Yen maintains strength, keeping USD/JPY below 120

USD/JPY and the JPY complex did little in Asia in quiet, nondescript trading. Tokyo was loath to trade after the fireworks o/n which forced many recent longs to pare positions. Tokyo was sanguine over the report of a less ease-leaning BoJ. Policy Board member Morimoto’s view is just another minority opinion, and he is due to leave the board in the spring. Trading 118.81-119.16 for most of the day and towards the top of Tokyo’s 118.50-119.00 perceived core range, it fell later to 118.45. Volume was low. Option-related bids remain from @118.50 and trail down with plenty of large expiries today down to 117.89. Topside expiries are just as thick from 119.00 and trail up to 121.00. US yields traded soggy and weighed. EUR/JPY traded 135.55-87 before falling back in sympathy with USD/JPY to 135.24. GBP/JPY moved down from 183.29 to 182.46. AUD/JPY was steady between 91.92-92.37. AUD in general saw a modest relief rally after RBA Stevens parliamentary testimony. NZD/JPY too did little, holding steady between 88.17-42.

EUR/USD and the EUR complex consolidated gains seen in most overnight. EUR/USD traded 1.1394-1.1410, just below last night’s 1.1423 high, before a late lift to 1.1430 on USD/JPY-led USD weakness. There seems to be nothing at the moment to dampen optimism over the Ukraine ceasefire plan or a deal between the EU and Greece, maybe as soon asMonday. Large option expirations are eyed at 1.1340, 45-50, 55, 65, 1.1400 and 50 today. EUR/GBP was in a holding pattern between 0.7406-14. The path of least resistance still looks to be down and stops are eyed sub-0.7370, 0.7372 the trend low yesterday. The 200-MMA is at 0.7368. EUR/CHF fell back from 1.0638 last night and 1.0614 early in Asia to 1.0579. The market remains wary of more SNB action however.

GBP/USD traded a tight 1.5381-95 before spurting up to 1.5420 on afternoon USD/JPY-led USD weakness.

USD/CHF fell back from 0.9307 to 0.9277 in sympathy with USD/JPY.

AUD/USD opened in Asia at 0.7734. To-fro action ensued after RBA Gov Steven’s parliamentary testimony. A dip to 0.7721 followed the prepared text but a rally to 0.7767 was seen after the Q&A session with pessimistic shorts squeezed. ABS’s lack of concern over yesterday’s weak jobs data helped. Offers at 0.7770 were absorbed as the market saw another bump up to 0.7781 later.

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