Major dollar pairs, including EUR/USD, have parked near key technical levels ahead of Fed Chair Warsh's speech at Jackson Hole, with traders unwilling to commit before he speaks. Treasury yields ticked higher across the curve into the event, while stocks traded mixed.
Traders have pushed EUR/USD and the other major dollar pairs into position near technical levels rather than betting ahead of Fed Chair Warsh's speech at Jackson Hole. The setup reflects genuine uncertainty: the market does not know what tone Warsh will strike, so it is waiting for him to drive the next move.
Warsh's tone is the swing factor
The market's read on the speech hinges on whether Warsh leans toward President Trump or away from him, and how convincing he sounds to traders and fellow Fed officials.
Equities gave little away ahead of the speech. The Dow added 90 points while the S&P 500 rose 7.50 points, or 0.09%, and the Nasdaq sat unchanged, leaving stocks mixed.
Treasury yields edge higher across the curve
Treasury yields moved higher across the curve into the speech. The 2-year yield rose to 4.238%, up 0.6 basis points, while the 10-year climbed to 4.680%, up 0.8 basis points, with the biggest increases concentrated in intermediate and longer maturities.
The curve stayed upward sloping into the speech. The 2-year/10-year spread held near 44 basis points and the 2-year/30-year spread sat around 96 basis points, with the 5-year yield at 4.405%, up 0.9 basis points, and the 30-year at 5.197%, up 0.6 basis points.
That backdrop leaves EUR/USD positioned at a technical level with the dollar's next direction resting on Warsh's words.
Source: InvestingLive
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