Fed Fear Builds USD, Greece Unnerves the Euro but S&P Yet to Collapse

Talking Points:

• USDollar pulled back from the brink this past week with additional help from a hawkish Yellen

• Europeans are hoping for the best with Greece, but traders should be ready for the worst

• The S&P 500 and risk trends grow increasingly detached from reality, only a matter of time...

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Though this past week was fueled by plenty of volatility, the moves we've seen in FX, equities and the broader financial system were the 'comfortable' ones. The difficult - and for some, overdue - shifts have yet to be made. For the USDollar, a rebound from the floor of its nine-month trend channel eventually found support in Fed Chairwoman Yellen's remarks through the end of this past week. NFPs, the Fed's preferred inflation report (PCE deflator) and a range of FOMC speakers ahead will help shape conviction. Yet, the Greenback's rebound falls within a well-established range - the path of least resistance. Meanwhile, the Euro eased back from its run, but the EURUSD hold at 1.10 hardly reflects the risk that looms for Greece as it runs short on liquidity and time. The greatest corner of complacency for the financial system, however, still resides in general 'risk' trends - particularly the S&P 500. Despite this past week's pullback, the necessary pressure release was not found. We look at the risks and opportunities the market is shaping for the week/s ahead in this weekend Trading Video.

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