The USDCHF has been descending since the start of May and forex traders will get a double dose of US manufacturing data today which will include the key ISM Manufacturing Index. The prices paid and employment sub-indexes will be closely watched as the headline figure is expected to show an improvement over April. Economists further anticipate that construction spending rebounded from last month’s slump and that vehicle sales increased. Will economists be correct with their assessment and how will this impact the US Dollar? Today’s fundamental analysis will take a look at today’s start into a new trading week as the US-China trade war continues to escalate.
Here are the key factors to keep in mind today for US Dollar trades:
- US Markit Manufacturing PMI: The Final US Markit Manufacturing PMI for May is predicted at 50.6. Forex traders can compare this to the previous US Markit Manufacturing PMI for May which was reported at 50.6.
- US ISM Manufacturing Index: The US ISM Manufacturing Index for May is predicted at 53.0. Forex traders can compare this to the US ISM Manufacturing Index for April which was reported at 52.8. ISM Prices Paid for May are predicted at 52.0. Forex traders can compare this to ISM Prices Paid for April which were reported at 50.0. ISM Employment for May is predicted at 55.8. Forex traders can compare this to ISM Employment for April which were reported at 52.4.
- US Construction Spending: US Construction Spending for April is predicted to increase by 0.4% monthly. Forex traders can compare this to US Construction Spending for March which decreased by 0.9% monthly.
- US Vehicle Sales: US Vehicle Sales for May are predicted at 16.80M. Forex traders can compare this to US Vehicle Sales for April which were reported at 16.40M.
Economists predict a pick-up in inflationary pressures out of Switzerland, but the manufacturing sector is expected to remain in a contractionary state. The Swiss Franc has attracted an influx of safe haven traders, but will today’s data prompt profit taking or will a surprise lead to an acceleration of the trend? Forex trading news should be on everyone’s radar screen, even if the trading strategy is based on technical analysis. The reason for this is the impact each news cycle can have on price action.
Here are the key factors to keep in mind today for Swiss Franc trades:
- Swiss CPI: The Swiss CPI for May is predicted to increase by 0.3% monthly and by 0.6% annualized. Forex traders can compare this to the Swiss CPI for April which increased by 0.2% monthly and by 0.7% annualized. The Swiss Core CPI for May is predicted to increase by 0.6% annualized. Forex traders can compare this this to the Swiss Core CPI for April which increased by 0.5% annualized. The Swiss EU Harmonized CPI for May is predicted to increase by 0.8% monthly and by 1.4% annualized. Forex traders can compare this to the Swiss EU Harmonized CPI for April which increased by 0.6% monthly and by 1.1% annualized.
- Swiss Manufacturing PMI: The Swiss Manufacturing PMI for May is predicted at 48.8. Forex traders can compare this to the Swiss Manufacturing PMI for April which was reported at 48.5.
- Swiss Total Sight Deposits and Swiss Domestic Sight Deposits: Swiss Total Sight Deposits for the week of May 31at are predicted at CHF576.3B and Swiss Domestic Sight Deposits are predicted at CHF484.9B. Forex traders can compare this to Swiss Total Sight Deposits for the week of May 24th which were reported at CHF578.6B and to Swiss Domestic Sight Deposits which were reported at CHF485.0B.
Should price action for the USDCHF remain inside the or breakdown below the 0.9950 to 1.0015 zone the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Short Position
- Entry Level: Short Position @ 0.9980
- Take Profit Zone: 0.9715 – 0.9790
- Stop Loss Level: 1.0050
Should price action for the USDCHF breakout above 1.0015 the following trade set-up is recommended:
- Timeframe: D1
- Recommendation: Long Position
- Entry Level: Long Position @ 1.0075
- Take Profit Zone: 1.0200 – 1.0235
- Stop Loss Level: 1.0015
Open your PaxForex Trading Account now and add this currency pair to your forex portfolio. Trading with the right forex broker will have a great impact on your trading results. At PaxForex you earn more pips per trade due to excellent spreads and trading conditions, find out today why more successful forex traders operate their prime accounts here.
