EUR: Opened early Europe at $1.2864, Euro-dollar closed in NY at $1.2865, the corrective pullback from session highs of $1.2913 given added weight by the late downgrade of Spain by S&P which saw it trade to $1.2862. Rate saw fresh supply into Asia, as markets continued to react to the S&P move. Rate met initial support at the $1.2840 level before recovering to $1.2860 only to get knocked lower as markets reacted to the release of Australian jobs data, prompting further euro-Aussie long unwinds. Rate triggered stops below $1.2840, extending lows to $1.2826 before basing, traders aware of support linked to the 200-dma at $1.2823 (support seen down to $1.2800, covering Oct1 low at $1.2804). Rate recovered to $1.2877 into early Europe only to get repulsed again ahead of $1.2880. Asian sales squeezed rate to $1.2844 before it met strong demand which cushioned then reversed the early easing. Mid east and eastern Europe buys drove rate to a fresh high of $1.2892 (76.4% $1.2913-1.2826) with rate holding firm in late European morning trade.
GBP: Opened early Europe at $1.6013 and stg0.8034, GBP closed in NY at $1.6000, the rate having pulled back from session highs at $1.6035 as it tracked euro-dollar slippage, with move provided with some buoyancy as euro-sterling eased off recovery highs at stg0.8061 to stg0.8039. The late S&P downgrading of Spain prompted further euro sales, supply taking the cross to extended lows of stg0.8023, allowing cable to survive an early dip to $1.5993 before it bounced to $1.6013. The deeper move in euro-dollar, following release of Australian jobs data which prompted strong demand for Aussie across the board, saw cable extend lows to $1.5985 before it recovered to $1.6025. Corrective pullback met support at $1.6013 before settling around $1.6015 into Europe. Asian sales of euro-dollar saw cable track euro-dollar lower, dipping to $1.5998 before meeting strong demand that bounced rate to an extended high of $1.6028. the recovery tracked euro-dollar, though move was tempered as euro-sterling recovered off its extended lows of stg0.8023 to stg0.8045.
JPY: Opened in early Europe at Y78.01 and Y100.31, Dollar-yen opened in Asia at Y78.18 and the pair ground lower as Asian markets digested the Spanish downgrade from ratings agency S&P. Cross sales added weight and extended losses through Y78.00, flushing stops to print Y77.95 ahead of Europe. Heavy supply from leveraged names/real money pressed euro-yen to Y100.28 in early Asia, sliding to Y100.15 through the Tokyo fix. Dip demand recovered and the pair settled around Y100.45, before heading lower again on release of Australian jobs data. Stops flushed in dollar-yen extended losses to Y100.15 and a re-test of intraday lows. Demand on the European open lifted dollar-yen to Y78.13 where the rate stalled and ran into strong supply from a Japanese bank. The pair headed lower and briefly dipped under Y78.00, before bouncing to settle around Y78.10. Euro-yen ground higher throughout a quiet session, initially bouncing off intraday lows and extending to Y100.50. The cross tracked euro-dollar to print highs of Y100.73 and remains buoyant ahead of NY.
EasyForexNews Research Team