The dollar trended mostly lower through the day in N.Y. on Wednesday, as risk appetite largely held up. Dealings were relatively light into the U.S. Thanksgiving holiday on Thursday, and ranges were mostly relatively tight. Weekly jobless claims were near expected levels, though remained distorted by hurricane Sandy issues, while final November Michigan sentiment eased back a bit from preliminary levels. The data had little if any impact on FX prices, as focus was largely on position adjustments ahead of the holiday.

[EUR, USD]
EUR-USD headed back to 1.2800 after it bottomed out just ahead of 1.2735 during the Asian session. Reserve management activity and EUR-JPY buying interest provided a modicum of support on dips. There was disappointment that the eurogroup meeting ended without an agreement on Greece, but the European market held up quite well. N.Y. trade saw the pairing inch its way t o1.2835 highs in light dealings, before settling back to 1.2820 into the close.

[USD, JPY]
USD-JPY continued to hold on to a bid tone amid a combination of dollar supportive flows and persistent yen weakness. It tripped stops from 82.00 to 82.10 amid yen selling speculative accounts. The move is a continuation of the recent trend amid expectations of a LDP election win. On the topside offers are heavy to 82.40 from exporters, which lie ahead of early April highs of 82.43 and option barriers at 82.50. Option desks also note topside hedging from 82.50 to 83.00 for mid-December to early January. Nearly a yard of strikes changed hands at 82.75 for December-14, according to sources.

[GBP, USD]
GBP was a little firmer overall after the BoE voted 8-1 to keep the asset purchase target unchanged in early November. There were differences of opinion over the impact of QE and more stimulus, though some thought there was a case to be made and it would also discourage sterling appreciation. Extra stimulus would prevent damage to economy and also lower yields. Cable edged up from 1.5905-10 to 1.5930, but we think downside risk remains. On the downside support is noted to 1.5880 and into the 1.5855-60 area.

[USD, CHF]
USD-CHF topped out over 0.9450 after the rebound from 0.9400 in Asia ran out of steam. EUR fluctuations dominated price action. Sentiment in Europe held up quite well despite the eurogroup disappointing expectations for an agreement on Greece and will meet again on Monday. USD-CHF traders are still likely to play the range and we anticipate further buying interest into 0.9400 and below. SNB reserve management flows naturally provides the dollar with support on dips, while into the U.S. Thanksgiving holiday they are also likely to be dollar inflows. Meanwhile, EUR-CHF drifted lower after it met sellers just over 1.2050 and traded to 1.2042 lows, though buyers are noted at 1.2035-40.

[USD, CAD]
USD-CAD traded sideways in a 0.9960-85 range through the North American open, with offers parked at parity limiting gains. Oil and equities moved higher, which also kept the pairing under modest pressure. Pre-Thanksgiving position paring saw USD-CAD ease to the bottom of its range in light afternoon dealings, though initial support is seen at 0.9950, which will likely keep losses to a minimum overnight.