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Dollar Back in Favour After NFP Miss08 October 2018 by Dave Evans

Morning Report: 07.00 London

The US dollar is back on the front foot following Friday’s NFP inspired sell-off. Payrolls increased less than expected, while unemployment improved. This gave a boost to dollar pairs on Friday, but this boost is receding this morning as the US dollar reassert its dominance.

The Austrian dollar is of particular interest as Chinese equities sell off severely this morning. The AUD/USD is holding at support around 0.7050 for now.

Elsewhere, the GBP/USD is on the back foot after Friday’s sizeable gains which were inspired by a fresh wave of Brexit confidence. Ireland and other European nationals have signalled a more accommodative approach with the UK. The EUR/GBP plunged below 0.8800 as the euro struggled and the pound gained.

The EUR/USD is on the back food after lagging yesterday as pressure on Italy intensified.

The USD/CAD is advancing for the fifth straight day, with the 1.3000 the next level of target.

The USD/JPY is making gains once again after falling from the highs on Thursday last week.

Coming up today

There are no economic items of note today. Though there are public holidays in Japan, Canada and the USA.

Trade Idea

The GBP/USD has performed relatively well recently as Brexit hopes increase. However, gains could be limited while losses could also have a floor as investors are wary of being caught out by a Brexit boost.

October 8th 2018: Dollar Back in Favour After NFP Miss

A good way to play this is an In/OUT trade predicting that the GBP/USD will close between a high of 1.3250 and a low of 1.2950 in 30 days time for a potential return of 150%.

October 8th 2018: Dollar Back in Favour After NFP Miss