USD Still Bullish In Spite of ISM Miss
While today is all about the FOMC decision in the evening (7:00 pm BST), it does not mean that the US economic calendar for the earlier part of the day is empty. Investors were already offered a disappointing ADP employment report for April and now the time has come for a release of services ISM data.
Data for April was released at 3:00 pm BST and was expected to show headline index improving from 58.3 pts in March to 58.5 pts now. However, actual report showed a drop to 57.1 pts. Employment subindex dropped from 54.0 to 49.5. Meanwhile, prices subindex jumped from 83.8 to 84.6 pts, reaching another multi-year high. Nevertheless, market reaction was minor as investors remain focused ahead of FOMC decision.
Taking a look at the US dollar index (USDIDX) at the H1 interval, we can see that the index has been trading in an ascending triangle pattern recently. USDIDX bounced off the trendline marking the lower limit of the pattern earlier today. USD strengthened slightly following ISM services release and is now testing 50-hour moving average in the 103.48 area (green line on the chart below).