S&P Global is due to publish its preliminary September US Purchasing Managers\u2019 Indices on Wednesday at 13:45 GMT, offering an early read on private-sector momentum. The release covers Manufacturing PMI, Services PMI and the Composite PMI, with readings above 50 signalling expansion and below 50 pointing to contraction. Produced monthly ahead of many official datasets, the surveys track activity such as output, exports, capacity utilisation, employment and inventories.<\/p>\n\n
Markets are pricing a modest cooling, with the flash Manufacturing PMI seen edging down to 53.5 from 53.9, while Services PMI is forecast at 56.0 versus 56.5. For EUR\/USD, technical levels referenced around moving averages include the 200-day SMA above 1.1620, as well as the 55-day and 100-day SMAs at 1.1526 and 1.1542, with a further reference point at 1.1711. On the downside, cited supports include 1.1353 and 1.1324; momentum gauges referenced include RSI near 31 and ADX near 29.<\/p>\n\n
Today’s release of the US preliminary PMIs is a critical pivot point, and we recommend that derivative traders position themselves for continued US dollar strength. With the Services PMI projected at a healthy 56 and Manufacturing at 53.5, the data continues to support the narrative of US economic resilience. This outperformance keeps the Federal Reserve on a cautious path, making bearish bets on EUR\/USD highly attractive.<\/p>\n\n
As EUR\/USD trades below its critical 200-day Simple Moving Average of 1.1620, we advise using short-term put options to capitalize on further downward momentum. If the PMI numbers beat expectations today, the currency pair is highly likely to slide toward its previous bottom of 1.1324. Technical indicators support this move, with the Relative Strength Index near 31 and the Average Directional Index at 29 signaling a powerful bearish trend.<\/p>\n\n
Historically, wide growth divergences between the US and the Eurozone have heavily favored the greenback, similar to the late 2023 trend when US GDP grew at a robust 4.9% annualized rate while the Eurozone stagnated. Recent European data shows persistent manufacturing weakness, with Germany\u2019s industrial PMI frequently languishing below the 45-point contraction mark. This stark contrast suggests that any temporary euro rallies will likely face heavy resistance at the 55-day and 100-day moving averages near 1.1526 and 1.1542.<\/p>\n\n
To manage risk in the coming weeks, we can utilize bear put spreads on EUR\/USD, which limit upfront premium costs while targeting the 1.1353 support level. Alternatively, selling out-of-the-money call options above the 1.1620 resistance level allows us to collect premium while expecting the US dollar to remain dominant. Watching the 13:45 GMT release closely today will let us adjust our leverage as the market reacts to the official numbers.<\/p>\n\n\n\n