Thursday was profit taking day for the dollar, as the unit gave up ground versus all of the majors. EUR-USD was up better than 100 points over 1.3030, after making trend lows early on, while USD-JPY slipped under 95.80, down from its peak near 96.60. USD-CAD broke 1.0250 support, posting three week lows under 1.0220, while cable found some footing, running up briefly over 1.5100, after making multi year lows earlier in the week. The dollar has been correlated to the U.S. fundamental outlook of late, though today's USD softness appeared to have been nothing more than corrective positioning related. Friday's U.S. calendar includes February CPI, the March Empire State index, January TIC flow data, and February industrial production.

[EUR, USD]
EUR-USD touched 1.3030 after it rebounded from new 2013 lows at 1.2912. More dollar supportive U.S. data underpinned a EUR move to new lows, but oversold short term indicators and option protection fueled a move back up to rally highs around 1.2980. Buyers at the lows included sovereign names and short term funds were tipped. A move through 1.3000 would see stop loss activity and there is further technical resistance into the 1.3015 area. In the last 24 hours movement into 1.2980 met real money accounts, but dollar buyers may be suffering from exhaustion currently.

[USD, JPY]
The JPY came under pressure from the European open after the lower house approved the three nominees for the new BoJ leadership, which raised hopes for tomorrow's upper house vote. As the dollar climbed broadly through the N.Y. session however, USD-JPY came under some pressure, and easing back to 95.75 from intra day highs over 96.50. While the upper house vote is likely to result in the current slate of BoJ nominees, some position paring appeared to be in effect in N.Y. dealings.

[GBP, USD]
Cable cleared out weak shorts on a squeeze up through 1.5000 after good buying interest went through from 1.4950. Steady buying interest filled in a series of offers between 1.4960 and 1.5000. The large 1.5100 strikes that dealt for a Monday expiry continued to capture market attention, and were eventually extinguished, while the earlier FT story that Qatar may invest up to GBP 10 bln into key infrastructure projects has also added positive guidance. Since Cable reached new trend lows on Tuesday corporate buying has been much higher than usual, along with activity from U.K. pension funds. BoE Governor King is also due to speak on U.K. television at 18:30GMT. King has been an advocate for further policy stimulus and voted for GBP 25 bln last month.

[USD, CHF]
EUR-CHF was firmer overall after the SNB left policy unchanged, which was widely expected. Local names, which were long into the decision, booked profit and this resulted in a brief dip from 1.2355 to 1.2335. Thereafter it took off to print session highs around 1.2370, where a build up of offers have been tipped in the last few sessions. USD-CHF also moved up to 0.9545 ahead of the announcement, but dropped to 0.9450 on a "sell on the fact" move through the N.Y. session. The SNB look no where near changing policy ahead after it lowered its inflation forcast a notch to -0.2% for 2013 from -0.1% previously and it expects it to pick up to +0.2% for 2014% and 0.7% in 2015. However, it also looks unlikely that the SNB will offer further stimulus unless there is a significant deterioration in growth or the eurozone situation was to rapidly change course.

[USD, CAD]
USD-CAD was rangebound through the morning session, managing a 1.0254 to 1.0274 trading band since the North American open. The pairing had been hemmed in all week by offers from 1.0280 and bids under 1.0250, though good selling kicked in on Thursday on the move under 1.0250, taking out stops at 1.0240 on its way to three-week lows under 1.0220. Option backed selling was seen on the way down, while short term spec accounts were aggressive sellers under 1.0240. More bids are seen in place into 1.0200.