week, financial markets experienced a pre-holiday calm and as a result, volatility was quite low. However, economic data had different plans – the U.S. and China have exceeded market participant expectations, while Europe continued to disappoint and shows no signs of recovery. Once again, when a difference occurs between positive economic developments in the U.S. and significantly worse indicators in other developed countries emerges, the U.S. dollar appreciates.

US Dollar appreciates

In the political arena, most of the attention was drawn to U.S. and China negotiations regarding ongoing international trade deliberations. Both sides have stated that they are committed to arriving at an agreement, and planning a new stage of meetings. At the end of April, the U.S. delegation will visit Beijing, and in the first week of May, Chinese negotiators will go to Washington. It is expected that a final agreement will be announced after this meeting, and the two nations' presidents will have it in writing by the end of May.

U.S. Dollar

In regards to positive economic data from the U.S., focus was primarily on the retail sales data, which showed 3.6% yearly growth, exceeding market expectations. After several less-than-positive months, investors expected to see a very good result - particularly given that citizens received their tax refunds, which often results in an influx of cash into the goods market. The preliminary Manufacturing Purchasing Managers Index remained stable at 52.4 points, which indicated fairly consistent expectations for the upcoming several months. Meanwhile, industrial growth has slowed from 3.6% to 2.8% per year. The unemployment claims count last week decreased further, reaching 192 thousand. This is the lowest result since 1969, which shows that the U.S. labour market remains strong, and fewer people are seeking help from the state when they lose their jobs.


Principal currency pair, the EUR/USD has depreciated. The most significant decline was recorded on Thursday, when Europe's economic data did not show evidence of the expected recovery in economic activity. The preliminary manufacturing sector's Purchasing Managers Index marginally increased from 47.5 to 47.8 points, although remained in negative territory and signalled a possible economic contraction. In Germany, this indicator was at 44.5 points and has remained at a long-term low point. That indicates, that the automotive industry is experiencing a difficult period. Nevertheless, it is important to consider that China has announced incentives for car sales, which will likely let German automakers relax a bit over the next few months. Among other news, Europe's economic expectations index ZEW increased from -2.5 to 4.5 points, which is a positive sign. European inflation indicators remained stable, and yearly price growth was 1.4%. The EUR/USD ended the last trading week by dropping -0.5%.


The most important Asian currency pair the USD/JPY has consolidated at 112.0-point level, which is its highest point since last December. Economic data continues to disappoint market participants. Manufacturing sector's preliminary Purchasing Managers Index came in at 49.5 points, remaining below the neutral 50-point limit. Manufacturing production in February has declined -1.1% per year, and exports have decreased by -2.4%. The USD/JPY has ended the trading week by depreciating -0.1%.


In the British pound market, negative sentiment prevailed and the GBP/USD depreciated to a 200-day moving average. There were no significant Brexit developments, and economic data, despite being relatively positive, did not encourage any recovery of the pound. Retail trade growth surprised and significantly exceeded expectations, increasing 6.7% per year, indicating that consumer sentiment has not been affected by Brexit uncertainty. Inflation has remained stable at 1.9% per year, and in the labour market, wage growth remained strong at 3.5% per year. The GBP/USD has ended the trading week dropping -0.6%.


This week will begin calmly, as Monday is a holiday in most of the major economies due to Easter. On Tuesday and Wednesday, there are no significant economic events planned. On Thursday morning, investors will closely watch the Bank of Japan's press conference, looking for any hints of possible monetary policy changes, and at the end of the trading session, will focus on US long-term industry orders. On Friday morning, Japanese industrial indicators will be released, followed by preliminary U.S. first-quarter economic growth results.

According to Admiral Markets market sentiment data, 66% of investors hold long positions in the EUR/USD (increasing +34 percentage points compared to last week's data). In the USD/JPY, 14% of investors have long positions (+4 percentage points). In the GBP/USD, 77% of participants expect growth (+19 percentage points). This kind of market data is interpreted as a controversial indicator, therefore appreciation is likely in the USD/JPY, while depreciation is likely in the EUR/USD and GBP/USD pairs. Analysis of positioning data should always be accompanied by fundamental projections and technical analysis.

Sources: bloomberg.com, reuters.com, Admiral Markets MT4 Supreme Edition, investing.com

Investing in Forex with Admiral Markets

Admiral Markets offers professional traders the ability to trade with a custom, upgraded version of MetaTrader 5, allowing you to experience trading at a significantly higher, more rewarding level. Experience benefits such as the addition of the Market Heat Map, so you can compare various currency pairs to see which ones might be lucrative investments, access real-time trading data, and so much more. Click the banner below to start your FREE download of MT5 Supreme Edition!

Download MetaTrader 5 and begin trading today!

Disclaimer: The given data provides additional information regarding all analysis, estimates, prognosis, forecasts or other similar assessments or information (hereinafter "Analysis") published on the website of Admiral Markets. Before making any investment decisions please pay close attention to the following:

  1. This is a marketing communication. The analysis is published for informative purposes only and are in no way to be construed as investment advice or recommendation. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and that it is not subject to any prohibition on dealing ahead of the dissemination of investment research.
  2. Any investment decision is made by each client alone whereas Admiral Markets shall not be responsible for any loss or damage arising from any such decision, whether or not based on the Analysis.
  3. Each of the Analysis is prepared by an independent analyst (Jens Klatt, Professional Trader and Analyst, hereinafter "Author") based on the Author's personal estimations.
  4. To ensure that the interests of the clients would be protected and objectivity of the Analysis would not be damaged Admiral Markets has established relevant internal procedures for prevention and management of conflicts of interest.
  5. Whilst every reasonable effort is taken to ensure that all sources of the Analysis are reliable and that all information is presented, as much as possible, in an understandable, timely, precise and complete manner, Admiral Markets does not guarantee the accuracy or completeness of any information contained within the Analysis. The presented figures refer that refer to any past performance is not a reliable indicator of future results.
  6. The contents of the Analysis should not be construed as an express or implied promise, guarantee or implication by Admiral Markets that the client shall profit from the strategies therein or that losses in connection therewith may or shall be limited.
  7. Any kind of previous or modeled performance of financial instruments indicated within the Publication should not be construed as an express or implied promise, guarantee or implication by Admiral Markets for any future performance. The value of the financial instrument may both increase and decrease and the preservation of the asset value is not guaranteed.
  8. The projections included in the Analysis may be subject to additional fees, taxes or other charges, depending on the subject of the Publication. The price list applicable to the services provided by Admiral Markets is publicly available from the website of Admiral Markets.
  9. Leveraged products (including contracts for difference) are speculative in nature and may result in losses or profit. Before you start trading, you should make sure that you understand all the risks.

Admiral Markets Group consists of the following firms:
Admiral Markets Pty Ltd
Regulated by the Australian Securities and Investments Commission (ASIC)
Admiral Markets Cyprus Ltd
Regulated by the Cyprus Securities and Exchange Commission (CySEC)
Admiral Markets UK Ltd
Regulated by the Financial Conduct Authority (FCA)
Note: If you close this window without choosing a firm, you agree to proceed under the FCA (UK) regulation.
Note: If you close this window without choosing a firm, you agree to proceed under the FCA (UK) regulation.