FX.co ★ Global macro overview for 02/01/2017

Global macro overview for 02/01/2017:

According to the Institute for Supply Management, the Chicago Purchasing Managers' Index (PMI) fell to 54.6 points in the reported month after rising to 57.6 a month ago. Market participants anticipated a slight increase to 56.5 points, so they were surprised by worse than expected data. The main driver behind the fall is a slump in new orders, which fell 6.7 points to 56.5. It is worth pointing out, that any reading above the 50 points still indicates expansion in the business activity. The overall sentiment in the US after the presidential election is still positive as the majority of Americans expects the new administration to bring positive changes, so their businesses could benefit from them.

Let's now take a look at the EUR/USD technical picture at the 4H time frame. The sudden rally towards the technical resistance at the level of 1.0671 was stalled at the level of 1.0655, so the bull wasn't strong enough to break out above it. Currently, the market is back to the trading range and the next support is seen at the level of 1.0372.