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Foreign Exchange Trading (FOREX): Analysis & Management Economic Indicators

Foreign Exchange Trading (FOREX): Analysis & Management Economic Indicators. Prepared and presented by Dr. Ahmad Khasawneh. FOREX Fundamental Analysis The Economics Indicators. Analyzing the data:

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Foreign Exchange Trading (FOREX): Analysis & Management Economic Indicators

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  1. Foreign Exchange Trading (FOREX):Analysis & ManagementEconomic Indicators Prepared and presented by Dr. Ahmad Khasawneh

  2. FOREX Fundamental Analysis The Economics Indicators • Analyzing the data: • Evaluating data changes (over time, compared to the market participant forecast, relative to the business cycle, compared to previous periods average, normal range). • Assessing whether the data change is significant or not.

  3. FOREX Fundamental Analysis The Economics Indicators • U.S. Economics Statistics: • Unemployment: is the percentage of the unemployed people to the total labor force in the economy.

  4. FOREX Fundamental Analysis The Economics Indicators - Employment Decrease U.S. Dollar - Unemployment increase will depreciate - Employment Increase U.S. Dollar - Unemployment Decrease will appreciate

  5. FOREX Fundamental Analysis The Economics Indicators • Employment tends to grow the fastest during the recovery phase of the cycle – 260k per month. • Employment tends to grow 100k faster during the rapid growth phase than the slower phase. • The significant unemployment rate change is about 0.2pp.

  6. FOREX Fundamental Analysis The Economics Indicators • Gross Domestic Product (GDP):

  7. FOREX Fundamental Analysis The Economics Indicators - GDP Decrease U.S. Dollar will depreciate - GDP Increase U.S. Dollar will appreciate • 0.1pp on a quarter to quarter basis is the minimum significant Variation.

  8. FOREX Fundamental Analysis The Economics Indicators • Consumer Price Index (CPI):

  9. FOREX Fundamental Analysis The Economics Indicators - CPI Decrease U.S. Dollar will depreciate - CPI Increase U.S. Dollar will appreciate • The normal range of the CPI change lies between 0.1% - 0.5%.

  10. FOREX Fundamental Analysis The Economics Indicators • Producer Price Index (PPI):

  11. FOREX Fundamental Analysis The Economics Indicators - PPI Decrease U.S. Dollar will depreciate - PPI Increase U.S. Dollar will appreciate • The normal range of the CPI change lies between 0.0% - 0.5%.

  12. FOREX Fundamental Analysis The Economics Indicators • Employment Cost Index (ECI):

  13. FOREX Fundamental Analysis The Economics Indicators - ECI Decrease U.S. Dollar will appreciate - ECI Increase U.S. Dollar will depreciate • The average quarterly increase in the ECI was 1.2% and 1.4% in the recession and recovery, and 1.1% in the expansion.

  14. FOREX Fundamental Analysis The Economics Indicators • Average Hourly Earnings:

  15. FOREX Fundamental Analysis The Economics Indicators - Hourly Earning Decrease U.S. Dollar will depreciate - Hourly Earning Increase U.S. Dollar will appreciate

  16. FOREX Fundamental Analysis The Economics Indicators • National Association Purchasing Manager (NAPM):

  17. FOREX Fundamental Analysis The Economics Indicators - NAPM Decrease U.S. Dollar will depreciate - NAPM Increase U.S. Dollar will appreciate • The diffusion index can range between 0 and 100 percent. With 50% implying no net change; above 50% suggesting improvement; and below 50% represent a contraction.

  18. FOREX Fundamental Analysis The Economics Indicators • Retail Sales:

  19. FOREX Fundamental Analysis The Economics Indicators - Retail Sales Decrease U.S. Dollar will depreciate - Retail Sales Increase U.S. Dollar will appreciate • The normal range of retail sales 0.0% - 1.2%. • The normal range of retail sales ex-auto 0.1% - 1.0%.

  20. FOREX Fundamental Analysis The Economics Indicators • Home Sales:

  21. FOREX Fundamental Analysis The Economics Indicators - Home Sales Decrease U.S. Dollar will depreciate - Home Sales Increase U.S. Dollar will appreciate

  22. FOREX Fundamental Analysis The Economics Indicators • Car and Truck Sales:

  23. FOREX Fundamental Analysis The Economics Indicators - Car & Truck Sales Decrease U.S. Dollar will depreciate - Car & Truck Sales Increase U.S. Dollar will appreciate

  24. FOREX Fundamental Analysis The Economics Indicators • Consumer Confidence Measures:

  25. FOREX Fundamental Analysis The Economics Indicators - Consumer Confidence Decrease U.S. Dollar will depreciate - Consumer Confidence Increase U.S. Dollar will appreciate

  26. FOREX Fundamental Analysis The Economics Indicators • Personal Income and Consumption:

  27. FOREX Fundamental Analysis The Economics Indicators - Income & Consumption Decrease U.S. Dollar will depreciate - Income & Consumption Increase U.S. Dollar will appreciate

  28. FOREX Fundamental Analysis The Economics Indicators • Durable Goods Orders and Shipments:

  29. FOREX Fundamental Analysis The Economics Indicators - Orders & Shipments Decrease U.S. Dollar will depreciate - Orders & Shipments Increase U.S. Dollar will appreciate

  30. FOREX Fundamental Analysis The Economics Indicators • International Trade of Goods and Services:

  31. FOREX Fundamental Analysis The Economics Indicators - Trade Balance Deficit Increase U.S. Dollar will depreciate - Trade Balance Surplus Increase U.S. Dollar will appreciate

  32. FOREX Fundamental Analysis The Economics Indicators • Unemployment Insurance Claim:

  33. FOREX Fundamental Analysis The Economics Indicators - Jobless Claims Decrease U.S. Dollar will appreciate - Jobless Claims Increase U.S. Dollar will depreciate

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