How to trade the US ISM Non-Manufacturing PMI with EUR/USD
- The forward-looking gauge for the services sector is a top-tier figure that moves markets.
- The Market Impact Tool shows trading opportunities in both upside and downside surprises on this event.
- The EURUSD moved, on average, 14 pips in the 15 minutes after the data release and 35 pips in the following 4 hours
Buying EUR/USD Scenario
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Tradable Negative Trigger: -0.69 deviation (57.13 ) [BUY Pair]
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Key Resistance Level: 1.1695
If it comes out lower than expected at a relative deviation of -0.713 or less(56.1892 or lower in actual terms), the EURUSD may go up reaching a range of 29 pips in the first 15 minutes and 103 pips in the following 4 hours.
1.1630 held the pair down in early September. The line also had a role beforehand. 1.1695 was a peak in late August. 1.1735 was a swing high in mid-August and it is followed by the quadruple top of 1.1750 from July.
Selling EUR/USD Scenario
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Tradable Positive Trigger: +0.90 deviation (57.57 ) [SELL Pair]
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Key Support Level: 1.1530
This time, if it comes out at higher than expected with a relative deviation of 0.90 or higher(57.57 or higher in actual terms), the pair may go down reaching a range of 22 pips in the first 15 minutes and 68 pips in the following 4 hours.
1.1585 was a pivotal line in the range. 1.1530 is a double-bottom from late August and early September and is the most significant support level. 1.1495 was a swing low in mid-August.
EUR/USD Levels on the Chart
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More data
The broad ISM Non-Manufacturing PMI survey asks influential managers' to rank the state of their business looking forward. The services sector is America's largest. A better sentiment implies more hiring. A small rise is expected after the disappointment last month.
More: ADP NFP + ISM Non-Manufacturing Preview: Data are indicative not only for the NFP
In the last five releases, the EURUSD moved, on average, 14 pips in the 15 minutes after the data release and 35 pips in the following 4 hours. The previous release had a negative surprise of -3.38 in terms of relative deviation and the EURUSD reached a 13 pip range in the first 15 minutes and a range of 51 pips 4 hours thereafter.
Follow the publication of the figure on the economic calendar. Watch out for the data from the Market Impact tool, projecting the potential price changes according to the deviation. Here is the Market Impact Studies Users Guide.
Author
Yohay Elam
FXStreet
Yohay is in Forex since 2008 when he founded Forex Crunch, a blog crafted in his free time that turned into a fully-fledged currency website later sold to Finixio.
