GDP Hits Mark, Stocks Open Flat - Forex News by FX Leaders

GDP Hits Mark, Stocks Open Flat

Posted Thursday, June 27, 2019 by
Shain Vernier • 1 min read

Stocks have opened largely flat following release of the U.S. Q1 Annualized GDP figure. GDP hit its mark at 3.1%, reassuring skeptics that the U.S. economy has continued to grow at a formidable rate. The result has been a muted Wall Street open with the DJIA DOW (+24), S&P 500 SPX (+13), and NASDAQ (+52) trading sideways through the first 30 minutes of action.

Much is being made in the financial media about this weekend’s G20 Summit and the potential for a Trump/Xi trade war breakthrough. Whether or not that occurs is anyone’s guess; however, this morning’s GDP figures came in right on schedule:

Event                                                                       Actual    Projected     Previous

Core Personal Consumption (QoQ, Q1)              1.2%           1.0%               1.0%

GDP Annualized (QoQ, Q1)                                   3.1%           3.1%                3.1%

GDP Domestic Price Index (Q1)                           0.6%            0.8%               0.5%

If nothing else, today’s group of stats should go a long way to reassuring investors in the viability of the U.S. economy. Consumption is up modestly and GDP remains solid. All in all, this was a positive release in that it did not spur more talk of recession.

Solid GDP Report Spurs S&P 500 Futures

Following back-to-back losing sessions, price action is on the bull for September E-mini S&P 500 futures. Bids are hitting the market, driving prices toward the daily Double Top area.

September E-mini S&P 500 Futures (ES), Daily Chart GDP
September E-mini S&P 500 Futures (ES), Daily Chart

Bottom Line: As we roll toward the weekly close, the S&P 500 appears poised for a rally. With GDP being a non-factor, a test of the daily Double Top pattern (2967.75-2969.25) may be in the offing.

Until elected, I will have sell orders queued up in the September E-mini S&Ps from 2965.25. With an initial stop at 2970.75, this trade produces 22 ticks profit on a 1:1 risk vs reward management plan.

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About the author

Shain Vernier // US Analyst
Shain Vernier has spent over 7 years in the market as a professional futures, options and forex trader. He holds a B.Sc. in Business Finance from the University of Montana. Shain's career includes stretches with several proprietary trading firms in addition to actively managing his own accounts. Before joining FX Leaders, he worked as a market analyst and financial writer.
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