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By XE Market Analysis February 17, 2017 6:24 am
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    XE Market Analysis: North America - Feb 17, 2017

    The dollar picked up modest ground in N.Y. morning trade on Friday, though as was the case in London, USD-JPY did not participate in the rally. That pairing remained capped by the 113.00 level, posting 112.62 lows early in the session. EUR-USD eased under 1.0620 at the London close, while USD-CAD topped 1.3125 after trading over its 20-day moving average of 1.0599. Cable stayed weak, unable to retake the 1.2450 level. Better than expected leading indicators had little market impact, as Wall Street was mixed, as yields trended a bit lower.

    [EUR, USD]
    EUR-USD ended the week on a softer footing, basing at 1.0621, though remaining well above its weekly low of 1.0522. The 50-day moving average, which stands at 1.0596 now, will be the next support region. Markets will continue to look to EU politics, ECB developments, and prospects for a March Fed rate hike, all of which would appear to limit the euro's upside potential going forward.

    [USD, JPY]
    USD-JPY remained depressed through the session, with risk off and lower yields weighing. The pairing touched 112.62 lows, a seven-day base, after sellers emerged above the 20-day moving average, currently at 113.28. A close below there, which appears to be a good possibility, should see the February 9 bottom of 111.70 targeted next week.

    [GBP, USD]
    The pound continued to trade softly, showing losses against all of the G3 currencies on Friday and an average 0.7% decline versus these units on the week, making it the worst performer out of the currencies we track. While down on the day, Cable was up from an earlier test of its 50-day moving average at 1.2385, which was the second time over the last day the pound had tested and failed to breach the level.

    [USD, CHF]
    EUR-CHF traded heavily the past week, settling in the mid to low 1.06s. Last week's eight-month low at 1.0632 is back in range. The weakness of the cross stems from rising political risks in France into the April Presidential election. The Swiss franc was little-affected by the latest volley of SNB-speak last Monday, with president Jordan saying that negative interest rates are "indispensable" in capping an overvalued currency, while and his colleague Maechler argued that there would be "heavy consequences" of an even stronger franc for the Swiss economy and pension funds.

    [USD, CAD]
    USD-CAD has remained firm through the session, with the modest retreat in oil prices providing support, along with a fade in risk taking level. The 20-day moving average, currently at 1.3099 has capped the pairing all week, and a break above there may bring some stop loss buying to bear. The next upside target would be Monday's 1.3123 peak.

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