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By XE Market Analysis December 24, 2019 11:17 am
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    XE Market Analysis: Asia - Dec 24, 2019

    The FX market was virtually closed on Tuesday in N.Y., with traders sitting on their hands into the early close for many, and ahead of Christmas on Wednesday. The only data release was the December Richmond Fed index, which fell to -5 from -1, but had little market impact. EUR-USD ranged between 1.1078 and 1.1090, while USD-JPY idled between 109.33 and 109.44. USD-CAD eased from 1.3164 to 1.3147, while Cable steadied on either side of 1.2950.

    [EUR, USD]
    EUR-USD traded a 14-point range in N.Y. time on Tuesday, basing at 1.1076, later hitting highs of 1.1089 in extremely light pre-holiday trade. "Sideways" will be the takeaway into the end of the year, though looking forward, we expect the dollar to remain firm in 2020, with the U.S. economy expected to hold up and with the Trump administration having incentive to be cooperative on the trade front into the November presidential election. EUR-USD losses may be limited however, as the ECB's easing program has about seen its limits, and as the European economy looks to be past its soft patch seen from earlier in the year.

    [USD, JPY]
    USD-JPY managed a 109.33 to 109.44 trading range since the N.Y. close on Monday, which appears to be the narrowest intra day band of 2019. All major Forex centers but Tokyo will be closed for Christmas on Wednesday, and further sideways price action can be expected, not just Wednesday, but likely through the first Monday in January.

    [GBP, USD]
    Cable was relatively steady on Tuesday, edging up from London lows of 1.2923, to 1.2964 highs into the N.Y. open. The U.S. session saw price action limited to 1.2960 to 1.2945. A close under 1.2960, the 50-day moving average, will mark the second consecutive close under the level. London will be closed Wednesday and Thursday for Christmas and Boxing Day.

    [USD, CHF]
    EUR-CHF recovered from near three-month lows of 1.0861 seen ahead of the N.Y. open on Monday, later topping at 1.0898. The recovery came as EUR-USD rallied modestly, resulting in a short squeeze from oversold levels. Progess on Brexit and on trade should limit the cross's downside for now.

    [USD, CAD]
    USD-CAD is in a holding pattern on Tuesday, as all other major pairings are, ranging between 1.3141 after Monday's close, and 1.3169 into the North American open. USD-CAD touched 1.3147 later in the session.More of the same would appear to be in the cards. The Canadian economic calendar is now completely empty until January 6. In the meantime, the 1.3100 to 1.3200 trading band seen for nearly two-weeks should hold into the New Year.

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