EUR – Closed in NY Friday at $1.3005 after rate had been shoved to lows of $1.2955 on reaction to the strong NFP data. Rate recovered to $1.3017 before drifting off again into the close. Rate consolidated Friday’s volatile reaction in Asia, early trade was contained within a range of $1.2985/1.3005 before it dipped to $1.2980 ahead of the Tokyo open then edged slightly higher on euro-yen demand to trade within $1.2995/1.3010 through to the Europe open. Early Russian demand into Europe extended the recovery to $1.3025 before reported offers placed between $1.3020/30 countered. Rate eased off to $1.2993 before settling around $1.3000. Traders have noted that the $1.3000 level holds the strike of an expiring option at the NY cut 1000ET/1400GMT (note NY time change). A fairly subdued European session, most reports suggest looking to fade rallies to $1.3040/50, looking for an eventual break of $1.2550 barriers to trigger stops. US data calendar very light.
GBP – Closed in NY Friday at $1.4925 after rate had been shoved to fresh 2013 lows of $1.4885 on reaction to the release of strong NFP data. Rate had managed to recover to $1.4959 before it drifted off into the close. Rate slowly squeezed lower in Asia, touching a low of $1.4901, but demand placed into $1.4900 managed to cushion and allow rate to lift back and settle between $1.4915/30 through the mid part of the Asian day. Late demand into Europe extended this recovery to $1.4936. Demand continued into Europe allowing rate to edge on to $1.4945, but offers placed toward $1.4950 countered the move. Rate eased back toward overnight lows late Europe morning, and was looking to retest the strength of those mentioned bids into $1.4900. Further offers noted at $1.4960/65, a break here to open a move back toward $1.4980 ahead of $1.5000/10. Support remains at $1.4900 ahead of $1.4885/80 and $1.4855/50. Euro-sterling had been driven to extended highs of stg0.8743 post NFP release before dropping back to stg0.8676, closing Friday’s session at stg0.8710. Rate in Asia consolidated these volatile moves with trade contained within a range of stg0.8697-0.8718. The cross eased to stg0.8703 in early Europe before pushing up to stg0.8725 late morning.
JPY – Dollar-yen saw extended highs of Y96.55 on its initial reaction to the strong NFP release Friday but sank back to Y95.50 before lifting back above Y96.00 into the close. Similar moves for euro-yen which had seen highs of Y125.92, dropped to Y123.81 before closing the week at Y124.86. Yen continued to trade with an underlying soft tone, aided in part by BOJ Governor nominee Kuroda comments suggesting stronger efforts to get inflation to 2.0%. Dollar-yen dipped under Y96.00 in Asia only to meet willing buyers which cushioned the move and allowed it to edge up to Y96.26, but offers between Y96.20/30 restricted upside progress. Traders report that institutional investors have scattered demand interest below Y96.00, the interest said to be for UST purchase. Offers seen from around Y96.25 through to Y96.40 with talk of stops placed from Y96.45 and extending to Y96.65. Early Tokyo demand for euro-yen edged this rate to an eventual high of Y125.18, settling around Y125.00 into Europe. Cross offers seen into Y125.20, stronger between Y125.40/50 and between Y125.90/00. Europe continued the overnight subdued trading, markets awaiting the opening of the NY markets to trigger some yield related action.
EasyForexNews Research Team