DailyFX.com -

Talking Points:

- July ISM Non-Manufacturing/Services at 58.7, the highest level since December 2005.

- ISM says “gains coming from almost every [US] industry.”

- EURUSD dives towards yearly low near $1.3366.

US economic data has been improving steadily over the last several weeks, aiding the US Dollar’s recent rebound. Although the greenback sold off modestly after the July US Nonfarm Payrolls report, it’s evident by the strength of hiring (>+200K in six consecutive months) that the US economy is hitting somewhat of a more consistent stride. Data released today fits in with this narrative.

Read more: EUR/USD, USD/CHF Flag Before Next Move - GBP/CAD Up Next

Two reports out this morning are helping the US Dollar continue along its recent bull run. Here’s the data lifting the buck:

- ISM Non-Manufacturing/Services Composite (JUL): 58.7 versus 56.5 expected, from 56.0.

- Factory Orders (JUN): +1.1% versus +0.6% expected, from -0.6% (revised lower from -0.5%) (m/m).

These data are notable as they both have achieved new relative highs. For the July ISM Services report, the headline reading at 58.7 is the highest such level since December 2005. Considering that nearly four out of five jobs in the United States are in service industries, the strong rates of gain in the index point to sustained economic momentum through midyear.

Similarly, the June Factory Orders report showed the fastest rate of expansion since March, and the gains represented the biggest ‘beat’ (actual minus expectation) in nine months.

See the US Dollar economic calendar for Tuesday, August 5, 2014.

EURUSD 1-minute Chart: August 5, 2014 Intraday

EUR/USD Back to Yearly Lows as ISM Services Hits 9 Year High

Charts Created using Marketscopeprepared by Christopher Vecchio

Around the announcement, EURUSD moved to fresh yearly lows at $1.3363, eclipsing the prior yearly low set last week at $1.3366. The US Dollar was moving up broadly across the board after the announcement, with USDCAD, USDCHF, and USDJPY all trading to/near their respective daily highs.

Read more: EUR/USD, USD/CHF Flag Before Next Move - GBP/CAD Up Next

Related Articles
  1. Investing

    The ABCs of Bond ETF Distributions

    How do bond exchange traded fund (ETF) distributions work? It’s a question I get a lot. First, let’s explain what we mean by distributions.
  2. Investing Basics

    Top Tips for Diversifying with Exotic Currencies

    Is there an opportunity in exotic currencies right now, or are you safer sticking to the major ones?
  3. Mutual Funds & ETFs

    The 3 Biggest Mutual Fund Companies in the US

    Compare and contrast the rise of America's big three institutional asset managers: BlackRock Funds, The Vanguard Group and State Street Global Advisors.
  4. Professionals

    5 Top-Rated Funds for Your Retirement Portfolio

    Mutual funds are a good choice for emotional investors. Here are five popular funds to consider.
  5. Mutual Funds & ETFs

    The 4 Best Buy-and-Hold ETFs

    Explore detailed analyses of the top buy-and-hold exchange traded funds, and learn about their characteristics, statistics and suitability.
  6. Chart Advisor

    Bumpy Roads Ahead In Transportation

    Investors are keeping an eye on the transportation industry. We'll take a look at the trend direction and how to trade it.
  7. Investing

    How ETFs May Save You Thousands

    Being vigilant about the amount you pay and what you get for is important, but adding ETFs into the investment mix fits well with a value-seeking nature.
  8. Mutual Funds & ETFs

    3 Fixed Income ETFs in the Mining Sector

    Learn about the top three metals and mining exchange-traded funds (ETFs), and explore analyses of their characteristics and how investors can benefit from these ETFs.
  9. Chart Advisor

    Agriculture Commodities Are In The Bear's Sights

    Agriculture stocks have experienced strong moves higher over recent weeks, but chart patterns on sugar, corn and wheat are suggesting the moves could be short lived.
  10. Investing News

    Top Tips for Diversifying with Mutual Funds

    Are mutual funds becoming obsolete? If they have something to offer, which funds should you consider for diversification?
  1. Can mutual funds invest in IPOs?

    Mutual funds can invest in initial public offerings (IPOS). However, most mutual funds have bylaws that prevent them from ... Read Full Answer >>
  2. Does index trading increase market vulnerability?

    The rise of index trading may increase the overall vulnerability of the stock market due to increased correlations between ... Read Full Answer >>
  3. What does a high turnover ratio signify for an investment fund?

    If an investment fund has a high turnover ratio, it indicates it replaces most or all of its holdings over a one-year period. ... Read Full Answer >>
  4. What is the difference between passive and active asset management?

    Asset management utilizes two main investment strategies that can be used to generate returns: active asset management and ... Read Full Answer >>
  5. Is there a situation in which wash trading is legal?

    Wash trading, the intentional practice of manipulating a stock's activity level to deceive other investors, is not a legal ... Read Full Answer >>
  6. Are there leveraged ETFs that follow the retail sector?

    There are many exchange-traded funds (ETFs) that track the retail sector or elements of the retail sector, and some of those ... Read Full Answer >>

You May Also Like

Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!