Negative comments on the Fiscal Cliff negotiations Thursday acted to drop dollar-yen back from Y86.15 to Y85.75, but House Speaker Boehner calling Republicans to a meeting Sunday boosted hopes into the NY close and took rate back to Y86.12. Euro-yen had seen highs of Y114.32, dropping to Y113.41 before closing back at Y114.01. Strong demand for both pairs into the Asian session, with position adjustments seen ahead of next week’s Japanese holidays (Dec31 to Jan3)cited for a major part of the interest, took dollar-yen on to fresh recovery highs of Y86.64, euro-yen to Y114.70. After the initial exuberance dollar-yen settled between Y86.35/50 and euro-yen between Y114.35/55, though the underlying tone remains buoyant but open to Fiscal Cliff comment, as was seen Thursday. Technical traders refer to the 200-week moving average in euro-yen at Y114.99 which is seen strengthening resistance into Y115.00. This level is said to hold option barrier interest and expected to also draw protective selling ahead.
EasyForexNews Research Team