Closed in NY Wednesday at $1.3226 (European markets returning today the close Monday was $1.3183), after easing off an extended recovery high if $1.3254. Rate established an early base around $1.3220 in early Asian dealing before edging up to $1.3246 on the back of euro-yen demand (cited for Wednesday’s spike higher in thin markets). The rally met US name supply which allowed it to ease back to $1.3224. Another brief rally to $1.3238 quickly faltered before rate again found support back at $1.3224. Rate was trading around $1.3225/30 into Europe’s return from their Christmas holiday break. Support remains at $1.3225/15, a break of $1.3210 to open a deeper pullback toward $1.3180/70. Resistance remains at $1.3250/60, a break here exposes $1.3280 ahead of stronger interest between $1.3295/1.3310. Continued demand for euro-yen expected to provide buoyancy, Abe the new Japanese PM has voiced that he wants to weaken the yen, while developments in the US ‘Fiscal Cliff’ negotiations bubble away into year end.
EasyForexNews Research Team