EUR/USD on session lows after strong US ISM services

The euro erased completely previously gained positions and fell to its lowest point during todays session against the US dollar, following the release of an upbeat ISM non-manufacturing report out of the United States.

EUR/USD touched a session low at 1.3232 at 14:03 GMT, after which the pair bounced off to trade at 1.3244. Support was likely to be received at July 29th low, 1.3238, while resistance was to be encountered at August 1st high, 1.3309.

Minutes ago, the Institute for Supply Management (ISM) said that the index of activity in the sector of services in the United States rose to a reading of 56.0 in July, reaching a five-month high, significantly outstripping estimates of a value of 53.1 and following the result of 52.2, recorded in June. 16 out of 18 sectors, researched by the ISM, managed to advance in July, as a month ago their number was 14. The sub index, gauging new orders, rose to 57.7 in July from 50.8 in June, while the sub index of output increased to a reading of 60.4 in July from 51.7 during the preceding month. The index of employment, however, dropped to 53.2 in July from 54.7 in June. Values, exceeding the crucial level of 50.0, are a signal that activity has expanded.

Meanwhile, in the Euro zone, retail sales registered a drop by 0.9% in June on annual basis, slightly below the expected larger drop of 1.3%, and after the indicator managed to enter positive territory in May, adding 0.3%, according to revised data. In monthly terms, retail sales decreased by 0.5% in June, after the recorded 1.1% increase a month ago, which was a revision up from 1.0% previously. The overall result came as no surprise, as first necessity sales dropped by 0.6% and sales of goods, excluding first necessities, decreased by 0.2% in June. The largest drops were registered in Estonia, Hungary, Austria and Germany, while in Malta and Denmark retail sales marked the best results in June.

Elsewhere, the euro fell to session lows against the British pound as well, with EUR/GBP cross down by 0.59% to trade at 0.8634. EUR/JPY pair also tumbled by 0.47%, trading at 130.73.