US durable goods orders overview
Monday's US economic docket highlights the release of durable goods orders data for July. The US Census Bureau is scheduled to release the monthly report at 12:30 GMT and consensus estimates point to another month of solid rise by 1.1% during the reported month, still lower than the previous month's 1.9% strong growth.
Excluding transportation items - core durable goods orders, which tend to have a broader impact than the volatile headline figures are anticipated to post a modest rise of 0.1% as compared to 1.0% in the previous month. Meanwhile, non-defense capital goods orders excluding aircraft and parts, a proxy for business investment are forecasted to decrease by 0.1% after June's upbeat reading of 1.5%.
According to the Danske Analysts – “The US preliminary capex orders for July will be interesting in the light of the ongoing manufacturing slowdown and trade war uncertainty. It seems that many companies are reluctant to invest in the current environment.”
Deviation impact on EUR/USD
Readers can find FX Street's proprietary deviation impact map of the event below. As observed, the reaction is likely to be in the range of 20-25 pips during the first 15-minutes in case of a deviation from +0.36 to -0.51 and could extend up to 51-55 pips in the following 4-hours.
EUR/USD important levels to watch
Yohay Elam, FXStreet's own Analyst offers some important technical levels ahead of the important release – “Support awaits at 1.1115, which capped EUR/USD twice last week. It is followed by 1.1090 that worked as a support line in mid-August. Further down, Friday's low of 1.1050 is the next level to watch before the 2019 low of 1.1027.”
“Some resistance awaits at 1.1130, which was a support line two weeks ago. It is followed by 1.1165, that is today's high. Next, we find 1.1190 and 1.1230, which both capped EUR/USD in the first half of August,” he added further.
Key Notes
• US Durable Goods Orders Preview: Business and consumer spending diverge
• EUR/USD levels to watch after jumping on trade wars – Confluence Detector
• EUR/USD keeps the bearish bias unchanged – Commerzbank
About US durable goods orders
The Durable Goods Orders, released by the US Census Bureau, measures the cost of orders received by manufacturers for durable goods, which means goods planned to last for three years or more, such as motor vehicles and appliances. As those durable products often involve large investments they are sensitive to the US economic situation. The final figure shows the state of US production activity. Generally speaking, a high reading is bullish for the USD.
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