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By XE Market Analysis March 11, 2014 2:53 pm
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    XE Market Analysis: Asia - Mar 11, 2014

    FX trade was again relatively quiet in N.Y. on Tuesday, with a lack of first tier data limiting directional cues. Wholesale sales data were softer than expected, though this data series rarely has much impact on the dollar. Major USD pairings were held inside famililar and narrow ranges, though overall, the greenback lost some ground. EUR-USD moved briefly under 1.3835 before touching highs over 103870, while USD-JPY slipped under 103.00 on the back of weaker U.S. equities. Chilly diplomacy between the U.S. and Russia concerning the Ukraine may have kept stocks, and yields down through the session, likely weighing on the dollar generally.

    [EUR, USD]
    EUR-USD found buyers under 1.3835 into the N.Y. open, and pulled back up near 1.3860 by mid-morning. Light stops were reported at 1.3825, though were never really in danger. The euro later peaked near 1.3875, though it appears the recent rally may be running out of steam. Key will be holding the 1.3800 mark, where a break there may result in a filling in of the post-U.S. jobs report gap up from 1.3720.

    [USD, JPY]
    USD-JPY posted intra day lows of 102.94, after touching 103.34 highs early in the session. The modest downdraft came as Wall Street turned negative on the day, though bidding interest was seen again under the 103.00 level. The pairing bounced to 103.12 highs from there, though struggled to gain altitude in light of the softer afternoon risk backdrop.

    [GBP, USD]
    Cable slipped under 1.66 into the N.Y. open, but found good support from there, recovering over 1.6645 into the London close. BoE Governor Carney reaffirmed dovish stance during parliamentary testimony of MPC members. Carney argued that the CPI outlook has become increasing benign, and that inflation expectations remain anchored. He repeated that policy normalization would start with interest rate rises before QE assets are sold.

    [USD, CHF]
    EUR-CHF drifted back under 1.2200 in recent sessions as geopolitical risk remains over the Ukraine, which is returning support to the safe haven franc. This leaves the rebound high at 1.2214, though there remains some distance from the fresh cycle low of 1.2104 that was seen on Monday, which is the lowest level seen since June last year.

    [USD, CAD]
    USD-CAD peaked at 1.1131 in London trade, matching the previous day's high, and up from the 1.1100 area at the North American close. Solid offers remained in place from 1.1130, with investment funds the sellers of note. The risk backdrop was fairly neutral this morning, and steadying oil prices, and firmer gold supported the CAD to a degree. USD-CAD tripped light stops at 1.1095 on its way to intra day lows of 1.1072. Activity overall was light, and standing bids noted at 1.1070-50 effectively put a floor under the pairing.

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