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USD/JPY As the Asian session shifts to Europe, the USD/JPY is weakening and printing daily lows. Early in Asian morning, the pair had ralied intensely from the lower end of the 86.00 mark to 86.64 high on the back of deflationary Japanese data.
The National CPI improved from -0.4% to -0.2% in November, but was still negative, as it was “Ex food and energy” and “Ex fresh food” data. Tokyo CPI fell further to -0.6%. The annualized flash Japan industrial production fell from -4.5% to -5.8% in November.
UBS analysts are bullish: “We expect more upside in the near term towards 89.16”, wrote analyst Gareth Berry, pointing to 91.13 in case of a break.
EUR/USD US Senate majority leader Harry Reid's disappointment yesterday, expecting the country to fall into the fiscal cliff, took the market by surprise as the EUR/USD plunged from 1.3282 to 1.3210, and then went as low as 1.3202. New positions allowed the pair to bounce and range at 1.3240/50 during the Asian session. The EUR/USD is trading at the high end of the range.
The House of Representatives will meet in a previously-unscheduled session on Sunday, while President Obama will meet today with Democratic and Republican leaders.
UBS analysts are bullish: “We look for a potential break above 1.3386, the March high to extend the strength to 1.3493”, wrote analyst Gareth Berry, pointing to support at 1.3143
EUR/JPY 116.70 is the 50% retracement of the big fall from 139.20 to 94.00 and should be respected, as the Yen pairs always seem to pay particular attention to the 50% pull-back level. Above that, there is more resistance in a row of daily highs near 117.90.Support levels should now be firm beginning at 112.50 down through 111.40. Playing a wide 111.50/116.50 range over the New Year holiday does seem like a sensible strategy.
The National CPI improved from -0.4% to -0.2% in November, but was still negative, as it was “Ex food and energy” and “Ex fresh food” data. Tokyo CPI fell further to -0.6%. The annualized flash Japan industrial production fell from -4.5% to -5.8% in November.
UBS analysts are bullish: “We expect more upside in the near term towards 89.16”, wrote analyst Gareth Berry, pointing to 91.13 in case of a break.
EUR/USD US Senate majority leader Harry Reid's disappointment yesterday, expecting the country to fall into the fiscal cliff, took the market by surprise as the EUR/USD plunged from 1.3282 to 1.3210, and then went as low as 1.3202. New positions allowed the pair to bounce and range at 1.3240/50 during the Asian session. The EUR/USD is trading at the high end of the range.
The House of Representatives will meet in a previously-unscheduled session on Sunday, while President Obama will meet today with Democratic and Republican leaders.
UBS analysts are bullish: “We look for a potential break above 1.3386, the March high to extend the strength to 1.3493”, wrote analyst Gareth Berry, pointing to support at 1.3143
EUR/JPY 116.70 is the 50% retracement of the big fall from 139.20 to 94.00 and should be respected, as the Yen pairs always seem to pay particular attention to the 50% pull-back level. Above that, there is more resistance in a row of daily highs near 117.90.Support levels should now be firm beginning at 112.50 down through 111.40. Playing a wide 111.50/116.50 range over the New Year holiday does seem like a sensible strategy.
