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By XE Market Analysis March 12, 2014 2:24 pm
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    XE Market Analysis: Asia - Mar 12, 2014

    The dollar was mostly lower through the session, though risk off conditions kept pressure on the CAD and AUD, at least through the morning session. EUR-USD reclaimed the 1.39 handle again, though failed to take out Friday's 1.3915 peak. USD-JPY meanwhile, headed to 102.55 lows, on risk aversion, softer equities, and lower Treasury yields. USD-CAD made it up to resistance over 1.1150, though later succumbed to profit taking. There was again no data to move markets, and focus remained on risk levels.

    [EUR, USD]
    EUR-USD popped to 1.3905 highs after breaking through the London high of 1.3874. The pairing will now eye Friday's 1.3915 peak, though congestion was seen between the figure and there. Stops will be a factor over 1.3920. The pairing pulled back to 1.3880, though later posted session highs, touching 1.3913. Dealers reported good two-way action over the figure, though the mix is expected to slant to mostly buyers in an initial move over 1.3920. Real money selling wasn noted over the figure, while intra day players tried to push the topside.

    [USD, JPY]
    USD-JPY dipped to lows near 102.55, and could be vulnerable to further losses, as risk appetite remains soft, and as Treasury yields stay down. Sell stops could be an issue under 102.50, and would set the next target to the March 6 low of 102.28.

    [GBP, USD]
    Sterling remained heavy against the euro after EUR-GBP punched above 0.8350 for the first time this year. The cross has also breached above its 200-day moving average for the first time since last October, which provides another piece of evidence to suggest that the broad rally the pound had seen from mid-last year through to early February can be declared over. Cable earlier logged a one-month low of 1.6568, but recovered the 1.6600 handle on the coattails of EUR-USD's rally and the associated broader weakness of the dollar.

    [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 took out the week's 1.1131 high, which was posted on both Monday and Tuesday, making its way to 1.1153. The soft risk backdrop, along with the drubbing of oil and commodity prices this week weighed further on the CAD this morning. Resistance is seen at 1.1150-60, representing the peaks from February 27 and 28, with stops likely to be a factor above. After failing to break through, it appears some longs yhrew in the towel, resulting in a dip back toward 1.1100. More stops may be in the equation under the figure, but buyers are seen returning into 1.1080.

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