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By XE Market Analysis February 15, 2019 2:27 pm
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    XE Market Analysis: Asia - Feb 15, 2019

    The Dollar index pulled back from near one-month highs in N.Y. on Friday, dipping just under 97.00, after peaking at 97.37 early in the session. Pre-weekend profit taking was a driver, coming as the U.S. and China extended trade talks through next week in Washington. The news reversed some of the Greenback's safe-haven flows seen earlier in the week. EUR-USD topped over 1.1290 from 1.1235 lows, while USD-JPY peaked at 110.64 before dipping to 110.39 lows. USD-CAD dipped to 1.3255 as oil prices rallied. Cable meanwhile, topped over 1.2880.

    [EUR, USD]
    EUR-USD printed new three-month lows of 1.1235 early in the session, before rallying to 1.1285 highs. The pairing was unable to crack the 1.13 handle overnight, marking the first time this week to remain on the 1.12 handle. Sell-the-rally remains in place, as while the U.S. economy may be slowing some, the EU remains on a much weaker track.

    [USD, JPY]
    USD-JPY peaked at 110.64 in the aftermath of the firmer Empire State index, and despite the soggy trade price figures. Gains were short lived however, as traders took advantage of the intra day highs to book profits into the weekend. The pairing bottomed at 110.39, since climbing back over the 110.50 mark.

    [GBP, USD]
    Cable has lifted firmly back above 1.2875 following the post-U.S. data dip to 1.2788. The intraday low that was seen during the early part of the London interbank session, at 1.2784, was left unchallenged. Market participants are both weary and wary about Brexit. There has been little sign that Brussels will give the UK government the concession it wants on the Irish backstop. Nor has there been any inkling that the divided parties in parliament will be able to ham out a compromised deal. UK Prime Minister May's humiliating defeat in the House of Commons Thursday, in a motion that was meant to endorse the government's negotiating strategy, doesn't have legal relevance, but has eroded her authority, which some political pundits suggest has defanged her tactic to pressure support for her deal or risk an exit from the EU without a deal.

    [USD, CHF]
    EUR-CHF is down for a third consecutive day, posting a three-day low at 1.1331, extending a decline from the five-day high that was seen Tuesday at 1.1406. The three-month high seen on February 5, at 1.1443, was left untroubled by the recent advance. The price action has continued a phase of relatively high volatility that the cross has been experiencing. Since early January there have been several bouts of pronounced under performance in the Swiss franc, often accompanied by talk/suspicions of SNB intervention.

    [USD, CAD]
    USD-CAD bottomed at 1.3255, after peaking at 1.3317 during the overnight Asian session. WTI crude topped at two-week highs over $55.70, while risk-on conditions prevailed today, both weighing the pairing down. Support remains at 1.3243, the 20-day moving average, with resistance up at 1.3351, the 50-day moving average.

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