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By XE Market Analysis April 10, 2014 2:25 pm
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    XE Market Analysis: Asia - Apr 10, 2014

    The dollar was mixed in N.Y. trade on Thursday, losing ground to the euro, yen and CHF, holding steady against sterling, and posting modest gains versus the CAD. Jobless claims data were the lowest in years, while import prices crept up in March. The tech heavy NASDAQ dragged Wall Street sharply lower, with the major indices giving up all of Wednesday's post-FOMC minute gains. EUR-USD stopped just under 1.3900, while USD-JPY edged under 101.40. USD-CAD rallied over 109.20, after holding support into 1.0850 overnight.

    [EUR, USD]
    EUR-USD touched 1.3899 highs before reverting back to 1.3880. Option backed selling was reported ahead of the figure, with London names seen with the interest. Real money offers were noted as well, though stops are said to be in place over 1.3910 now. While the pairing failed to breach 1.3900, the shallow pullback could indeed be a sigh the euro has more room to run to the upside.

    [USD, JPY]
    USD-JPY tested 102 early, though failed miserably, and headed back toward 101.60. Light stops were noted under 101.60, which brought intra day lows of 101.43 back into focus. The pairing later based at 101.33, above support seen at 101.20-00. Large stops are reportedly just under 101.00 now, which if broken would see the 2014 low of 100.75 targeted. The poor risk backdrop continued to weigh on the pairing, and previous 102.00 offers are now said to be moving down to 101.80.

    [GBP, USD]
    Cable extended to a fresh high of 1.6820 during the Asia session today following the release of the RICS house price balance for March, which was much stronger than expected with a headline balance of +57%, up from 47% in the prior month. This followed official U.K. production data earlier in the week that had smashed expectations and led to upward tweaks in Q1 GDP forecasts. The high in Cable stalled a couple of pips shy of the Feb-17 major-trend peak at 1.6822, and headed back to 1.6755 lows in N.Y. trade.

    [USD, CHF]
    EUR-CHF has settled back below 1.2200 again, after making a two-month high of 1.2249 last Friday. The recent up-move reflected an unwinding of the Swiss franc's safe-haven premium, though lower stock markets, persisting geopolitical concerns with Russia, and weak China trade data have reversed this. The cycle low of 1.2104 is a key support, while below 1.2100 the risk of SNB intervention would ratchet up.

    [USD, CAD]
    USD-CAD held 1.0850 support overnight, and later rallied back to 109.24 highs. Corporate backed buying was reportedly a feature overnight, while general USD-CAD short covering was noted in light of the fairly sharp downward movement seen this week. In addition, a poor risk backdrop weighed on the CAD. Initial resistance is seen at 1.0940.

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