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By XE Market Analysis November 25, 2014 3:12 pm
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    XE Market Analysis: Asia - Nov 25, 2014

    Yields slipped a touch, as stocks posted modest gains, and the dollar pulled back fairly broadly in N.Y. trade on Tuesday, despite an upgraded Q3 GDP revision. Pre-Thanksgiving position squaring appeared to be the driving force, though a weaker consumer confidence print weighed on the greenback as well. EUR-USD found support into 1.2400, and later posted gains over 1.2480. USD-JPY meanwhile, peaked near 118.30 after the GDP data, eventually falling to lows of 117.72. USD-CAD stayed down despite sharply weaker oil prices, while cable moved over 1.5730, though struggled to maintain altitude.

    [EUR, USD]
    EUR-USD posted session lows of 1.2403 after the improved U.S. GDP data, though after finding good buyers ahead of the figure, made its way higher. Gains stalled over 1.2480, ahead of noted offers from 1.2500, and resistance seen at 1.2504, which represents last Thursday's low. Following losses of over 200-points from Friday's 1.2568 peak, the combination of better EU data and softer U.S. confidence this morning, provided the impetus for short covering ahead of Thursday's Thanksgiving holiday.

    [USD, JPY]
    USD-JPY rallied to near 118.25 from just over 118.00 after the GDP data, though eventually slipped to 117.72 lows in afternoon dealings. The pairing has been in consolidation mode so far this week, after making a seven-year peak at 118.97 last Friday. We look for the dollar to maintain a 117.50 to 118.50 trading band into the U.S. Thanksgiving holiday.

    [GBP, USD]
    Cable is in consolidation mode on either side of 1.5700. Weaker than expected BBA mortgage approvals didn't have much impact, and nor did the parliamentary testimony of BoE MPC members, which elicited generally upbeat views of the economy but with mostly downbeat views of inflation. The pairing moved to highs over 1.5736 in n.Y. dealings, as a broadly weaker dollar supported.

    [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 session lows of 1.1232 after the softer U.S. data. The pairing was unable to reclaim the 1.1300 handle earlier, which reportedly brought on a round of position paring. Bids were noted into 1.1220, which could provided a base for the time being. Despite the 2% drop in oil prices, USD-CAD stayed down through the session, running into fresh sellers ahead of 1.1270.

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