Market Analysis: Asia - Oct 2016

The greenback trended higher in N.Y. trade on Mon, keeping the DXY close to its virtually nine-month high recorded in London. EUR-USD mitigated underneath one.0875 from highs of one.0899 into the open, whereas USD-JPY topped  at higher than a one-week high over 104.30. USD-CAD ran up to inside a hair of the 134.00 mark, whereas cable ebbed back underneath one.2200. Incoming U.S. knowledge had very little impact, tho' the improved flash producing PMI provided some support to the dollar. Wall Street rallied on tight earnings and recent MA& activity, permitting yields to maneuver higher.

EUR-USD was stopped dead in its tracks into the one.0900 level into the N.Y. open, and has since force back to one.0877 lows. With expectations remaining comparatively high for a December Fed rate hike, and improved odds that the ECB extends its QE program on the far side next March, that is anticipated to be proclaimed at the December council meeting, the euro's path would seem to favor the draw back going forward.

USD-JPY written one-week highs of 104.32, obtaining support from rallying stocks and a usually firmer dollar. The Gregorian calendar month high of 104.63 is that the next major top target, and given firmer Fed rate hike expectations, and potential for any BoJ stimulation early within the yr, the pairing will be expected to stay in buy-the-dip mode.

Cable ebbed back below one.2195 in N.Y. trade amid greenback firmness, that has place a ways in from the London AM session high at one.2250. EUR-GBP, meanwhile, continuing to carry in a very slender orbit of zero.8900. The pound managed to post moderate internet gains versus the G3 currencies last week for the primary time in four weeks, that coincided with weekly CFTC knowledge showing a modest dip within the internet speculative short futures position within the pound, tentatively suggesting that the currency might have entered a a lot of stable commerce part.

EUR-CHF has extended declines to the low one.08s amid broader monetary unit declines. when seeing a annual low at one.0623 on Midsummer Day, within the immediate wake of the UK's vote to go away the ecu Union, EUR-CHF appearance to own settled, albeit with some chop and occasional SNB help, in associate orbit centred around one.0800-1.0900. additional of identical appearance doubtless, tho' the balance might be upset ought to the monetary unit still underperform

USD-CAD relieved back from North yankee highs of one.3358, and also the nightlong seven-month high of one.3359. The CAD had been power-assisted by higher North American nation wholesale trade knowledge earlier, and relative stability in WTI crude, that control the key $50 level through the morning. BoC chief Poloz unbroken a rate cut on the table over the weekend in a very TV interview, which can well limit USD-CAD's draw back potential going forward. Later, the pairing denote one.3397 highs, levels last seen on March sixteen, once the high was one.3404. WTI crude's fall to seven-session lows of $49.64 was the catalyst behind the move, whereas buy-stops over Friday's one.3358 high helped the rally on.
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