Disliked{quote} Done, M&M's €500bns revovery fund proposal taking the upper hand on german court's ruling : {image} => Road is now open to (re)start to price in FED's monetary policy. We can have a parabolic move to the upside in EURUSD with only shallow retraces if markets decide to fully price in FED's open-ended purchases. Last break up points mark areas where to try to load : @1.089x, 1.085x and 1.082xIgnored
M&M's €500bns recovery fund's proposal if accepted will be a paradigm shift for European Union.
Flow we've seen this week in EURUSD is nothing compared to what will happen once/if the proposal is accepted.
It's only the beginning, EU bonds are going to be a game changer.
It's not reported in FF's calendar, but next week we have an important date on that topic on May 27th :
European Commission is expected to unveil their recovery plan that day.
=> What markets will be tracking is how M&M's proposal is going to be integrate in Van der Leyden's plan. Is it going to be fully integrated, partially or not at all ?
Tbh, I don't see how it will not be fully integrated in her plan as it look obvious to me M&M have already discussed about that with her before launching that press conference.
Then for the final agreement, we willl have European Council on June 18th/19th.
So far, 4 countries are against the proposal : Denmark, Sweden, Austria and Netherlands (the usual suspects but for the first time since EU's creation, Big Germany is not with them, that's key)
=> Denmark & Sweden are very soft resistances
=> Austria : Sebastian Kurz is very vocal lately but if he blocks the plan he will lose his coalition as Austria's greens are backing the proposal. So he looks pretty tied.
=> Netherlands are the only strong resistance I see. But they will end very isolated so that doesn't look like an sustainable position in the long run.
These resistances are somehow justified : If Spain, Portugal and France have made a lot of structural reforms these last years, Italy didn't. That would have made things easier.
In any case, end of Q2 going to be very exciting in EURUSD.
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