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Daily Report

Risk-On as China-US Deal Nears04 March 2019 by Dave Evans

Morning Report: 07.00 London

This morning the dollar pairs are on the front foot as a China-US deal draws near. The dollar index is suffering as the AUD/USD gaps higher at the open, falling just short of resistance around 0.7100.

The GBP/USD has gapped higher at the open, and is well above support around the 1.3200 level. The EUR/GBP has slipped back lower as the pound returns too its out-performance status. The EUR/USD is struggling through as the morning’s opening gap is nearly closed.

The USD/CAD is down slightly after strong gains in the US dollar’s favour on Friday that saw the pair rise to test the 1.3300 level.

The USD/CHF is also making gains as traders shun the need for the Swissy’s safe haven status. The 1.0000 is still holding for now.

Yen pairs are on the front foot, with the USD/JPY trading just shy of 112.00. The GBP/JPY is the star of the show, trading above 148.00. The AUD/JPY also gapped higher, holding above 79.00. The EUR/JPY made minor gains which are slipping back this morning to challenge 127.00 again.

Gold is nudging higher this morning after slumping below $1300 on Friday.

Coming up today

There are only minor economic items today, with European PPI the most notable.

Trade Idea

The EUR/ GBP balance is firmly back in the pound’s favour this morning after two days of interest in the euro. In theory the pound will leave the EU this month, but the most likely scenario is a more market friendly resolution (an extension or something more dramatic)

Risk-On as China-US Deal Nears

A good way to play this is a LOWER trade predicting that the EUR/GBP will close below 0.8550 in 14 days for a potential return of 120%.

Risk-On as China-US Deal Nears