US ISM Manufacturing PMI Overview
The Institute of Supply Management (ISM) will release its latest manufacturing business survey result, also known as the ISM Manufacturing PMI at 14:00 GMT this Wednesday. Consensus estimate point to a further recovery in the manufacturing sector activity in June and the gauge is seen rising to 49.5 from 43.1 previous.
Meanwhile, Joseph Trevisani, Senior Analyst at FXStreet, offered his take on the performance of the various sub-components and explained: "The employment index is expected to climb to 43.0 from 32.1 in May and 27.5 in April which was the second-lowest reading in the 72 years of the survey. Only the June 1948 score of 27.2 in the severe post-war recession was worse. The price paid index is predicted to rise to 43 in June from 32.1. New orders are expected to gain 36.1 from 31.8 in May."
How could it affect EUR/USD?
The recent optimism over a sharp V-shaped global economic recovery has been overshadowed by concerns about the second wave of coronavirus infections. Hence, any positive surprise might do little to provide any meaningful impetus to the EUR/USD pair. That said, a weaker reading will add to market worries and provide a modest lift to the US dollar's relative safe-haven status against its European counterpart.
Meanwhile, Yohay Elam, FXStreet's own analyst offered important technical levels to trade the EUR/USD pair: "Initial resistance awaits at 1.1265, which was a swing high on Tuesday and where the 100 Simple Moving Average hits the price. The next cap is a 1.1285, the weekly high. It is followed by 1.1350, a double-top from June."
"Below the double-bottom of 1.1190, the next cushion is close – 1.1165, a low point earlier in June. Further down, the next support line is only at 1.1075, dating back to early last month," Yohay added further.
About the US ISM manufacturing PMI
The Institute for Supply Management (ISM) Manufacturing Index shows business conditions in the US manufacturing sector. It is a significant indicator of the overall economic condition in the US. A result above 50 is seen as positive (or bullish) for the USD, whereas a result below 50 is seen as negative (or bearish).
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