It was a busy day on the economic data front, Wholesale Inventories rose 0.4% on month in the April preliminary reading (-0.7% expected), from a revised -1.0% in March final reading. Personal Income jumped 10.5% on month in April (-5.9% expected), from a revised -2.2% in March, marking a record high. Personal Spending dropped 13.6% on month in April (-12.8% expected), from a revised -6.9% in March, marking a record low. Market News International’s Chicago Purchasing Managers Index fell to 32.3 on month in May (40.0 expected), from 35.4 in April, a low last seen in 2009. Finally, the University of Michigan’s Consumer Sentiment Index declined to 72.3 on month in the May final reading (74.0 expected), from 73.7 in the May preliminary reading.
On Monday, Markit’s US Manufacturing Purchasing Managers’ Index for the May final reading is expected to be released. Construction Spending for April is expected to decrease 7.0% on month, from +0.9% in March. Finally, the Institute for Supply Management’s Manufacturing Purchasing Mangers’ Index for May is expected to rise to 43.5 on month, from 41.5 in April.
Yesterday we identified the EUR/USD pair breaking above an ascending triangle bullish continuation pattern on a 30-minute chart. Today the EUR/USD reached our first target and is now taking a pause. Traders that remain bullish might want to consider tightening stops to meet the 1.09 support level. Key resistance is set at today’s high around 1.1145. A break below 1.09 support may call for a test of the 1.1065 area.