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By XE Market Analysis April 8, 2019 1:34 pm
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    XE Market Analysis: Asia - Apr 08, 2019

    The Dollar was somewhat softer in N.Y. on Monday, seeing the DXY pullback to 96.99 lows from 97.20. Activity was fairly light overall, with risk taking levels a bit under water through the day. Factory orders were in-line with expectations, and had little impact on the USD. EUR-USD rallied to 1.1274 from 1.1245, while USD-JPY bottomed at 111.29 before later peeking above 111.50. USD-CAD fell as WTI crude traded over $64.00. Cable touched 1.3035 lows, later peaking over 1.3065.

    [EUR, USD]
    EUR-USD printed a nearly two-week highs of 1.1274, up from near 1.1245 at the open, and 1.1212 lows in Asia. A round of short covering has been in the works since last Tuesday's three-week low of 1.1184, though ahead of what will most likely be another ECB announcement and press conference this Wednesday, Euro upside could be limited to the 1.1280 region, where the 20-day moving average resides.

    [USD, JPY]
    USD-JPY remains heavy, falling back under overnight lows of 111.34 early in the session, and down from opening highs near 111.45. Sellers have stepped in as U.S. equity futures add to earlier losses, now indicating a 100 point drop in the Dow at the Wall Street open. The pairing is back below its 200-day moving average of 111.49, and next support comes at the 20-day moving average at 111.06, then the 50-day MA at 110.77. Later, the pairing rallied briefly over 111.50 before settling near 111.45.

    [GBP, USD]
    Cable lifted back above 1.3060 in N.Y. trade, to put in some distance from Friday's 10-day low at 1.2987. UK Prime Minister May is meetings with Labour's Corbyn, amid ongoing efforts to find a cross-party compromise on Brexit. The potential compromise that May and Corbyn appear to be working on is one that would take the form of May's Withdrawal Agreement plus a guarantee the UK would remain in the EU's customs union in the future, which would both satisfy Labour demands while obviating the need for an Irish backstop. If the talks succeed, then the UK would be set to leave on May 22, ahead of European Parliament elections on May 23. If the talks fail, May has committed to putting in a series of Brexit options to Parliament.

    [USD, CHF]
    EUR-CHF rallied to a two-week high at 1.1256, extending the rebound from the eight-month low seen in late March at 1.1162. The rotation high has reflected broader Euro gains, which have bee aided by some above-forecast economic data out of the Eurozone, and increased odds for the UK to be heading to a "soft" version of Brexit. SNB member Maechler said this week that while the Swiss economy remains dynamic and the global economy should remain solid, inflation pressures remain very weak and the environment is fragile, which continues to warrant expansionary monetary policy.

    [USD, CAD]
    USD-CAD was range bound overnight, remaining inside of Friday's trading band, currently on session lows under 1.3365. Another leg higher for oil prices has supported the Loonie, with WTI crude advancing to a five-month peak over $63.50. Later, USD-CAD fell to four-session lows of 1.3313 in early afternoon trade, with the move coming in concert with WTI crude's rally to fresh highs over $64.00. Next support level is the April 3 low of 1.3297, then at the 50-day moving average at 1.3288.

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