FX trade was quiet again on Wednesday, with familiar ranges holding up across the board. There was no data to drive prices, though the risk backdrop was marginally positive, allowing equities to rise. The dollar was mixed, though ended the day mostly where it started. After idling around 1.3040, EUR-USD attempted to rally, but only made it to 1.3080 before sellers returned. USD-JPY meanwhile, moved up from 87.40 to highs just over 88.00. Traded volumes were reportedly very light, which according to sources has been the case since the start of the year. It is unclear which events will move the dollar out of its holding pattern, though with light economic releases through the end of the week, range trade looks set to continue.

[EUR, USD]
EUR-USD drifted lower into the N.Y. open after central bank support gave way between 1.3065 and 1.3050. EUR-JPY selling pressure weighed from 114.50 into 114.10, but EUR-USD steadied once intra-day stops were filled through 1.3050. More buyers were noted into 1.3040 and larger support between 1.3020 and 1.3000, which put a floor under the pairing through the session. The euro bounced back to 1.3080 from 1.3035 lows, before settling in under 1.3060. All eyes will be on the ECB announcement and Draghi's press conference on Thursday, after the central bank played a major role in helping to stabilize markets in 2013. There were reports that a majority of council members supported a rate cut at the last meeting. But Draghi's statement did not signal an immediate move even as he kept the door open for further action. .

[USD, JPY]
USD-JPY moved to intra-day highs of 88.00 in afternoon trade. The dollar pairing had been on the rise since it bottomed out just ahead of 86.80 in early Asia-Pacific trade. Japanese buyers were persistent throughout. USD-JPY demand included corporate accounts, offshore funds and a prominent Asian sovereign. The crosses experienced good inflows from Japanese retail accounts following the shake out on Tuesday. Interest has been marked via the commodity bloc currencies, but EUR, GBP and CHF have been pressured. In the absence of larger leads it does look as if macro funds have started to put on positions after a whippy couple of days last week and favor both yield and countries exposed to raw materials. USD-JPY buy stops are noted above 88.00.

[GBP, USD]
Cable firmed up after it met buyers under 1.6050 in early London trade. The U.K. trade deficit came in close to expectations. The underlying trend remains weak and likely to hamper Q4 GDP growth. Cable has drifted within a narrow trading range since the start of the week, with directional bias limited since the start of the year. The U.K. outlook remains weak and macro traders are still looking to sell into strength. N.Y. dealings saw the pairing slip briefly under 1.6000, as the dollar firmed more broadly, though buyers quickly returned.

[USD, CHF]
USD-CHF steadied after it held on to the 0.9200 level following a brief period of dollar weakness during Tuesday's Asian session. USD-CHF's move lower came in lockstep on the EUR-USD squeeze up through 1.3100 and extended run on 1.3140. However, broader market sentiment weakened and the dollar firmed up, which lifted USD-CHF back to the 0.9250, where it has been in N.Y. and since today's open. We expect short term accounts to play the range. However, a break below recent lows at 0.9185 would reinforce dollar bears. EUR-CHF is still trading within a wafer thin range just under 1.2100.

[USD, CAD]
USD-CAD eased back to the bottom of its range into mid-morning, continuing to find buyers on either side of 0.9850, and sellers into the 0.9880 mark. Sell stops were touted at 0.9840, and a break there will likely see the December low of 0.9825 targeted. The stops were safe however, as aggressive USD-CAD buying was reported into the 0.9855 level, with corporate bids still lined up at 0.9850, according to traders. The pairing moved back over 0.9875, though momentum was stopped by reports of offers from 0.9880. It appears USD-CAD is fairly well hemmed in for now.