Dollar dominates, governments act, RAs downgrade

The dollar continues to dominate in the FOREX. The secret of his success is simple - the increased demand for U.S. Treasury bonds during the crisis, high liquidity of the dollar, as well as the relatively good situation in the U.S. economy, coupled with measures to support it and the current epidemiological situation in the country comparing with the other problem currencies (Euro, pound, commodity currencies).

Anyway, the Dollar Index has reached its highest level since 2017 and, on the whole, looks rather overbought. That is, with his purchases one should be careful and more selective.

The optimal trading tactics for today, in our opinion, is active trading based on the signals from oscillators. Moreover, we recommend using not the classic RSI or Stochastic, but our author's Ranger, since now it is critical to understand where specific pair can go in terms of absolute price values. So today in the FOREX we will both buy and sell.

The pandemic, meanwhile, continues, and problems in the global economy continue to grow like a snowball. And this week the worst is beginning to happen - rating agencies have started to downgrade ratings. This is extremely alarming, because after the blowing up of the stock market bubble (from which greedy investors will mostly suffer. Which will be exclusively their own problems in some way even deserved), the corporate debt market bubble will begin to collapse. This topic is much more serious and potentially more destructive for the global economy. The word default can become very typical in the news.

In general, there is no reason to take a breath. This means that purchases of gold and other safe haven assets continue to be relevant, as well as sales in global stock markets.

It should be noted that in the fight against the crisis the Central Bank, have already largely spoken their words and now it is the turn of governments. That is, we are moving from monetary measures to fiscal stimulus. The White House is preparing to help the US economy for $ 850 billion. France prepared a package of measures for $ 335 billion, Germany for $ 500, etc.

As for our favorite positions for today, this is without a doubt the sell of EURGBP. We will talk about the motivation for this deal in a separate report, which we will publish today later.