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EUR/USD Drops to New Lows

August 26, 2014 by

EUR/USD attempted to rally today but failed and fell to the lowest level since in almost a year. The dollar continues to show strength thanks to last week’s hawkish comments for US policy makers as well as positive macroeconomic data.

Durable goods orders surged 22.6% in July. It was a very impressive result compared to the predicted increase of 7.8% and the revised June figure of 1.7%. (Event A on the chart.)

S&P/Case-Shiller home price index rose 8.1% in June on an annual basis. The reading was in line with expectations but below the previous month’s figure of 9.4%. Month-on-month, the index grew 0.96%. (Event B on the chart.)

Richmond Fed manufacturing index climbed to 12 in August, the highest reading since March 2011, while experts predicted it to stay little changed from the July’s value of 7. (Event C on the chart.)

Consumer confidence climbed to 92.4 in August from the revised July’s value of 90.3. It was a pleasant surprise for traders who want to be bullish on the dollar as analysts predicted a drop to 89.1. (Event C on the chart.)

Yesterday, a report on new home sales was released, showing that sales were at the seasonally adjusted annual rate of 412k in July, trailing market expectations of 426k. On a bright note, the June’s figure was revised from 406k to 422k. (Not shown on the chart.)

EUR/USD for 2014-08-26

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