Markets were rattled once again today, following the release of weaker-than-expected manufacturing data in the US. According to the findings of the Institute for Supply Management (ISM), manufacturing PMI in the United States fell to 57.5 index points in November.
Last month's deterioration represents a significant setback from the 59.3 index points that were recorded in October. Owing to the massive success that was observed in the first month of Q4, market experts were anticipating a comparatively smaller contraction to 57.9 points.
The overall manufacturing output recoiled in November owing to the dampened epidemic conditions, coupled with the uncertainty stemming from the presidential election in the first part of the month.
Similar performance was recorded in the Eurozone, where German and French manufacturing suffered as well. Meanwhile, China's industry continues to perform comparatively better, as coronavirus fallout is much smaller there.
Today's news comes at a particularly bad time for the reeling dollar, which touches a two-year low against other major currencies. As can be seen on the daily chart below, the EURUSD is currently attempting to break out away from a prominent range.
The latter spans between the major support level at 1.16400 and the major resistance at 1.19500. Notice also that the price action is currently testing the psychologically significant resistance at 1.20000, which has been prevalent for over 32 months now.
Needless to say, the EURUSD pair currently finds itself at a make-it-or-break-it situation. A decisive breakout above the 1.20000 mark would allow the market bears to thread into uncharted territory, at least over the past two years. In contrast, a rebound from the resistance could potentially be perceived by the market as an indication that the bullish rally might be coming to an end.
The widening Bollinger Bands indicate the rising levels of volatility, whereas the MACD indicator underpins growing bullish momentum.