Closed in NY at $1.3316 after rate had been held through Monday trade in a range of $1.3300-1.3330/35. Rate came under pressure in early Asia with sales of euro-Aussie cited for the move. Bids at $1.3300 again cushioned the base, the rate showing a low of $1.3301 (although there is talk that $1.3297 was given but while rate was $1.3306 bid) before recovering. The rate edged to $1.3315 before the BOJ monetary policy announcement sparked strong demand as traders reacted to the much expected 2.0% inflation target, though of note that there was no mention of a time frame. Euro-dollar spiked through resistance at $1.3330/35, with triggered stops above $1.3340 taking the rate on to highs of $1.3358 before momentum faded. Rate eased back to $1.3334 before settling above $1.3340 ahead of the European open. Yen pairs have been a lot more volatile as traders analyze the BOJ comments. Euro-dollar offers remain in place toward $1.3360, with stops noted between $1.3365/75. A break here brings key resistance at $1.3400/05 back into view. Support $1.3300, $1.3285/80 with stops below. Ger many ZEW at 1000GMT to provide the morning focus. US calendar fairly light, though existing home sales at 1500GMT will be watched.
EasyForexNews Research Team