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

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 15:00 GMT this Monday. Consensus estimate point to a modest uptick in the manufacturing sector activity and the index is seen edging higher from the previous month’s reading of 55.4 to 55.8 in October, marking the fifth consecutive month of expansion.

As Joseph Trevisani, Senior Analyst at FXStreet explains: “The August score of 56 was the highest since November 2018 as the US trade dispute with China had ended the expansion long before the pandemic struck in March. The June through September average of 54.6 is the best run for the outlook in manufacturing since the second half of 2018.”

How could it affect EUR/USD?

Given that the recent price action has been exclusively sponsored by developments surrounding the coronavirus saga, the data is unlikely to be a major game-changer for the USD. Moreover, investors might also refrain from placing any aggressive directional bets amid growing wariness about the actual outcome of Tuesday's US presidential election. Nevertheless, any meaningful divergence from the expected figures might still assist traders to grab some short-term opportunities.

Ahead of the important release, FXStreet’s own Analyst Yohay Elam offered a brief technical outlook and important technical levels to trade the EUR/USD pair: “The Relative Strength Index on the four-hour chart is below 30 – indicating oversold conditions and a potential for a bounce. The previous such dip triggered a temporary surge before euro/dollar resumed its falls. Will it happen again?”

“Support awaits at 1.1625, which was a low point in mid-September. It is followed by that month's trough of 1.1610, and then by 1.1550. Resistance is at 1.1650, which served as support last week, followed by 1.1695, a temporary cap. The next level to watch 1.1720,” Yohay added further.

Key Notes

  •  US October Manufacturing PMI Preview: Eyes on the New Orders Index

  •  EUR/USD Forecast: Next bounce may serve a sell opportunity on covid crisis, elections uncertainty

  •  EUR/USD Price Analysis: Looks cautious near 1.1600

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).