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By XE Market Analysis February 8, 2019 1:47 pm
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    XE Market Analysis: Asia - Feb 08, 2019

    The Dollar faded into the N.Y. open on Friday in N.Y., though found a footing, rallying modestly into the London close. There was no data to drive the market, though trade concerns weighed on Wall Street and Treasury yields again. The DXY topped at 96.64 from 96.45 lows. EUR-USD opened at 1.1352, later making its way to 1.1322 lows. USD-JPY was rangebound between 109.88 and 109.67. USD-CAD fell to 1.3220 from 1.330 on a better Canada jobs report, though later recovered to 1.3295. Cable meanwhile, opened near 1.2975, later falling into 1.2930.

    [EUR, USD]
    EUR-USD has printed six consecutive sessions of lower daily highs and lows going into the weekend. The pairing found some early short covering driven buyers early on, though the Euro is now back testing the London two-plus week low of 1.1322. Slowing EU growth will likely keep the Euro under pressure for the foreseeable future.

    [USD, JPY]
    USD-JPY has turned sideways, managing just a 109.69 to a 109.90 range since Thursday's N.Y. close. The pairing has held up well considering the risk-off backdrop seen over the past two sessions. Japan sovereign yields touched two-year lows overnight, which has likely been supportive of the pairing, though the 110.00 mark has remained a tough nut to crack, failing to hold the level for nearly a month.

    [GBP, USD]
    Cable has remained buoyant but below Thursday's high, which was printed at 1.2996 following a 1% surge after BoE Governor Carney had effectively walked back the dovish undertones of the central bank's guidance, stating that while Brexit-related uncertainty has risen, the overall outlook was still good, especially if a no-deal scenario is avoided. The pound is still trading at about a 13%-14% discount in trade-weighted terms relative to levels prevailing ahead of the vote to leave the EU in June 2016. Cable has resistance at 1.2996-1.3000, and support at 1.2916-20.

    [USD, CHF]
    EUR-CHF sank to nine-day lows under 1.1325, with the cross tipping lower by the force of broad declines in the Euro as incoming data continue to painting a picture of a stagnating Eurozone economy. Earlier in the week the cross had spiked to a three-month high at 1.1443. The price action continues a phase of relatively high volatility the cross has been experiencing. Since early January there have been several bouts of pronounced underperformance in the Swiss franc, often accompanied by talk/suspicions of SNB intervention.

    [USD, CAD]
    USD-CAD slid to 1.3220 from the 1.3300 level following the Canada employment report, where new jobs were significantly higher than expected, though the unemployment rate rose more than forecast. Support at Thursday's low of 1.3213 put a floor under the pairing, as it later rallied to 1.3296 highs as WTI crude prices retreated toward $52.00.

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