Search ForexCrunch

US  Final GDP is a key release and is published each quarter.  GDP reports measure production and growth of the economy, and  are considered by analysts as one the most important indicators of economic activity. A reading which is  higher than the market forecast is bullish for the dollar.

Here are all the details, and 5 possible outcomes for EUR/USD.

Published on Friday at 12:30 GMT.

Indicator Background

Final  GDP is the final of three GDP versions. Traders should pay close attention to the GDP release, as an unexpected reading could quickly affect the direction of EUR/USD.

US  Preliminary GDP  posted a  gain of  1.0% in Q4, well above the estimate of 0.4%.  Final GDP for Q4 also stands at 1.0%.

Sentiments and levels

The ECB remains dovish, but recent statements by Fed policymakers have been hawkish, calling for a rate hike as early as April. So, the overall sentiment is  bearish on EUR/USD towards this release.

Technical levels, from top to bottom: 1.1373, 1.13, 1.1220, 1.1140, 1.1070  and 1.10.

5 Scenarios

  1. Within expectations:  0.7% to 1.3%: In such a scenario, EUR/USD is likely to rise within range, with a small chance of breaking higher.
  2. Above expectations: 1.4% to 1.7%: An unexpected higher reading can push the pair  below one  support line.
  3. Well above  expectations: Above 1.7%: A strong reading  would likely boost the dollar, and the pair could break  below a second support line  as a result.
  4. Below expectations: 0.2% to 0.6%: In this scenario, EUR/USD could  push above one  resistance level.
  5. Well below  expectations: Below 0.2%. A  poor reading  could  result in  the pair breaking above a second resistance line.

For more on the euro, see the  EUR/USD forecast.