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US traders are returning from a long Memorial Day weekend. It was announced over the weekend that an agreement on the US debt ceiling has been reached, and it is taking some of the uncertainty off the markets. However, such a development was expected following upbeat comments from US officials ahead of the weekend and was reflected in Wall Street performance on Friday with all major US stock market indices closing over 1% higher.

There are a number of events scheduled for the later part of the week that may ensure US assets moving. Traders will be offered Conference Board index for May today at 3:00 pm BST, followed by ADP jobs report and manufacturing ISM on Thursday. The NFP report for May is a key macro report of the week and will be released on Friday, 1:30 pm BST.

Note that money markets boosted hawkish Fed bets after the debt ceiling deal announcement and now price in a 58% chance of a 25 basis point Fed rate hike at the June meeting. Solid data releases, especially NFP, would likely see those odds climb even higher.

Top US readings this week

  • Tuesday, 3:00 pm BST – Conference Board consumer confidence for May
  • Thursday, 1:15 pm BST – ADP employment report for May
  • Thursday, 3:00 pm BST – Manufacturing ISM for May
  • Friday, 1:30 pm BST – NFP report for May

S&P 500 futures (US500) saw a positive demand-side reaction to a retest of an earlier broken price resistance zone, marked with 50% retracement of the downward move launched at the beginning of 2022. Index climbed to a fresh 9-month highs yesterday. Better-than-expected release from the US economy this week could be a negative catalyst for US500 as they would strongly hint at more rate hikes from Fed. Two near-term levels to watch are marked with retracement of the aforementioned downward move – support at 50% retracement and resistance at 61.8% retracement.

Source: xStation5

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