2013-04-01 20:27 (UTC)
XE Market Analysis
The dollar was mostly weaker in N.Y. trade on Monday, though with most of the Continent, and London on holiday, dealings were quiet overall. Major dollar pairings were rangebound, though the softer U.S. manufacturing ISM data dented the greenback, along with equities on Monday. Markets should largely return to normal on Tuesday, with the Easter break officially behind us.[EUR, USD]
EUR-USD consolidated slightly higher after weak short positions squared out ahead of the Easter break, which will affect many global centers. Some chop was seen in Asia as selling interest appeared around 1.2790, but a subsequent recovery from sub-1.2780 levels brought 1.2800 back into play during the N.Y. session. The pairing bounced over 1.2850 in light dealings, though decent resistance can be expected into 1.2850-59 (the latter point marking the current situation of the 200-day moving average).[USD, JPY]
The BoJ meeting this week, on April 3rd-4th, will be a big focus as its the first for the new governor mega-dove governor, expected to unleash a new wave of asset purchases -- in the amount of "whatever it takes" to cure Japan's deflation problem. USD-JPY was heavy through the N.Y. session, though in tight ranges overall. It briefly dipped under 93.25, though returned to near 93.50 in late dealings.[GBP, USD]
GBP-USD drifted slightly higher, in sympathy with the EUR-USD move and other dollar pairings, meeting resistance into and around 1.5225. Bigger picture, the pound looks to have entered a broad consolidation phase after hitting major trend lows toward 1.4800 earlier in the month. The BoE's recent verbal interventions and expectations for a gradual improvement in the U.K. economy through 2013 have settled bearish appetite. Good demand can be expected into 1.5000. EUR-GBP hit a six-week low today of 0.8416 and has broken below both the 20- and 50-day moving averages in recent sessions. Support is marked at 0.8400, while 0.8450 marks resistance.[USD, CHF]
USD-CHF consolidated lower, trading under 0.9475 low after logging a two-week peak of 0.9553 last week. Good support is marked at 0.9500-05, with the 0.9500 level and its environs having proven to be a pivot level over the last month. We expect the pair to enter a broad consolidation in the coming weeks, during which period a further retreat seems likely, toward the 200-day moving average at 0.9416. EUR-CHF has continued to trade a steady path under 1.2200.[USD, CAD]
USD-CAD chopped around inside of 1.0160 and just over 1.0180 in very light North American trade on Monday. The pairing rallied to session highs after the softer U.S. ISM data, though ran into offers placed from 1.0180, stopping the climb. Bids were seen into 1.0150, which ultimately put a floor under USD-CAD.