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Dollar Recovers On China Slowdown Fears05 March 2019 by Dave Evans

Morning Report: 07.00 London

The US dollar index is building on yesterday’s gains as traders seek out safe havens on the back of China GDP concerns. China is projecting growth of ‘just’ over 6% as the trade war bites, forcing traders to turn the perceived safety of the Greenback.

Dollar pairs are struggling, with the AUD/USD trading below the 0.7100 level and slowing further below last week’s losses. The RBA kept rates on hold at 1.50%.

Meanwhile, the EUR/USD crashed below 1.1350 yesterday after reversing Monday’s early opening gap lower. The GBP/USD followed suit, with early promise giving way to selling pressure that forced the pair below 1.3200, with follow on selling this morning.

Elsewhere, the USD/CAD continues to gain following the March 1st rally that pushed the pair to 1.3300. The USD/CHF remains rangebound however, struggling to make any progress either way from the 1.0000 parity line.

The yen pairs are mixed, with the USD/JPY making gains and challenging the 112.00 level. The AUD/JPY is unchanged and holding the 79.00 level. The EUR/JPY is enjoying small gains after falling below 127.00, while the GBP/JPY is unchanged after significant losses below 148.00 yesterday.

Coming up today

At 09.30, we have UK Services PMI.

FOMC Member Resengren speaks at 12.30.

ISM Non-Manufacturing PMI is at 15.00.

BOE governor Carney speaks at 15.35.

Trade Idea

The USD/JPY remains poised for higher levels as markets balance the two safe havens. The dollar has momentum behind it, making bets on higher levels attractive.

Dollar Recovers On China Slowdown Fears

A good way to play this is a HIGHER trade predicting that the USD/JPY will close above 112.00 in 14 days for a potential return of 103% if successful.

Dollar Recovers On China Slowdown Fears