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By XE Market Analysis March 24, 2014 3:07 pm
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    XE Market Analysis: Asia - Mar 24, 2014

    The FX market was very quiet to start off the week, with major pairings inside of tight ranges, and volumes on the light side through the morning session. EUR-USD inched to session highs near 1.3790 in early afternoon, though managed to trip stops at 1.3800 and then 1.3845 after putting in a floor around 1.3760 at the open. The move was likely assisted by comments from U.S.'s Kerry, who expressed concern over Russian troops on the Ukraine border. USD-JPY meanwhile, sagged some, basing under 102.15, and down from a N.Y. high of 102.52. Risk-off conditions supported the yen, while talk of pre-fiscal year-end repatriation of yen should limit USD-JPY upside as well. Wall Street traded lower as the tech sector took a hit, while Treasury yields edged lower as well. A softer flash PMI number was not helpful to the risk backdrop either.

    [EUR, USD]
    EUR-USD started the session at 1.3760, and moved slowly higher through the morning from there. Softer flash U.S. PMI data offset the weaker German data earlier in the session, though the euro later tripped stops at 1.3800, and then again at 1.3845. The pairing managed 1.3865 highs, as Wall Street came pared back some of its earlier losses.

    [USD, JPY]
    USD-JPY traded to session lows under 102.15, following Wall Street and Treasury yields lower. The pairing struggled over 102.50 in London, though with bids in place ahead of 102.00, further losses may be slow in coming. Stops are reported at 101.75, and may be in risk in light of reported Japanese yen repatriation into fiscal year end next week.

    [GBP, USD]
    Cable traded between 1.6475 and 16500 in morning trade, though lurched through the 1.65 level on its way to 1.6535 highs in early afternoon. The combination of U.S. secretary of state Kerry warning Russia to pull its troops back from the Ukraine border, and a partial recovery on Wall Street helped sterling.

    [USD, CHF]
    USD-CHF and EUR-CHF were both trending lower through the morning, as risk appetite turned lower. Later, as U.S. secretary of state Kerry warmed Russia about its troops on the Ukraine border, the dollar pairing was pushed to lows of 0.8787, down from session highs over 0.8865. The cross held up fairly well, but was unable to breach the 1.2200 mark.

    [USD, CAD]
    USD-CAD eased under 1.1205 on the back of firmer equities early in the session, though as stocks turned lower, and bids noted into 1.1200, downside follow through was stopped in its tracks. From there, the pairing made its way over 1.1225 in very light trade, though a partial stock market recovery saw USD-CAD head back under 1.1200, to 1.1184 lows. Bigger picture, the combination of a more dovish sounding BoC, and more hawkish Fed, should keep USD-CAD in buy-the-dip mode.

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