EUR: Opened early Europe at $1.2788, Euro-dollar closed in NY at $1.2796 after recovering from an intraday low of $1.2767, but below its 200-dma at $1.2830 (today coming in at $1.2828 and offering key resistance). The rate’s recovery extended to $1.2803 in early Asian trade before reversing down to lows of $1.2782. Recovery was aided as the Australian dollar was boosted on the back of RBA’s no rate change (25bp cut widely expected). Euro-dollar edged toward $1.2800 but failed to break above, settling between $1.2784/94 ahead of the European open. Early demand into Europe took rate to $1.2802 before fresh sellers emerged to pressure rate back below the figure. Rate found initial support at $1.2770 before extending move to $1.2764 where it met stronger demand. Asian demand for euro-yen was initially cited for the recovery off lows, with east European buying (MICEX mentioned) luinked to the move back above $1.2800 late morning. Rate touched a recovery high at $1.2808, well shy of retesting that 200-dma. Release of services/composite PMi data had little effect.
GBP: Opened early Europe at $1.5985 and stg0.8000, GBP closed in NY at $1.5979 after it had recovered off intraday lows of $1.5957, seen after the pound came under pressure following release of softer than forecast services PMI data. Rate extended the recovery into early Asia, in tandem with euro-dollar’s early climb, edging to an initial high of $1.5985. Rate eased to $1.5971, again taking its lead from euro-dollar, as well as reacting to the release of disappointing UK BRC retail sales data. Recovery off lows was given an added boost as risk in general was lifted by the Australian dollar spiking higher on the back of the RBA leaving rates unchanged (-25bp expected). Cable rallied to a high of $1.5992 and was holding firm into early Europe. Euro-sterling was held within stg0.7996-0.8001 through Asia. Sterling picked up an early bid tone as euro-sterling was pressed down to stg0.7984 on Swiss name sales, the move took cable to $1.5998 but failed to move back above the figure. Weak UK IP/Mfg data weighed back on the pound, taking the cross up to stg0.8013, cable to $1.5963.
JPY: Opened in early Europe at Y80.04 and Y102.41, Dollar-yen opened in Asia at Y80.25 and slipped in early trade to Y80.13, before the rate recovered to settle in a tight range. The pair later ground to Y80.10 on broad dollar weakness following RBA’s surprise decision to leave interest rates on hold. Supply from Japanese banks added weight and dollar pressed to Y79.96 as traders squared positions ahead of the US elections. Euro-yen opened at Y102.65 and slipped to post RBA reaction lows of Y102.26 with trade volumes seen light. Dollar-yen bounced off intraday lows in early Europe to Y80.05 and lifted in tandem with euro-dollar’s extended recovery to Y80.27, later easing on profit take sales. The Asian high seen capping moves at Y80.30 on the topside, ahead of Y80.34/38 (25 & 26 Oct highs). Euro-yen recovered to Y102.50 in light European trade, demand from a respected Asian name extended to Y102.80, before easing to Y102.65 ahead of NY. Tech resistance seen at Y102.85 (21 dma), ahead of offers at Y103.00.
EasyForexNews Research Team