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Daily Report

Mar 22nd, 2018: Dollar Weaker Following Fed Inspired Collapse

Morning Report: 07.00 London

This morning, the US dollar index remains weak, following yesterday’s slump sparked by the Fed. Jay Powell’s first FOMC meeting produced projections which point to a worrying lack of growth in 2019. This provides a real stick in the eye to Trump’s growth plans.

The dollar pairs are mixed this morning though, following hefty gains yesterday. The AUD/USD has undone around half of yesterday’s gains so far today. This follows worse than expected Aussie employment data. Most other dollar pairs are so far unchanged.

The EUR/GBP continues to retreat, falling further yesterday to travel within range of testing the 0.8700 lows.

Most yen pairs have a slight negative bias this morning, following a mixed session yesterday. The USD/JPY saw follow-on selling, while most other yen pairs with the exception of the AUD/JPY made gains.

Gold is slipping back slightly after launching higher yesterday.

Coming up today

Today we have a range of European manufacturing and services PMI data points. This starts with French data at 08.00, then German at 08.30 and European at 09.00. German Ifo business climate is at 09.00.

UK retail sales are at 09.30.

At 12.00, we have the UK MPC meeting, with no expectations for a rate hike or asset purchases.

US unemployment claims are at 12.30.

MPC member Ramsden speaks at 17.00.

Trade Idea

The USD/JPY continues to struggle at the lows, following the latest bout of dollar weakness. More downside could be in the offing.

Mar 22nd, 2018: Dollar Weaker Following Fed Inspired Collapse

A good way to play this is a LOWER trade predicting that the USD/JPY will close below 105.50 in 21 days for a potential return of 121%.

Mar 22nd, 2018: Dollar Weaker Following Fed Inspired Collapse