U.S. Dollar Trading (USD) received a major boost through a sizable cable sell off during the Asian session dragging down all the majors against the greenback. Sentiment slowly reversed during the remainder of the day picking up speed as US equities tumbled on reports another US bank failed and speculation of large write downs in Q3. July Existing Home Sales supported rising 3.1% to 5 Million from 4.85 Million in June. In the U.S. share markets, the NASDAQ was down 49 points (-2.03%) and the Dow Jones was down 241 points (-2.08%). Crude Oil closed up $0.50 ending the New York session at $115.10 per barrel. Looking ahead, the Case Shiller Home price index is forecast to drop -0.8% in June. Conference Board Consumer Confidence is expected to increase to 53 from 51.9 in August. July New Home Sales are expected to remain 530K.
The Euro (EUR) came under pressure falling in sympathy with the large falls in Cable before reversing as US equities turned south. Oil was unable to maintain gains and its pullback weighed on the single currency into the US close. Overall the EUR/USD traded with a low of 1.4696 and a high of 1.4809 before closing the day at 1.4755 in the New York session. Looking ahead, German GDP Q2 expected at -0.5% along with Consumer Confidence expected at 2 down slightly from 2.1. Also released, IFO Index forecast down slightly to 97.1.
The Sterling (GBP) lead the fall in the Asian session as stops below 1.8500 were cleared inducing an 80 pip fall to multi-year lows. Support was found in the European session although trading was light as UK was away on a bank Holiday. USD weakness during the US session turned the rebound into a rally but gains were pared to end the day roughly where we began. Overall the GDP/USD traded with a low of 1.8405 and a high of 1.8590 before closing the day at 1.8530 in the New York session.
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