EURUSD – Up
EURUSD trading plan:
Debt ceiling negotiations between U.S. President Joe Biden and top congressional Republican Kevin McCarthy continued to cast a shadow over the market mood, though news that the two are closing in on a deal aided trader sentiment and caused the greenback to pause its recent rally. Money markets are now pricing in a 40% chance that the Federal Reserve will deliver another 25-basis-point rate hike at its policy meeting next month, while expectations that the Fed will begin cutting rates later this year have been scaled back. Spreads on U.S. government one-year credit default swaps – market-based gauges of the risk of a default – widened to 175 basis points, an all-time high, earlier in May on rising fears lawmakers could not reach a debt ceiling deal.
Investment idea: range 1.0700 – 1.0789.
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