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By XE Market Analysis February 21, 2014 2:05 pm
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    XE Market Analysis: Asia - Feb 21, 2014

    The dollar was mixed in N.Y. trade on Friday, ultimately losing ground to the euro and CAD, while rallying versus the yen and sterling. Buy stops at 1.3720-25 helped propel EUR-USD to highs near 1.3760, while warmer Canadian CPI supported the loonie. Cable ran out of steam over 1.6700, running into good sellers over the figure, before retreating under 1.6625. On the economic front, just existing home sales were on tap, which were weaker than expected, but partially due to bad weather. Equities managed modest gains, while Treasury yields were a touch softer.

    [EUR, USD]
    EUR-USD led the dollar's charge lower ahead of the data, as the pairing took out noted stops at 1.3720-25. This resulted in a run up to 1.3740 initially, and to 1.3758 session highs after the housing data. Offers are seen in place from 1.3770 up to 1.3800, which has been a difficult level for some time. After trading down to 1.3720 into the London close, the euro stabilized over 1.3730.

    [USD, JPY]
    USD-JPY moved over 102.80 in early trade, after opening near 102.50. This level has put a ceiling on the pairing for most of February, and a decisive break over 102.80 should result in a run to 103.00 initially, and 103.40-50 after that. The pairing fell back under 102.60 after weaker U.S. housing data, though regain upside momentum in light afternoon trade.

    [GBP, USD]
    Cable rebounded back to near 1.6725 after making a eight-day low of 1.6612 following the sub-forecast retail sales figure out of the U.K., which came in at -1.5% m/m. The dollar later perked up again versus the pound though, as cable found good sellers over 1.6700, and later fell back to match the 1.6612 London low in whippy trade. U.K. names were reportedly active sellers on the way down.

    [USD, CHF]
    EUR-CHF traversed a narrow range on either side of 1.2200 on Friday. Modestly better risk levels provided some support, though the market this week has not been keen to push the downside envelope too hard, goven the nearby steady gaze from the SNB.

    [USD, CAD]
    USD-CAD initially jumped to 1.1194 highs after the Canadian data, though quickly eased back toward 1.1145. The weaker than expected retail sales appeared to have been behind the initial bounce, though hotter than forecast headline and core inflation more than offset. Barriers at 1.1200 remain safe for now, and Friday profit taking took hold after a week of steep USD-CAD gains. sending USD-CAD to afternoon lows near 1.1110.

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