EUR – Closed in NY Friday at $1.3030 after rate had recovered off intraday lows of $1.2991, the dollar under pressure following the release of softer than forecast US Q1 GDP data. The GDP data, along with Jon Hilsenrath’s comment in the WSJ that the Fed is likely to continue their easy money policies, acted to weigh further on the dollar into Asia, with Italy forming a government over the weekend also key as euro-dollar picked up early demand. The early move triggered stops through $1.3060/65 taking it on to $1.3068. Macro/real money accounts were sellers off the highs as rate slipped to $1.3032, settling between $1.3045/55 through the Asian afternoon. Early Europe saw rate touch $1.3043 before fresh demand emerged that took rate up to retest overnight highs. Resistance at $1.3069 (76.4% $1.3094-1.2989) contained initial pressure but finally gave way to allow rate to retest recent highs at $1.3094. Rate extended highs to $1.3100 before meeting Asian supply which capped move at $1.3100. Weak Eurozone confidence indicators were countered by a smooth Italian bond auction allowing the rate to hold above $1.3080 in late morning trade. Euro was able to take advantage of a weak dollar, despite calls the ECB could cut rates Thursday.
GBP – Сlosed in NY Friday $1.5473 after rate had failed to take out barrier interest at $1.5500 on two attempts, easing off session highs of $1.5499, though underlying tone into the close remained buoyant. The pound continued to feel the positive effects from Thursday’s release of stronger than forecast Q1 GDP, and with dividend related demand (oil company interest rolls over into today along side HSBC dividend demand at around 1000GMT) expected to support this underlying positive tone, with the large Verizon-Vodafone buy out bubbling away in the background. Asia picked up the demand to take rate through $1.5500, with triggered stops extending the move to an eventual high of $1.5527 before momentum faded. Rate settled around $1.5520 ahead of the European open. Cable eased to $1.5512 in early Europe but shied away from reported demand into $1.5510 (stops below) before it got pulled higher by a stronger euro-dollar rally that saw it push up to $1.5547. Asian sovereign supply ahead of reported $1.5550 barrier interest countered before short term specs were squeezed on the corrective pullback to $1.5517. Rate edged back to the $1.5535 area into the 1100BST fix with a mix of interest reported to emerge.
JPY – Closed in NY Friday at Y98.05 after rate had traded with a heavy tone through Friday’s session. Early buying in Asian trade saw rate push up to Y98.12, before settling just above the figure into the main open (Japan closed). Dollar continued to hold soft following Friday’s GDP, with WSJ Hilsenrath comments expecting the Fed to continue easy monetary policies and FT note that Japanese investors are bringing money back onshore, acted to take rate through Y97.50, with triggered stops extending the move to Y97.35. Euro-yen tracked dollar-yen moves, touched an early high of Y128.04 before turning lower. Rate took out NY lows of Y127.15 before basing at Y127.06. Yen pairs later recovered to Y127.50/97.70. Euro-yen opened on a bid tone in Europe and lifted to Y127.75 in early trade. The rate was given a boost through Y128.00 in reaction to a real money a/c’s buy stance on the cross, extending gains to an eventual high of Y128.33 on Dutch bank demand. Momentum stalled, profit take sales added further weight to Y127.80, before dip demand cushioned to settle around Y127.90. Dollar-yen tracked the move, the rate stalling ahead of Y98.00 and slipped to Y97.65, later recovering to Y97.75 ahead of NY.
EasyForexNews Research Team