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By XE Market Analysis November 26, 2013 2:46 pm
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    XE Market Analysis: Asia - Nov 26, 2013

    The dollar meandered in fairly light pre-holiday trade on Tuesday, though ended mostly lower versus major currencies. EUR-USD made its way to highs over 1.3570 after finding support into 1.3520, as USD-JPY again failed to test 102.00, and fell toward 101.20 on paring of long positions. Cable rallied out of 1.6140 to come up just shy of 1.6200, as USD-CHF dipped back under 0.9100. On the data front, housing prices increased a bit more than forecast, though softer consumer confidence weighed some on the greenback. For many U.S. players, Wednesday will mark month end, as many books are in the process of closing for the year. As a result, order driven moves in a low liquidity environment may result in some choppy price action for the remainder of the week.

    [EUR, USD]
    The dollar perked up following the firmer house price data. EUR-USD eased to 1.3525 from 1.3545, though found good buying interest into 1.3520. The softer consumer confidence print ruined dollar bull's day however, as the pairing marched to highs of 1.3572 after the London close. There was more dovish ECB speak from Coeure during the London morning session, who repeated that cutting the deposit rate is an option. ECB officials have been vocal since the ECB cut rates, but EUR has not sustained lower levels and looks poised to threaten 1.3600 in due course.

    [USD, JPY]
    USD-JPY attempted and failed another run to the topside in early trade. The pairing peaked at 101.65 before running out of steam. The dollar turned a bit lower on the move under 101.35, which had held up on several occasions since yesterday. Stale longs apparently threw in the towel on the latest move, after the pairing had failed to test the 102.00 region. This has resulted in intra day lows of 101.22. Another layer of bids is noted at 101.00, though stops are likely under the figure.

    [GBP, USD]
    Cable pushed back over 1.6190. Intra-day accounts that were playing the range bought ahead of support at 1.6130, which limited EUR-GBP's small rally into 0.8400. The cross should still meet demand on dips and bids are anticipated from 0.8350 to 0.8330 in the coming sessions. Cable looks poised for a period of sideways action while resistance at 1.6250-60 holds, though the underlying trend is still looking good for another topside test in the coming sessions. Note, the earlier call by a U.S. bank to go short has not had much impact today, which may give some optimism for GBP bulls.

    [USD, CHF]
    CHF was a touch easier intra-day, taking EUR-CHF back over 1.2325 and USD-CHF back over 0.9130. Ranges remained narrow, but local names saw last Friday's EUR-CHF move to two-week lows of 1.2285 as a buying opportunity, leaving 1.2280 stops intact. CHF-JPY, which has been buoyant of late, pulled back from a new 23-year high of 112.13 in early Europe to trade back at 111.65 as profit taking went through. Switzerland voted on Sunday on a proposal that would have limited executive pay to 12 times that of the lowest paid. 65.3% voted against the plan, which was widely expected.

    [USD, CAD]
    USD-CAD rallied out of 1.0520 on its way to highs of 1.0558, where it was said to have run into a band of offers up to 1.0570. Barrier options remain in place at 1.0600, and will likely be defended into their reported Wednesday expiry. In the meantime, range trade looks set to continue, with corporate bids seen from 1.0520 to 1.0500. The pairing did ease back to 1.0540 in light afternoon trade.

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