When is the US ISM Non-Manufacturing PMI and how could it affect EUR/USD?

Haresh Menghani FXStreet

US ISM Non-Manufacturing PMI Overview

The Institute of Supply Management (ISM) will release the Non-Manufacturing Purchasing Managers' Index (PMI) - also known as the ISM Services PMI at 14:00 GMT this Wednesday. Consensus estimated a modest deceleration in growth to 55.9 for the month of June as compared to a three-month high level of 56.9 recorded in the previous month.

According to analysts at Danske Bank - “The ISM non-manufacturing survey will be giving an interesting indication of whether the service sector is feeling the pinch from the troubles in the manufacturing sector and global economy. Market consensus expects a reading of 56.5. The service PMI has dropped in recent months to nearly 50, which has been a worry for the Fed. Hence a poor reading today would ignite expectations of a considerable upfront Fed easing.”

Deviation impact on EUR/USD

Readers can find FX Street's proprietary deviation impact map of the event below. As observed, the reaction in case of a relative deviation of -0.70 or +0.63 is likely to be in the range of 21-26 pips in the first 15-minutes and could stretch to around 51-pips in the subsequent 4-hours.

How could it affect EUR/USD?

Yohay Elam, FXStreet's own analyst outlines the technical set-up and offers important levels to trade the EUR/USD pair – “Initial support awaits at 1.1270, the daily low. It is closely followed by 1.1250 that capped the pair in mid-June. Next, 1.1220 was a swing low in early June and a support line later that month. 1.1180 follows closely.”

“Resistance awaits at 1.1320 which capped it on Tuesday. Close by, 1.1350 is a separator of ranges, first holding the pair down in mid-June and then providing support later that month. 1.1390 and 1.1410 are next,” he added further.

Key Notes

• US Services PMI Preview: Worry is normal but contained

• EUR/USD Technical Analysis: Upside limited by the 200-day SMA at 1.1337

• EUR/USD faces a wall of resistance as markets digest Lagarde's nomination – Confluence Detector

About the US ISM non-manufacturing PMI

The ISM Non-Manufacturing Index released by the Institute for Supply Management (ISM) shows business conditions in the US non-manufacturing sector. It is worth noting that services constitute the largest sector of the US economy and result above 50 should be seen as supportive for the USD.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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