FX Rate Bias US vs EU 2YFX Rate Bias – US vs EU (2Y)
This indicator implements a rate-differential based macro bias model using the 2-year government bond yield spread between the United States and Germany.
The methodology focuses on the short end of the yield curve, which primarily reflects central bank expectations rather than long-term inflation or risk premiums.
By applying light smoothing and a zero-line regime framework, the script classifies market conditions into USD rate advantage or EUR rate advantage states.
Calculation logic:
Retrieves daily 2Y sovereign yields for the US and Germany
Computes the yield differential (US − DE)
Applies optional smoothing to reduce noise
Uses the zero line as a regime boundary to define relative monetary bias
Practical use:
This tool is designed to provide directional macro context for FX analysis, particularly for EURUSD.
It helps traders align technical setups with prevailing interest rate expectations, and is not intended as a standalone signal or timing indicator.
Bounds
FX Rate Bias US vs EU 2YFX Rate Bias – US vs EU (2Y)
This indicator provides a macro bias framework for FX markets by tracking the 2-year government bond yield differential between the United States and Germany.
Rather than displaying the spread as a raw calculation, the script translates interest-rate expectations into a clear directional bias, helping traders understand which currency currently holds a rate advantage.
The 2Y segment of the yield curve is highly sensitive to:
Central bank expectations
Forward guidance
Shifts in short-term monetary policy outlook
How to use
Positive spread → USD rate advantage
Negative spread → EUR rate advantage
Designed to be used as a contextual macro tool, this indicator helps align technical setups with broader monetary conditions.
It is not intended as a standalone entry or signal generator.
