AUD hurt by weak Australian jobs report

USD/JPY and the JPY complex fell back from overnight/early Asia highs but the downside for most was limited. USD/JPY fell from 120.47/48 to 119.98 on profit-taking and Japanese exporter sales. With USD/JPY back above 120 and levels not seen since January 5, exporter interest was not surprising. The downside was limited as intra-day shorts covered, especially after the bounce in both the Nikkei and US yields in the PM. Both had backed off a bit in AM trading, the former after a big gap up at the open. USD/JPY offers remain heavy from @120.50. Large option expiries are eyed at 120.75 (974 mln), 120.80 (454) and 121.00 (2.604 bln) too. EUR/JPY too fell on exporter sales from 136.70 to 135.77 but has since bounced. Bears do seem to be coming out of the closet ahead of 137.66, 38.2% Fibo retracement of 149.79-130.16. GBP/JPY fell modestly from 183.55 to 182.71 before bouncing back to @183.00. AUD/JPY literally plunged from 93.05 to 91.72 with the initial Tokyo-inspired move down exacerbated by weaker-than-expected employment data, It has since managed to move back above 92.00. NZD/JPY fell from 88.79 to 88.04 in sympathy before steadying.

EUR/USD popped from @1.1295 to 1.1336 into the New York close and Asia sent it up a bit more to 1.1353 after the CNBC report that EU sources indicated a deal has been struck between Greece and the EZ to keep Greece in the bailout program. Conflicting reports since capped it however. Once it was apparent that no deal was struck and that both sides couldn’t even agree on a statement, EUR/USD fell back to 1.1303 before steadying. The market still believes some sort of deal will eventually be hammered out, limiting EUR moves down for now. Resistance looks stiff at 1.1350-60 and good support remains ahead of 1.1250.

GBP/USD see-sawed between 1.5229-50 before falling back another small leg to 1.5217. EUR/GBP consolidated between 0.7420-47 after yesterday’s push down to 0.7385.

USD/CHF saw a leg up from an early low of 0.9262 to 0.9300 but still well within its recent range. EUR/CHF consolidated modest gains seen yesterday between 1.0500-20.

AUD/USD opened in Asia at 0.7716, down large on bearish calls, some for 0.68 near-term. Capped at 0.7730 and trading sideways into the jobs report, it plunged another leg to 0.7644 on the much weaker-than-expected data. Some doubted the veracity of the data but others suggested it may just have been a reaction to stronger-than-expected December data. The money market immediately built in a 70% chance of another 25 bp RBA OCR cut in March, leaving AUD/USD heavy and many eyeing a test of the 0.7627 post-OCR cut low on February 3 and maybe 0.7500.

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