- – The Euro after trading as high as 1.1256 against the US Dollar started a downside correction.
- – The EUR/USD pair is currently trading near a major bullish trend line with support at 1.1215 on the hourly chart.
- – The US Institute for Supply Management (ISM) Manufacturing Index for May 2017 released recently, posted an increase from 54.8 to 54.9.
US ISM Manufacturing Index
Recently in the US, the Institute for Supply Management (ISM) Manufacturing Index for May 2017 was released. The market was positioned for a minor decline from the last reading of 54.8 to 54.5 in May 2017.
However, the actual result was above the forecast, as the Manufacturing Index posted an increase from 54.8 to 54.9 in May 2017. Similarly, the Markit Manufacturing PMI posted a rise from 52.5 to 52.7 in May 2017. The ISM report mentioned that the “New Orders Index registered 59.5 percent, an increase of 2 percentage points from the April reading of 57.5 percent. The Production Index registered 57.1 percent, a 1.5 percentage points decrease compared to the April reading of 58.6 percent.”
Overall, the EUR/USD is under pressure below 1.1240, and the US NFP release today may have a greater impact in the near term.
EUR/USD Technical Analysis
The Euro made a nice upside move this week, trading above the 1.1200, 1.1210 and 1.1240 resistance levels against the US Dollar. The EUR/USD pair traded as high as 1.1256 where it faced resistance and started a downside move.
The pair has already breached the 38.2% Fib retracement level of the last wave from the 1.1164 low to 1.1256 high. At present, the pair is trading near a major bullish trend line with support at 1.1215 on the hourly chart. The trend line support at 1.1215-10 holds the key for the next move.
The 50% Fib retracement level of the last wave from the 1.1164 low to 1.1256 high is just below the trend line at 1.1210. As long as these support levels are intact, the pair may bounce back above 1.1240. If the Euro buyers fail to defend the 1.1210 support area, there can be a downside break towards the 1.1160 level in the near term, especially with the US NFP release for May 2017 later today.Tags: EUR/USD Technical Analysis, Euro, US Dollar