By Nell Mackenzie and Summer Zhen

LONDON, July 18 (Reuters) - Hedge funds say they are prepared if U.S. President Donald Trump fires Federal Reserve Chair Jerome Powell before his term expires next year.

The dollar briefly tumbled on Wednesday and long-dated Treasury yields rose on reports that Trump is likely to fire Powell soon. Trump denied the reports.

Trump has repeatedly criticised the Fed chief for not cutting rates quickly enough.

Four hedge funds shared four ideas on how to trade an early Powell departure. Their views do not represent recommendations or trading positions, which they cannot reveal for regulatory reasons.

1/ RBC BLUEBAY ASSET MANAGEMENT

* Macro economic fund

* Size: part of the $491 billion RBC Global Asset Management

* Founded in 2001

* Key trade: Buy 2-year U.S. Treasuries, sell 30-year Treasuries

Trump has said that he would "love" it if Powell were to resign, and has called for interest rates to be cut to 1%. The current range for the key Fed funds rate is 4.25%-4.5%.

A new Fed chair would be pushed to cut rates, lowering front end yields, said Mark Dowding, CIO for BlueBay fixed income. Bond yields move inversely to price.

Two-year Treasury yields dropped following Wednesday's news reports, while 30-year yields briefly jumped US2YT=RR, US30YT=RR.

"Long-dated yields may well move in the opposite direction as Fed independence is undermined and medium-term inflation risks increase," Dowding said.

2/ FOURIER ASSET MANAGEMENT

* Convertible bond specialist

* Size: $10 million

* Founded in 2024

* Key trade: Buy Coinbase convertible bonds

Orlando Gemes, CIO and co-founder of Fourier Asset Management, favours convertible bonds issued by crypto exchange Coinbase. These bonds, which provide a steady income and can turn into shares at pre-agreed prices, are the fund's main focus.

"Our preference is the 2026 bond given the conversion price of $370.45, while the 2030 bond has a conversion price of $333.55," said Gemes.

Gemes does not expect a huge market reaction initially if Powell is fired but believes the result will be inflationary. If rates are cut, the yields on these convertible bonds will fall.

"But ultimately a Powell firing... would continue the inflationary nature of the Trump administration," said Gemes.

The U.S. Consumer Price Index rose 2.7% in June on an annual basis, versus 2.4% in May.

3/ COLOMA CAPITAL FUTURES

* Commodity Trading Advisor $(CTA.UK)$

* Size: Cannot disclose for regulatory reasons

* Founded in 2009

* Key trade: sell the dollar

David Burkart, founder and CIO of Caloma Capital, says he would sell the dollar against a basket of currencies.

"A Powell replacement is extremely likely to be dovish and thus the interest rate differential between the U.S. and other countries will narrow, reducing the relative attractiveness of the dollar," said Burkart.

Longer term, the U.S. debt and tax burden is increasing and risks slower U.S. growth which should also weigh on the dollar, he said.

Burkart believes the dollar index could potentially fall to 90 and that 80 is "not out of the question."

The dollar index .DXY, currently trading at around 98.56, has tumbled almost 10% so far this year.

4/UNION BANCAIRE PRIVEE $(UBP.AU)$

* Japan equity long/short hedge fund strategy, market-neutral, governance focused

* Size: Part of $200 billion UBP

* Founded in 2020

* Key trade: short Japanese exporters, especially those without overseas production bases

Zuhair Khan, senior portfolio manager at UBP Investments, who manages a long-short Japan equities fund, said he expects the yen to strengthen and most Japanese stocks to fall if Powell leaves early.

The blue-chip Nikkei 225 .N225 is down 0.2% so far this year, underperforming other major markets in Asia.

Domestic Japanese stocks are likely to fare better than exporters, though all of them are likely to fall, says Khan.

Within exporters, Khan favoured picking names with more overseas production aimed at those markets rather than those producing in Japan for export.

(Reporting by Nell Mackenzie; Editing by Dhara Ranasinghe and Toby Chopra)

((Nell.Mackenzie@thomsonreuters.com))