The dollar held strong gains on Tuesday as investors cheered a tariff deal between the United States and China to tap the brakes on a trade war between the world's two largest economies that had fed fears of a global recession.

One glance at BofA’s currency and rates sentiment survey would have indicated a sharp reversal was imminent in the event of any positive macro developments.

The dollar jumped and government bonds sold off as markets reacted to a de-escalation in the trade war between China and the US, which agreed to temporarily lower some tariffs for 90 days.