FOREX: Asia-Pac FX: USD Drifts Higher In Asia
The BBDXY has had a range today of 1218.71 - 1220.57 in the Asia-Pac session; it is currently trading around 1220, +0.10%. The USD has found some support between 1218-1220 and has consolidated here the last couple of sessions. USD/JPY should continue to be well supported but I suspect the USD will be sold against risk currencies like the AUD & NZD and the EUR if this surge in risk sentiment turns into an end of year rally for risk. I am caught undecided on the USD at the moment, I liked the fade into 1230 initially but short term I expect dips back toward 1210-1215 to now be supported first up. We could chop around sideways for a while while the market decides which way to go. Above 1230 and we could start to break higher, below 1205 and the downtrends momentum could be re-engaged.
- EUR/USD - Asian range 1.1547 - 1.1564, Asia is currently trading 1.1555. The pair continued to build on its support below 1.1500, I suspect rallies will now find sellers toward the 1.1650 area initially. This has been the pivot with the larger 1.1400-1.1900 range over the past few months.
- GBP/USD - Asian range 1.3158 - 1.3181, Asia is currently dealing around 1.3170. The pair continues to build on its bounce off the 1.3000 area. I continue to favor fading rallies though as GBP looks to have put in a medium term top. I suspect the 1.3250-1.3300 area is the place to fade if we see that level again.
- Cross asset : SPX +0.05%, Gold $4145, BBDXY 1220, Crude Oil $60.01
- Data/Events : EZ ZEW Survey Expectations, Germany ZEW Survey Expectations
Fig 1: BBDXY Spot 2H Chart
Source: MNI - Market News/Bloomberg Finance L.P
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