3.1% GDP Growth in Q3 Makes Greenback Stronger

US DollarIn our report published on January 8, 2018, we had forecasted the US Dollar to rally against the Yen due to inflation data and strong retail sales.

Additionally, we also recommended our traders to purchase a LONG position in USD/JPY currency pair around 111.70 levels with a target of 113.70.

Further, we also expressed our interests for the binary options traders to invest in a call option with a validity period of 7 days. As speculated, the currency pair within a week’s time had hit the target. Both the traders benefitted from our speculation. Last week, the currency pair closed at 113.70 and was likely to increase in future. The reasons for the same are discussed below.

The US Census Bureau in its 3rd quarter GDP estimate report has said that US economy is increasing at a breakneck pace with a growth of 3% annually against the speculated growth of 2.6% by the analysts. In the last quarter, the US GDP grew by 3.1 percent. This is the best performance in back in the back quarter for the past three years. It is noteworthy to say that consumer spending which constitutes 70% of US economy grew 2.4 percent after increasing 3.3% in Q2.

WION

In spite of the hurricanes Irma and Harvey as well as growth in wages by 2.9% in September 2017 from earlier 2.7% in August, there are chances of a rate hike in December to more than 90 percent. The rate hike seems more real after the approval of the US Senate of the budget blueprint. All these things strongly support a rally in the US Dollar.

On the other end, PM Shinzo Abe and his Liberal Democratic Party won comprehensively in the snap elections held recently. The party secured 312 out of the 465 seats total contested. The election win with more than 70 percent majority votes will allow the Prime Minister to continue implementing his existing policies of a close bond with the United States, disapproval of North Korea and loose fiscal policy. It also means that the Central Bank of Japan will take all the necessary measures to make the Yen weak.

USDJPY Pair October 30th 2017

USDJPY Pair October 30th, 2017

Likewise, the stock exchange of Japan, Nikkei, continues to rise high. Yen currency has a unique inverse relation with the economy and stock market of Japan. In the coming weeks, we can speculate the USD/JPY to rally further. Based on the chart image given above, the currency pair is consolidating at 113.50 levels and might form AB=CD pattern which in turn can lead the pair to 115.70 levels. Hence, it would be wise for the traders to open a “LONG” position.

Traders are recommended to open a LONG position in the currency pair. Traders should enter the trade near 113.50 and place stop order at 112.40. They can exit from the deal near 115.70.

In addition to the above, we also advise the traders to buy a “CALL” option from a reputed binary options broker when the currency pair is trading near 113.50 and select expiry period around November 7, 2017.

Rich Archer

Rich Archer

Hi, my name is Rich Archer. I am living in London. Welcome to Binary Manual. Reach to Binary Options broker reviews and market news here.


Related Articles

GE Stocks at 12 Month Low and Misses Q3 EPS Estimate

General Electric Company (NYSE: GE) stocks have dipped to the 12-months low figure of $22.10 after reporting a year on

Eurosceptic Candidates Take Lead in French Polling

The Canadian Dollar begins to dip low last week after crude oil has nudged down to $50 per barrel. The

BofA Expects 9% Rise in Net Income after Beating Q3 Estimates

The Bank of America’s stocks (NYSE: BAC) were able to recover to $25 levels after experiencing 12 months low figure

No comments

Write a comment
No Comments Yet! You can be first to comment this post!

Write a Comment

Your e-mail address will not be published.
Required fields are marked*