Lackluster ISM Manufacturing Survey to Fuel EUR/USD Rally

U.S. ISM Manufacturing to Hold Steady After Narrowing for Two Straight Months.

FOMC Minutes to Endorse Gradually Normalization Cycle.

Trading a News: U.S. ISM Manufacturing

ISM Manufacturing

The ISM Manufacturing consult is approaching to reason solid in Dec after squeezing for a past dual months, though another collection of muted information prints might eventually fuel a near-term convene in EUR/USD as it dampens bets for aloft seductiveness rates.

The Federal Open Market Committee (FOMC) appears to be on march to broach 3 rate-hikes in 2018 as officials continue to plan a depot rate between 2.75% to 3.00%, and a Dec assembly mins might mostly echo that ‘economic conditions will develop in a demeanour that will aver light increases in a sovereign supports rate’ as a economy approaches full-employment. However, signs of greater-than-expected tardy might prompt a FOMC underneath Jerome Powell to adopt a reduction hawkish tone, with a executive bank during risk of final a hiking-cycle forward of news as acceleration continues to run next a 2% target.

As a result, marketplace participants might continue to tame expectations for an approaching Fed rate-hike, with a dollar during risk of exhibiting a some-more bearish function over a near-term amid concerns of an inverting U.S. produce curve. Want to following along with pivotal discussions on stream marketplace themes and intensity trade setups? Sign Up Join DailyFX Currency Analyst David Song LIVE.

Impact that the ISM Manufacturing consult has had on EUR/USD during a previous print

November 2017 U.S. ISM Manufacturing

EUR/USD 5-Minute Chart


The U.S. ISM Manufacturing consult narrowed for a second uninterrupted month in November, with a index slipping to 58.2 from 58.7 a month prior. A deeper demeanour during a news showed a sign for factory-gate prices descending to 65.5 from 68.5 in October, with a Employment member circumference down to 59.7 from 59.8, while a Production index climbed to 63.9 from 61.0 during a same period.

The collection of churned information prints sparked a singular greeting in EUR/USD, with a sell rate entrance off a lows to finish a day during 1.1895. For additional resources, download and review a FREE DailyFX Advanced Guide for Trading a News to learn a 8 step strategy.

EUR/USD Daily Chart

EUR/USD Daily Chart

  • EUR/USD appears to be on a approach to exam a September-high (1.2092) as it breaks out of a operation from late-2017, with a Relative Strength Index (RSI) highlighting a identical energetic as it appears to be pulling into overbought domain for a initial given a summer months.
  • Keep in mind, a broader bull-flag arrangement appears to be unfolding, with a break/close above a 1.2130 (50% retracement) jump opening adult a 1.2230 (50% retracement) segment followed by a Fibonacci overlie around 1.2320 (23.6% retracement) to 1.2370 (61.8% expansion).

— Written by David Song, Currency Analyst

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