Yen pairs remained defensive in the US afternoon on Wednesday with cross supply adding weight to the dollar. Dollar-yen slipped to Y87.05 around the London fixing, before the rate tracked euro-dollar’s extended recovery to close at Y87.27. Euro-yen slipped to Y114.57, before dip demand cushioned moves. The cross bounced to Y114.80 and extended gains to close in NY at Y115.10. Trade volumes continued light and with Tokyo out on holiday risk appetite faltered despite the strong close in Wall Street. Euro-yen opened heavy and flushed some weak stops through Y114.95, extending losses to Y114.70 on Hedge fund sales. The cross made an attempted recovery but met strong head winds, fresh supply added weight to print Y114.47, before late trade recovered to settle around Y114.65. The early cross supply pressed dollar-yen to Y87.09, dip demand recovered and the rate extended the slow grind to Y87.30. Strong offers reported into Y87.50, techs behind at Y87.57/71 (20 & 26 Jul 10 highs), ahead of option related offers through Y87.80/95 defending the Y88.00 barrier.
EasyForexNews Research Team