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Yen in Control as Traders Eye Safe Harbours30 April 2019 by Dave Evans

Morning Report: 07.00 London

The Japanese yen is in demand today on the day of the Emperor’s abdication. This comes after Chinese Manufacturing PMI and Chinese Caicin Manufacturing PMI both slumped below expectations, raising fears of a global economic slowdown.

The USD/JPY is reversing yesterday’s gains and is sitting below the 111.50 level. The EUR/JPY is also lower and eating into yesterday’s gains after failing to push through the 125.00 level last night. The GBP/JPY is also on the back foot after failing to break the 144.50 level.

The USD dollar index is continuing its decline despite the morning’s push for safe havens. Dollar pairs are mixed however, with the AUD/USD the worst performer so far, with the pair having tested both yesterday’s highs and lows. The EUR/USD is higher for the third day in a row after solid gains yesterday. The GBP/USD is also higher for the third day in a row, with the 1.2950 level set for a challenge.

The EUR/CHF is unchanged after surging higher yesterday to trade above 1.1400. The EUR/GBP is reversing some of yesterday’s gains but holding the 0.8640 level.

The USD/CAD is holding the 1.3450 level after three days of losses, while the USD/CHF is struggling after failing to break resistance at 1.0200.

Coming up today

Today, we have MPC member Ramsden speaking at 07.40.

European Preliminary flash GDP is at 09.00.

Canadian GDP and RMPI are at 12.30.

Chicago PMI is at 13.45.

US CB consumer confidence is at 14.00.

BOC governor Poloz speaks at 15.00.

Trade Idea

The heat has been off the UK in recent days as attention turns to the prospect of European elections in light of the latest extension.

We could see further drift during this time and a re-test of the 1.2900 lows.

Yen in Control as Traders Eye Safe Harbours

A good way to play this is a LOWER trade predicting that the GBP/USD closes below 1.2900 in 14 days for a potential return of 148%.

Yen in Control as Traders Eye Safe Harbours