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By XE Market Analysis February 5, 2019 3:13 pm
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    XE Market Analysis: Asia - Feb 05, 2019

    The Dollar firmed in N.Y. on Tuesday, taking the DXY to eight-session highs of 96.11, up from 95.89 lows at the open. The only data was a softer than expected services ISM, though it had little impact on the Greenback. Wall Street rose, while yields edged lower. EUR-USD ranged between 1.1435 and 1.1401, as USD-JPY failed to breach the key 110.00 mark, though found support ahead of 109.80. USD-CAD was a bit higher on another oil market sell-off, while soft UK. data, and technically driven sell took Cable to near 1.2925 lows.

    [EUR, USD]
    EUR-USD printed seven-session lows of 1.1401, coming from 1.1435 highs seen early in the session. Incoming U.S. data has been relatively upbeat for the past week or so, in contrast to EU data, which has largely disappointed. As a result, the Euro should remain under pressure for now, with initial support coming at the January 28 low of 1.1388.

    [USD, JPY]
    USD-JPY has plied a very narrow trading range this morning, peaking at 109.98 early, before slipping to 109.80 lows. Sustained gains over the 110.00 mark have been elusive for over two-weeks now, with ongoing talk of Japanese exporter sellers over the figure. Upside progress this morning has been thwarted by softer Treasury yields, following the minor services ISM miss. USD-JPY resistance remains at Monday's 110.17 highs, with support at 109.44, then 109.20, which is the 20-day moving average.

    [GBP, USD]
    GBP-USD broke under its 200-day moving average (1.3034) in London morning trade, steadying near 1.3000 into the N.Y. open, before hitting sell stops under 1.3000. The pairing later bottomed at 1.2926, a two-week low. U.K. PM May is set to meet the EU's Juncker on Thursday, in hopes of achieving Brexit concessions, however unlikely that may be. Ahead of that meeting, Sterling traders will likely remain on the defensive, with a sell-the-rally mentality in place again.

    [USD, CHF]
    EUR-CHF has settled near the 1.1400 level, holding below last week's 11-week high at 1.1429. The cross has been going through phase of relatively high volatility, which has produced several bouts of pronounced underperformance in the Swiss franc, which have often been accompanied by talk/suspicions of SNB intervention.

    [USD, CAD]
    USD-CAD edged higher in early North American trade, topping at 1.3153 after finding support into 1.3300 overnight. WTI crude prices fell nearly 2% this through the session, dropping under $53.50 from highs of $55.20. USD-CAD's 200-day moving average at 1.3130 will be of interest, with a close under the level keeping the door open for a test of last week's three-month low of 1.3066, should oil prices not stray too much lower, and should overall risk appetite hold up.

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