The pair closed a Monday trading session around Y101.05 having recovered off an intraday low of Y100.75. The Nikkei came under pressure in opening Tokyo trade on reported offshore hedge fund sales, liquidating stocks and closing out positions in stock index futures, but the bounce back, on domestic investor buys, was just as impressive as the index corrected from a 1.0% loss to up 0.57%. The initial dip had little impact on dollar-yen, but the recovery provided a boost to the rate which spiked it up to a high of Y102.01. However, decent sell interest placed between Y102.00/20 provided a counter which allowed it to pullback to Y101.73 but again the dip attracted demand and allowed rate to extend highs to Y102.06 ahead of the European open. Euro-yen opened Asia around Y130.70, dipped to Y130.54 before pushing up to a high of Y131.83, settling between Y131.70/80 into Europe. Dollar-yen offers remain in place to Y102.20, more on approach to Y102.50. Support Y101.00-100.80 with stops through Y100.80-60.
