EUR – Opened early Europe at $1.3058, Euro-dollar closed in NY at $1.3072 after easing away from a late recovery high of $1.3090, the rate giving back most of its recovery gains from early NY lows of $1.3060 into the close. Rate extended its recovery off late NY pullback lows of $1.3064, edging to $1.3077 in Asia before meeting decent supply from a Swiss name. Early interest to target stops above $1.3085 caught short term specs long and added momentum to the reversal off highs, the break below $1.3060 taking it down to $1.3045. Decent demand was encountered into $1.3050/45 area which cushioned the move. Recovery was capped at broken support of $1.3060, before it settled between $1.3050/60 into Europe. Rate pressed lower in early Europe, extending lows to $1.3042 before it met strong middle eastern demand which reversed the move. Break above $1.3060 accelerated it on to retest the Asian high before topping out at $1.3082. Rate was holding firm as attention turns to the ECB rate decision and press conference at 1245/1330GMT respectively. Stops noted above $1.3085.
GBP – Opened early Europe at $1.6090 and stg0.8115, GBP closed in NY at $1.6090, after seeing pullback lows of $1.6080 post Chancellor Osborne’s Autumn Statement, with strong demand into that low keeping the rate buoyed through the session. Rate had seen a recovery high of $1.6109 before squeezing lower into the close. Cable recovered in early Asia, making a brief show at $1.6101 before turning lower, marking overnight lows at $1.6087 before settling around $1.6090 into Europe. Euro-sterling was contained through Asia between stg0.8109/23 as it consolidated Wednesday’s pullback from stg0.8147 to stg0.8112. Cable tracked the early downside pressure on euro-dollar, easing back toward the $1.6080 level, touching $1.6079 before bouncing back as both rates saw strong middle eastern demand. Cable rallied through the overnight high, posting a high at $1.6117 before settling around $1.6110. Release of a wider trade deficit in the UK had little detrimental effect. Attention now turns to the BOE rate decision at 1200GMT, though most expect no change in rates/QE.
JPY – Opened in early Europe at Y82.48 and Y107.70 Initial sales in Asia pressed dollar-yen to Y82.36, but strong demand from a US name in Tokyo provided a solid base before the rate began to recover, with upside momentum aided by positive moves in the Nikkei. Real money demand triggered stops above Y82.50 and the rate extended gains to Y82.62, before late profit take sales eased to Y82.40. Euro-yen opened heavy and slipped to Y107.46 through the Tokyo fix, dip demand bounced and aided by euro-dollar’s extended recovery printed highs of Y107.83, later easing to Y107.60. Dollar-yen trade was tied to a narrow European range and lifted off early lows of Y82.38 on sharp cross demand. Euro-yen bounced off early lows of Y107.48 and extended gains on Middle-Eastern demand to Y107.89, but once again met strong resistance ahead of the Y108.00 option barrier. Late profit take sales pared light gains to Y107.70 ahead of NY, dollar tracked the move and extended the corrective pullback to Y82.37.
EasyForexNews Research Team