EUR – Opened early Europe at $1.3096, Euro-dollar closed in NY at $1.3077 after rate saw another reversal off $1.3100, with rate recovering off a NY afternoon pullback low of $1.3060. A slow start in Asia with early sales eventually able to squeeze rate down to $1.3067 before it picked up fresh demand which took it on to $1.3095. Rate eased to $1.3082 before demand built for another run higher. Rate extended highs to $1.3100 ahead of Europe, eased to $1.3087 into the new session before bouncing through the figure and on to $1.3115. Corrective pullbacks held above $1.3100 before rate was able to extend move to $1.3119. Rate drifted off the high with downside momentum getting a boost on release of weaker than forecast Germany flash manufacturing PMI data. Talk of semi-official sales along with european corp supply acted to take rate below $1.3100 and on to $1.3068 before meeting stronger demand. Recovery efforts faltered around $1.3087. Traders note decent demand in the $1.3070/60 area, more into $1.3040. Resistance $1.3120/30, stops $1.3130/35
GBP – Opened early Europe at $1.6128 and stg0.8120, GBP closed in NY $1.6112 after rate had been pressed to lows in this session of $1.6085 as market reacted to S&P putting the UK outlook on negative from stable (catching up on Moody’s and Fitch). Early Asian dealing saw rate trade between $1.6110/15, marked lows at $1.6105 before attracting fresh buying that took it to an initial high at $1.6123. A brief dip back to $1.6114 before it edged on to session highs at $1.6142, holding firm into early Europe. Euro-sterling saw an extended recovery high of stg0.81205 in NY after the S&P move, eased off to stg0.80125 in early Asia before nudging higher again and was trading firm in Europe, aided by barrier interest in euro-dollar and euro-yen. Cable squeezed back to $1.6113, as the cross edged up to stg0.8129, but managed to recover late morning as the cross eased lower, tracking euro-dollar slippage. The cross dipped under stg0.8100 only to meet decent demand that has lifted it to stg0.8120 ahead of NY, while cable trades around $1.6125.
JPY – Opened in early Europe around Y83.90 and Y109.87, Yen continued to trade with an underlying soft tone through Asia, with dollar-yen able to extend its recovery off Thursday pullback lows of Y83.25, the break above the Y83.75/85 area clearing out barrier interest and tripping stops to take rate on to Y83.96. Japanese demand at the Tokyo fix provided the main upside drive, but decent supply ahead of the next barrier at Y84.00 proved strong enough to counter and allow rate to ease back to Y83.75 into early Europe. The recovery in euro-dollar and the soft yen allowed euro-yen to extend recent gains to Y109.98, just missing out on challenging the barrier at Y110.00. Linked offers ahead countered with rate squeezing lower through the European session to Y109.50/40. Dollar-yen settled back between Y83.65/85 with traders noting decent demand into dips but models counter as they trim longs ahead of the weekend. Elections in Japan on Sunday with forecasts suggesting the LDP may draw enough votes to form a government on their own. Recent LDP comments have been very dovish.
EasyForexNews Research Team