US New Home Sales indicator is released monthly, and provides analysts with important data the health and direction of the housing sector. A higher reading than the market prediction is bullish for the dollar.
Here are all the details, and 5 possible outcomes for USD/JPY.
Published on Wednesday at 14:00 GMT.
US New Home Sales provides analysts and investors with a snapshot of the strength of the US housing market, one of the most important sectors of the economy. As a house is likely to be the largest purchase that a consumer will make, this indicator also can provide insight into current levels of consumer spending, a key driver of economic activity.
In April, the indicator jumped to 619 thousand, crushing the estimate of 521 thousand. The markets are expecting a softer landing in May, with an estimate of 561 thousand. Will the indicator repeat and beat the estimate?
Sentiments and levels
With the BoJ continuing to show no appetite for further easing, the yen could continue to rise and move closer to the symbolic 100 level. The Fed also remained on the sidelines last week and Yellen’s congressional testimony appears to have taken a July rate hike off the table. So, the overall sentiment is neutral on USD/JPY towards this release.
Technical levels, from top to bottom: 107.39, 106.25, 105.19, 104.25, 102.80 and 101.51
- Within expectations: 557K to 565K: In such a case, USD/JPY is likely to rise within range, with a small chance of breaking higher.
- Above expectations: 566K to 571K: An unexpected higher reading can send USD/JPY above one resistance level.
- Well above expectations: Above 571K: A sharp increase could propel the pair above a second resistance line.
- Below expectations: 551K to 556K: A reading lower than forecast could send USD/JPY below one support level.
- Well below expectations: Below 551K. In this outcome, the pair could break below a second support level.