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Dollar hits 2-week peak as virus fears drive safe-haven bid

The dollar rose to a two-week high against major peers on Tuesday, propelled by rising U.S. bond yields and increasing safe-haven demand amid growing fears about a second wave of coronavirus infections, which sent riskier currencies lower.

The biggest loser was the Australian dollar, which dropped about 0.8% to a one-week low, while the kiwi extended falls.

The euro fell below $1.08 for the first time in almost a week and the Japanese yen nursed an overnight loss of about 1% to sit at to 107.48 per dollar, the bottom end of a range it has kept since mid April.

At the same time, progress on plans to re-open economies has been overshadowed by worries about fresh infections of Covid-19 as easing of restrictions in South Korea and Germany were soon met by spikes in new cases there.

Dollar returns to dominate, US inflation eyed

The market mood is somewhat risk-averse, with stocks on the back foot while the dollar and the yen advance. Oil stands out with gains amid Saudi output cuts. Bitcoin’s performance is eyed after the halving event. Fears of a second wave of coronavirus infections

US President Donald Trump has continued urging a return to normal while touting tests and a flattening curve. However, disease data remains stubbornly high and even spiking in several areas, according to the internal data held by the administration.

Inflation figures in the US are projected to show a significant drop in headline prices due to the crash in oil prices, yet also excluding volatile items, monthly falls are on the cards.

Oil prices have been holding their ground despite the moderate risk-off mood. Saudi Arabia announced it would further reduce production, going beyond the OPEC+ agreement. Fears of filling storages remain significant.

GBP/USD is on the back foot, and that can partly be attributed to Prime Minister Boris Johnson’s confusing messages about getting back to work. The PM has tweaked his message between Sunday and Monday. Brexit talks continue at full speed.

According to Trading Central (3rd party RIA) the GBPUSD is short positions below 1.2640 with targets at 1.2160 & 1.1950 in extension.

* Past performance is not a guarantee of future performance

Number of Lots:Required Margin:Risk Management (50%):Potential Profit/Loss 1.2160
1€ 3,800.84€ 1,900.42€ 1,571.14
5€ 19,004.18€ 38,008.36€ 7,855.70
10€ 38,008.36€ 76,016.72€ 15,711.40
25€ 95,020.90€ 190,041.81€ 39,278.50
50€ 190,041.81€ 380,083.62€ 78,557.00

According to Trading Central (3rd party RIA) the USDJPY is short positions below 109.35 with targets at 105.15 & 103.10 in extension.

* Past performance is not a guarantee of future performance

Number of Lots:Required Margin:Risk Management (50%):Potential Profit/Loss 105.15
1€ 4,623.21€ 2,311.60€ 1,333.00
5€ 23,116.04€ 46,232.09€ 6,665.00
10€ 46,232.09€ 92,464.17€ 13,330.00
25€ 115,580.21€ 231,160.43€ 33,325.00
50€ 231,160.43€ 462,320.85€ 66,650.00

According to Trading Central (3rd party RIA) the WTI is long positions above 15.50 with targets at 29.00 & 36.25 in extension.

* Past performance is not a guarantee of future performance

Number of Lots:Required Margin:Risk Management (50%):Potential Profit/Loss 29.00
0.5€ 1,130.84€ 565.42€ 2,098.94
1€ 2,261.67€ 1,130.84€ 4,197.87
5€ 11,308.37€ 5,654.18€ 20,989.37
10€ 22,616.74€ 11,308.37€ 41,978.73
20€ 45,233.47€ 22,616.74€ 83,957.47

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