After touching the 1.1185 mark on Monday, the EUR/USD began a decline. By the middle of Tuesday's London trading hours, the rate had reached the support of the 1.1100 level.
In regards to the near term future, the pair was expected to find additional support in the 55-hour simple moving average, which could push the pair up to the 1.1200 level.
US ISM Manufacturing PMI
The Euro traded sideways against the US Dollar, following the US ISM Manufacturing PMI survey results release on Monday at 15:00 GMT. The EUR/USD exchange currency rate gained 8 pips or 0.07% after the release. The Euro continued trading at the 1.1130 level against the Greenback after the release.
The Institute for Supply Management (ISM) released the US ISM Manufacturing PMI survey results, which came out worse-than-expected of 50.1 compared with the forecast of 50.5.
Timothy R. Fiore, the Chair of the Institute for the ISM Manufacturing Business Survey Committee commented: "Global supply chains are impacting most, if not all, of the manufacturing industry sectors. Among the six big industry sectors, Food, Beverage & Tobacco Products remains the strongest, followed by Computer & Electronic Products. Petroleum & Coal Products is the weakest. Overall, sentiment this month is marginally positive regarding near-term growth."
Economic Calendar Analysis
Some might consider watching the ADP Non-Farm Employment Change on Wednesday at 13:15 GMT. This event has mostly caused moves below ten pips. The exception was the 15.4 pip move in December.
On Wednesday, at 15:00 GMT the US ISM Non-Manufacturing PMI is set to be published. Last year, this event caused moves from 26.0 to 36.5 pips. This year, there were two moves of 7.9 and 9.1 pips.
On Friday, the US employment data will be released at 13:30 GMT. The event has caused moves from 15.5 to 41.4 pips since October.
This event consists of three data sets – the Unemployment Rate, Non-Farm Employment Change and the Average Hourly Earnings.
Meanwhile, the week's data is available. Click on the link below to see the historical data tables with the reactions to various events.
EUR/USD hourly chart's review
On Monday, the EUR/USD currency pair tested the resistance level—the monthly R1 at 1.1157. During today's morning, the pair was testing the weekly R1 at 1.1120.It is likely that the exchange rate could gain support from the 55-hour SMA near 1.1080 and trade upwards in the short term. In this case the rate would have to surpass the Fibo 38.20%, as well the weekly R2 at 1.1210.
However, if the monthly R1 holds, it is likely that the Euro could trade sideways against the US Dollar in the short run. Also, it is unlikely that bears could prevail, and the pair could decline below the 100-hour SMA near 1.1000.
Hourly Chart
On the daily candle chart, the rate has reached above the resistance of the daily simple moving averages. Moreover, the SMAs began to support the rate on Monday.
Daily chart
On Monday, the traders of the Swiss Foreign Exchange were short on EUR/USD, as 65% of all open position volume was in short positions.
By the middle of Tuesday's trading, the sentiment was 68% short.
Meanwhile, set up pending orders were set to sell, as 63% of orders in the 100-pip range were to sell and 37% were to buy.
Previously, 75% of orders were to sell and 25% were to buy.