US CB Consumer Confidence is based on a monthly survey of about 5,000 U.S. households regarding their opinion of the economy. Traders should pay close attention to its release, which always has a strong impact on market prices. A higher reading than the market forecast is bullish for the dollar.
Indicator Background
CB Consumer Confidence is an important gauge of consumer confidence. Increased consumer confidence usually translates into an increase in consumer spending, a key engine of economic growth.
The indicator weakened in November, slipping to 88.7 points. This was well below the estimate of 95.9 points. The markets are expecting a strong turnaround in the December reading, with the estimate standing at 94.6 points.
Sentiments and levels
So, the overall sentiment is bearish on EUR/USD towards this release.
Technical levels, from top to bottom: 1.1373, 1.13, 1.1215, 1.1113, 1.1050 and 1.0950.
5 Scenarios
Within expectations: 91.0 to 98.0: In such a case, EUR/USD is likely to remain within range, with a small chance of breaking higher.
Above expectations: 98.1 to 102.0: An unexpected higher reading can send the pair below one support level.
Well above expectations: Above 102.0: A sharp increase in consumer confidence could boost the dollar and send the pair below a second support level.
Below expectations: 87.0 to 90.9: A reading lower than forecast could push EUR/USD above one resistance level.
Well below expectations: Below 86.9: In this outcome, the pair could break above a second resistance level.
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities.
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