NADEX, a binary options exchange platform, has an events contract posted with a buy price of $.98 on the EUR/USD exceeding 1.0275 by the end of this coming week. Assuming the Federal Open Market Committee does not make any changes to the federal funds rate, discount window, and interest on reserve balances, I estimate that the EUR/USD will be around 1.0290.
Even if the FOMC decides to decrease rates by 25 basis points, the currency pair could hit 1.02922, by my calculation. I am buying the bet that it will exceed 1.0275.
Overall, I don’t see the dollar weakening in the very short term. Commenters are wary of Europe’s continued poor economic performance and for consumers buying BMWs and Mercedes (does Europe produce anything else? Oh, yeah. Chocolate), they may again hone on some good deals for Christmas.
I remain on the lookout for negative policy news out of Europe or the United States. The FOMC meets this Tuesday and Wednesday, and the Electoral College will make it official that former U.S. president Donald J. Trump won the majority of votes by the Electors.
Alton Drew
15 December 2024
Disclaimer: The above sentiment is just that, sentiment. This is not legal or trading advice. Consult an attorney or investment advisor before making a trade.
Ready for your next trader challenge? Visit http://toptiertrader.com/?ref=1449
Lawyers Write the Bets. Bankers Sell the Bets. 