US New Home Sales m/m 11/25/09

10:00am (NY Time) US New Home Sales   Forecast 408K  Previous 402K
ACTION: USD/JPY or USD/CHF        BUY 480K    SELL 330K

Our focus is on the New Home Sales, which is expected at 408K; our tradable deviation is going to be 70K, so if the release is lower, it would be bad for USD and risk sentiment, so we will look to SELL USD/JPY or possible the USD/CHF pair; if the number is higher, it would be good for USD and risk sentiment, we could see a rally in USD and BUY USD/JPY or USD/CHF.

Definition:
“Measures the annualized number of new residential buildings that were sold during the previous month. A rising trend has a positive effect on the nation’s currency because the housing market is a leading gauge for the overall economy. A high level of housing activity signals that the construction industry is healthy and that consumers have the capital to make large investments. More importantly, new housing activity creates an economic ripple effect as home owners buy goods such as appliances and furniture for their homes, and builders buy raw materials and hire more workers to meet demand.”

News Impact Analysis & Risk Sentiment:
“US Housing data is considered recently as a global risk event because of the larger implication over the world economy, and of course the fact that the recent crisis originated from the subprime mortgages in the U.S., this news event holds particular meaning.  Therefore, we should treat this event more as a risk sentiment event for the time being rather than a U.S. event.  If we get better than expected release, expect to see risk appetite sentiment driving the market as investors seek for returns from the equity market; in the event of  a worse than expected release, demand for U.S. Treasuries should rise as traders seek the safe-haven protection of the USD and possibly turn to JPY for safety.”

Related posts:

1. US New Home Sales 01/27/10
2. US New Home Sales 02/24/2010
3. Trading Strategy For US New Home Sales 06/23/10
4. Forex Trading Plan For US New Home Sales 08/25/10
5. US New Home Sales 03/24/2010
6. US New Home Sales Forex Trading Plan 10/27/10
7. Forex News Trading US New Home Sales 02/24/11
8. Forex Trade Signal For US New Home Sales 09/24/10
9. Forex News Trading Plan For US New Home Sales 11/24/10
10. Forex News Trading US New Home Sales m/m 04/25/11

Tagged as: Amp, Construction Industry, Gauge, Global Risk, Housing Market, Impact Analysis, Implication, JPY, news event, Rally, Raw Materials, Residential Buildings, Ripple Effect, risk appetite, safe haven, sentiment, Signals, Subprime Mortgages, Treasuries, world economy