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Dollar Rebounds Ahead of FOMC20 March 2019 by Dave Evans

Morning Report: 07.00 London

The US dollar index is on the rise ahead of this evenings FOMC meeting where the Fed are widely expected to keep rates on hold, but signal future intentions.

Dollar pairs have a negative bias as dollar strength makes an impact. The AUD/USD is lower for the second straight day, but is so far well above the morning’s lows below 0.7060. This comes amid growing concerns over China trade deals. The EUR/USD is also lower and failing to break through 1.1350 after three solid days of gains.

The GBP/USD is trading in a tight range as Brexit enters another round of confusion, with the EU imposing potential conditions on a delay scenario such as a fresh referendum. The EUR/GBP is higher for the third straight day as euro strength pips the pound.

The USD/CAD is on the rise after staging a considerable recovery off the lows at 1.3250. The USD/CHF is also higher after three days of hefty losses that have pushed the pair below the 1.0000 level.

The USD/JPY is higher and trading above the 111.50 level. Other yen pairs are mixed, with the AUD/JPY unchanged having recovered form the morning’s lows. The EUR/JPY is higher and building on yesterday’s gains. Meanwhile, the GBP/JPY is struggling to break through resistance at 148.00.

Coming up today

This morning we have UK CPI at 09.30, released alongside PPI and RPI.

The day is all about the FOMC statement at 18.00, with economic projections and funds rate. The press conference follows at 18.30.

Trade Idea

The GBP/USD enjoyed a strong run recently on speculation that Brexit will be delayed. Now we are inching closer to the reality of a delay and markets are getting jittery. The delay confirmation could go to the wire, which might mean lower levels until the deadline.

Dollar Rebounds Ahead of FOMC

A good way to play this is a LOWER trade predicting that the GBP/USD will close below 1.3200 in 7 days for a potential return of 125%.

Dollar Rebounds Ahead of FOMC