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By XE Market Analysis September 24, 2013 2:32 pm
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    XE Market Analysis: Asia - Sep 24, 2013

    FX trade was sluggish again in N.Y. on Tuesday, though on net, the dollar was a touch firmer. The data calendar caused few upsets, as house prices rose, consumer confidence was a touch lower than forecasts, and the Richmond Fed index slipped. Treasury yields pulled back some, as Wall Street eked out marginal gains. EUR-USD touched lows of 1.3465 before running into buyers, while USD-JPY inched up to 99.00 after finding support into 99.50. New home sales, durables, and weekly petroleum inventory data are on deck Wednesday.

    [EUR, USD]
    EUR-USD ran into bids ahead of 1.3460, with buyers thick enough to keep sell-stops under 1.3450 safe for now. The pairing later made its way up to 1.3492 highs, though maintained a heavy feel overall. Offers are seen in place from 1.3500, layered to 1.3520, and the euro could not make strides over the figure, settling in around 1,3480.

    [USD, JPY]
    A flurry of JPY demand went through to take USD-JPY towards 98.50, where Japanese accounts were widely tipped since the start of the week. EUR-JPY also extended losses and cleared away support into last Thursday's base at 132.95. Speculative positions that were put on in the wake of the Fed's steady policy hand are slowing coming undone as the market re-evaluates when taper may start and also the U.S. debt deadline. USD-JPY later edged its way over 98.90 after finding solid support from Japanese names into 98.50. Option related offers are in place from 99.00, and it seems the pairing's range is well defined for now. Slightly better risk levels have put a bit of pressure on the yen this afternoon, though the lack of new positioning reported, should keep USD-JPY at familiar levels.

    [GBP, USD]
    Cable edged out of the 1.5955-60 area as large bids held. Option related buying was a feature of the upturn amid 1.6000 maturities. EUR-GBP, which has been supported on dips, met good offers into 0.8445, and another positive factor. However, GBP could add to losses on Wednesday on another negative close. Short term accounts that positioned for the downside will look for a Cable close under 1.6000. Tomorrow's focus for U.K. traders will come from U.K. distributive trade. This is of interest after last week's U.K. retail sales miss, which was the catalyst for the current period of corrective action in Cable.

    [USD, CHF]
    EUR-CHF stayed just below the 200-dma. However, yesterday's negative close under 1.2300 did not see any significant follow through. Macro funds were buying the dip, along with local names, though equally there was no interest to chase higher levels as EUR struggles to sustain altitude. EUR-CHF has not experienced any sustained period of movement under the 200-dma since April and it was interesting that yesterday's break lower brought SNB's Jordan to the wires. Specs are unlikely to aggressively test the downside on louder central bank rhetoric given the SNB's track record in keeping EUR-CHF elevated.

    [USD, CAD]
    USD-CAD slipped about 20 points under 1.0270 after the better ex-auto Canadian retail sales outcome. The pairing had been dead-sideways overnight, near 1.0290, before attempting, and failing to hold 1.0300. Bids remained in place at 1.0270, with offers from 1.0320. Another rangebound session, as USD-CAD bounced from post-data lows, back comfortably at 1.0290. The pairing managed 1.0305 highs, before settling in just under the figure.

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