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

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 and the consensus forecast for the month of May stands at 55.5, matching the previous month's reading. 

As analysts at TD Securities note: “We do look to ISM services today as a notable data point for the broad USD, where disappointment here will likely further challenge the notion of US exceptionalism. Indeed, the ISM manufacturing/services spread has often coincided with phases of appreciation/depreciation in the broad USD.”

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 +0.90 or -0.69 is likely to be in the range of 22-29 pips in the first 15-minutes and could stretch to around 68-103 pips in the subsequent 4-hours. In the last five releases, the pair moved, on an average, 13-pips in the first 15-minutes after the data release and 38-pips in the following 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 major: “EUR/USD has been battling the former triple-top of 1.1265 that it only temporarily conquered on Tuesday. While momentum remains positive, the relative strength index is just above 70 – indicating overbought conditions. It seems that the currency pair will continue struggling for a direction for some time.”

“Next up, we find 1.1305 that held the currency pair down in a recovery attempt later that month. 1.1325 was the high point in April and is the next line to watch. Looking down, 1.1225 was a swing low on Tuesday and works as support. 1.1190 is where the 50 and 100 simple moving averages converge. Further down, 1.1145 capped EUR/USD in late May and 1.1125 cushioned it around the same time,” he added further.

Key Notes

   •  US Services PMI Preview: Down but not out

   •  EUR/USD Forecast: Bulls may need to wait despite Powell losing his patience

   •  EUR/USD: Rally has reached the 100 day ma - Commerzbank

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.