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By XE Market Analysis May 1, 2018 3:48 pm
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    XE Market Analysis: Asia - May 01, 2018

    The DXY rallied to near highs if the year, topping at 92.55, as the dollar rallied broadly against major currencies. Incoming U.S. data disappointed, though the greenback advanced nonetheless. EUR-USD fell to 1.1982, as USD-JPY topped at 109.80. USD-CAD dipped initially on firmer Canada GDP figures, though later rallied as oil prices fell. Cable remained under pressure, falling to 1.3588 lows.

    [EUR, USD]
    EUR-USD crossed under its 200-day moving average of 1.2014 today for the first time since April of last year, bottoming at 1.1982, levels last seen on January 11. General dollar strength has been the main driver, while expectations for strong U.S. jobs data on Friday have been maintaining a bid for dollars, as did yesterday's sub-forecast German retail sales outcome, which maintained the economy-slowing narrative in the Eurozone.

    [USD, JPY]
    USD-JPY topped at near three-month highs of 109.80, as the dollar overall pushes higher on the back of yield advantage, and slim chances of any policy tightening from the likes of the BoJ, ECB and BoE, even as the Fed preps for further rate hikes this year (though not tomorrow). Japanese exporter offers are rumored to be in place from the 110.00 psych level, and above there, the 200-day moving average at 110.24 will attract attention.

    [GBP, USD]
    Cable was down over 1.0%, printing a new 4-month low at 1.3588. The pairing is registering the biggest move on the day out of the currencies we keep tabs on, with the pound the weakest and the dollar the biggest gainer. The year's low at 1.3457, seen on January 11th, provides the next downside target.

    [USD, CHF]
    EUR-CHF has entered a consolidative phase after making a 39-month high at 1.2005. The cross ebbed to a seven-session low at 1.1926 this week before finding a footing, subsequently rebounding to the upper 1.1900s. The franc's return to the 1.2000 level was symbolic "normalisation" that's been afoot in global markets, being the first time the currency has traded below the SNB's former trading cap, which it abandoned in January 2015 in the face of broad and unstoppable euro depreciation caused by ECB monetary stimulus. EUR-CHF is some 12% higher from the levels of mid last year.

    [USD, CAD]
    USD-CAD fell to 1.2833 lows from 1.2880 in the aftermath of the better Canada February GDP data, though since rallied to nearly one-month highs of 1.2914. Weaker oil prices, and a generally stronger USD have provided support. The pairing bounced from its 50-day moving average of 1.2819 overnight, and remains in buy-mode on dips toward the bottom of its better than one-week range floor.

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