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By XE Market Analysis November 24, 2014 2:41 pm
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    XE Market Analysis: Asia - Nov 24, 2014

    The dollar meandered inside of narrow ranges through the N.Y. session on Monday, and may have set the tone for what could very well be a quiet, holiday shortened week. Aside from the Chicago and Dallas Fed indices, which were shrugged off, there was no U.S. data on Monday. EUR-USD held support at 1.2400, though managed highs of just 1.2445, while USD-JPY remained above 114.00 throughout the session, peaking just shy of 118.50. USD-CAD moved briefly over 1.1300 on short covering interest, while cable followed the euro modestly higher, reclaiming the 1.57 handle.

    [EUR, USD]
    EUR-USD maintained a slightly upward sloping glide-path through the morning, opening just over 1.2400, and later making its way to 1.2444 highs. EU deflation risks will likely keep the euro down in the bigger picture, as the market prices in ECB QE, though price action may be a little distorted this week, with U.S. activity at least, tempered by the Thanksgiving holiday. We look for range trade to prevail..

    [USD, JPY]
    USD-JPY ranged between 118.19 and 118.48 through the N.Y. session, and after breaking above the 118 threshold in London trade, continued to find buyers over the figure. The pairing held 118.25 through the afternoon session in quiet dealings. Light stops are expected at 118.60, with Thursday's 118.97 the next natural upside target. Exporter offers are said to be building into 119.00 now.

    [GBP, USD]
    Cable remained with Friday's range on Monday, trading over 1.5700 after seeing a 1.5628 low during the London AM session. A tide of BoE MPC member speak will arrive tomorrow during regular parliamentary testimony, which we expect will be neutral-to-bearish for sterling. Cable tested resistance at 1.5714 (Friday's high) in afternoon trade before easing back under the figure.

    [USD, CHF]
    EUR-CHF has traded slightly firmer, lifting to the 1.2025-30 area, after SNB's Jordan repeated his opposition to gold initiative, arguing once again that it would impede the central bank's ability to defend the 1.2000 franc cap.There are market rumours that the SNB has effectively set up a buffer zone by lining up bids from 1.2010 to 1.2000, and Reuters has reported last week that a sizable bid was conspicuously placed on EBS at 1.2006.

    [USD, CAD]
    USD-CAD touched 1.1257 highs into the open, moving up during the London morning session from overnight lows of 1.1225. The modest rally largely coincided with oil's move down to near $76.00/bbl, from intra day highs near $77.00. With nothing of import on either the Canadian or U.S. calendars, trade remained largely quiet. The pairing later topped the 1.1300 mark, peaking at 1.1312. Some short covering was noted through the morning, with profits booked from last Friday's post-CPI sell-off, and ahead of Tuesday's Canadian retail sales data. The uncertain commodities backdrop has also supported, as oil's outlook remains dodgy, and as gold traded under water.

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