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By XE Market Analysis November 12, 2019 2:13 pm
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    XE Market Analysis: Asia - Nov 12, 2019

    The DXY printed near one-month highs of 98.42 in morning N.Y. trade on Tuesday, later fading to 98.27 lows. There was no data to drive the FX market, though as Treasury yields pulled back some, the Dollar turned slightly lower. EUR-USD managed to print fresh trend lows of 1.1003, while USD-JPY was range bound over its 200-day moving average at 109.02. USD-CAD eased to 1.3216 on profit taking, after hitting a one-month high. Cable meanwhile, recovered to near 1.2975, up from opening lows near 1.2830. Traders will look ahead to U.S. CPI data on Wednesday, along with a speech from Fed chair Powell.

    [EUR, USD]
    EUR-USD fell to near one-month lows of 1.1003 into the London close, coming from overnight highs of 1.1038. The pairing has printed six consecutive sessions of lower daily highs, and is set to close under its 50-day moving average of 1.1041 for the third straight day, both bearish developments for the Euro. The U.S. economy continues to outpace the Eurozone economy, which, along with the Dollar's yield advantage, should keep the pressure on Eur-USD. The October 15 low of 1.0991 is the next downside target.

    [USD, JPY]
    USD-JPY recovered briefly from early session lows of 109.06, with buyers stepping in ahead of the 200-day moving average at 109.02. A modest Wall Street rally allowed the risk-sensitive pairing to trade above the 109.20 level, though as Wall Street faded, the pairing printed 109.02 lows. Trump's speech to the ECONY revealed little in the way of positive slant to the U.S./China trade picture, which likely supported the Yen to a degree.

    [GBP, USD]
    The Pound vaulted higher Monday, peaking at 1.2898, on news that the Brexit Party decided not to contest PM Johnson's Conservative Party in the 317 seats they won at the previous general election in 2017. This will greatly reduce the risk of splitting the pro-Brexit vote at the December-12 election. The Brexit Party will instead contend seats held by the Labour party and other pro-EU parties. For Tuesday's session, GBP-USD headed back to 1.2815 in London morning trade, though rallied toward 1.2875 in N.Y. Sterling choppiness is liable to continue into the December U.K election.

    [USD, CHF]
    EUR-CHF has seen some choppy trading in recent sessions, but with an overall downside bias, despite the abatement in no-deal Brexit risk and the recent blast of risk-on positioning in global markets.

    [USD, CAD]
    USD-CAD pulled back from the one-month high of 1.3257 seen into the North American open. Canadian name profit taking has reportedly been the driver from the open, taking the pairing to 1.3216 lows. Support comes in at the 50-day moving average, which currently stands at 1.3205. Given recently disappointing Canada data, the odds for a BoC rate cut have improved, which in the bigger picture, should put a floor under USD-CAD. The next upside target will be the 200-day moving average at 1.3275.

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