USD: Sharp Reversal on ISM Non-Manufacturing
The dollar index is on a roller coaster today as it reacted with a sharp drop down to 96.70, new multi month low, after the worst than expected US ADP report that posted a 9-year low at just 27,000 jobs in May. DXY managed to come back with a strong rebound after the ISM Non-Manufacturing PMI improves to 56.9 in May much better than analysts 55.5 expectations. The 96.70 mark where the 100 day moving average crosses proved a solid support. Now bulls are in the driver seat after the greenback managed to breach above the 50 hour simple moving average in a sharp reversal which can drive prices up to 97.40 the 100 hour moving average.
The strong upward move has erased investors concerns that the U.S. central bank is moving to an interest rate cut sooner than anticipated. In less than two hours the FED will release the Beige Book which will catch trader’s attention and probably initiate a new trend.