EUR – Early trade into Asia saw rate contained within a tight $1.3011/19 range before it picked up demand on the back of another round of strong yen sales, the rise of euro-yen providing the momentum for traders to target $1.3040, barrier at $1.3050, as well as the stops above. The move extended on to $1.3068 before momentum faded and rate drifted back toward the broken resistance level at $1.3040 ahead of Europe (40-dma $1.3037, CTA’s like this average). Rate came under further downside pressure into Europe, the rate breaking back under $1.3040 with move extending through the early Asian base of $1.3008 to $1.3005 before demand placed into $1.3000 cushioned. Rate recovered but again met resistance on approach to $1.3040. Pullbacks remained above $1.3020 with moves still taking direction from yen plays.
GBP – Closed in NY at $1.5257 after rate had been pressured lower through the NY session, breaking back under $1.5300 before finding a base at $1.5239. The recovery into the close continued in Asia, aided again by sterling-yen demand, which took rate to highs of $1.5279. Rate eased off to $1.5264 but met further demand interest into the dip which allowed it to recover to $1.5270/75 into Europe. The early recovery extension in Asia was tempered as euro-sterling extended its recovery through the NY high of stg0.8532 to stg0.8560. However, the pullback from this high provided cable with some buoyancy in its Asian afternoon pullback, the cross easing back toward stg0.8540, though it was seen meeting demand in this area. Early pressure on euro-dollar, seen via euro-yen profit take sales, weighed on euro-sterling and allowed the cross to squeeze toward stg0.8525/20, which also provided cable buoyancy above $1.5250 ahead of UK output data. Cable edged to $1.5285 into data release, the stronger than forecast numbers spiking rate on to $1.5308. corrective pullback met support at $1.5285 before second wave demand extended recovery to $1.5319, as the cross eased on to stg0.85075.
JPY – Opened in early Europe at Y99.13 and Y129.19. Demand continued in early Asia and the rate lifted to Y99.66 where US names were the stand out buyers. Offers placed ahead of barrier interest at Y99.75 said to have aided resistance as Macro/CTA and Japanese bank sales emerged taking the rate off highs to Y99.09. Fresh demand recovered to Y99.50 but was unable to consolidate gains, later settling around Y99.20. Euro-yen tracked the move, extending its own recent recovery to a high of Y129.94 before faltering ahead of Y130.00, with sell interest seen from option players, along with exporter supply, eased to Y129.33. Profit take sales weighed on the yen pairs in early Europe, dollar-yen made a show under Y99.00, with euro-yen falling to Y128.86. Japanese name demand into Y98.80 provided a cushion before second wave sales pressed to Y98.70 and sat heavy. The cross slipped to Y128.44 meeting demand in the dip, rate tracked euro-dollar’s extended recovery to Y129.35, later easing to Y129.15. Dollar-yen saw sharp gains back above Y99.00 to print Y99.25, before paring light gains ahead of NY.
EasyForexNews Research Team