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By XE Market Analysis April 22, 2015 2:47 pm
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    XE Market Analysis: Asia - Apr 22, 2015

    After falling overnight, the dollar found its footing in N.Y. trade on Wednesday, moving higher versus most major currencies, as yields moved up, and as risk appetite remained supportive. Better existing home sales, and firmer housing prices helped Wall Street, and led to a EUR-USD sell off to 1.0709 lows, after the pairing ran into a barrage of sellers at 1.0800 in London. USD-JPY rallied over 119.90, where it ran into resistance from a reported layer of Japan exporter offers from 120.00. USD-CAD meanwhile, maintained support over its 100-day moving average of 1.2222. Cable held its own following more hawkish MPC minutes, maintaining the 1.5000 handle throughout the session.

    [EUR, USD]
    EUR-USD fell from N.Y. highs near 1.0770 to a low of 1.0709. The pairing recovered over 1.0730 in subsequent dealings, before turning sideways. Despite the less dire Greek sentiment today, the market found the euro's atmosphere a bit thin at 1.0800, and a variety of sellers were noted into the level. Real money, along with option backed, and reserve manager accounts were all reportedly active on the offer. It would appear for now, that a break of either 1.0650 or 1.0850 will be needed to shift EUR-USD out of recent range trade mentality.

    [USD, JPY]
    USD-JPY put in its third consecutive higher daily high, peaking at 119.96. Reports of Japanese exporter offers from the 120.00 mark have been heard, which have so far kept the figure out of range. With U.S. yields firmer, and risk appetite supportive, downside may be limited from here. The April 14 peak of 120.12 is the next upside target, and should be easy to attain, with buy-stops reported at 120.05.

    [GBP, USD]
    Sterling rallied on the MPC minutes, which noted that all members agreed that a repo rate hike was more likely than not over the three-year forecast period. Cable peaked at 1.5079 in early N.Y. trade, levels last seen on March 18. The pairing pulled back some on general USD strength, though managed to hold the 1.50 handle into the close.

    [USD, CHF]
    EUR-CHF rallied to an eight session high of 1.0394 in N.Y. trade on Wednesday. The move came after the SNB said it would reduce the number of institutions exempt from negative interest rates on sight deposits. USD-CHF rallied nearly 200 points to just under 0.9700. The SNB move likely opens the door for more negative rates in the near future, perhaps to offset a potential Greece EMU exit.

    [USD, CAD]
    USD-CAD bounced from its 1.2211 lows, later trading to a high of 1.2269. The 100-day moving average, currently at 1.2222, continued to put a floor under the pairing, while the dip in oil prices limited downside as well. WTI crude rallied later on not as high as feared EIA oil inventory data, which sent USD-CAD back under 1.2230. Overall, range trade looks likely over the next session or two.

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