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Forex Trading: New York Market Summary

Posted by Joseph Trevisani on Apr 10, 2013 4:36:00 PM


EURO

The euro opened the US session at 1.3100 (8:00 am ET), after trading in a 1.3074 to 1.3122 range in prior Asian and European action. The pair was weighed on almost immediately by reactive euro/yen selling in the wake of comments from Bank of Japan (BOJ) Governor Kuroda that 'FX rates were not the target of monetary policy,' which sent the cross to lows near 129.41. After bottoming then at 1.3065, the euro struggled to get back over 1.3100 even though euro/yen easily revaulted 130.00.

The early release of the FOMC minutes sparked new euro selling as US Treasury yields pushed higher faster than German bund yields. The FOMC minutes were deemed more hawkish than expected. The euro bottomed around 1.3053 and held above key support (1.3048 was the  March 25th high, now seen as pivot support) and then edged up into the close.

The euro ended  at 1.3068 at 5:00 pm ET.

YEN

Dollar/yen opened the US session at 99.54 at 8:00 am ET after trading in a 98.91 to 99.58 range in Tokyo and London. The US open came as BOJ Gov Kuroda made a pair of remarks,  that FX rates were not the target of BOJ monetary policy and that he doesn't expect large Japanese investment outflows from the country seeking better returns due to new QE policy drove the dollar/yen lower.

It did not take long for the pair to recover. Rising US Treasury yields, after the FOMC March minutes were released, served to support dollar/yen and the pair rose above overnight highs seen before Kuroda's comments, to post a new high of 99.73. The pair then retreated as United Kingdom  and eurozone players headed home but found solid support around 99.40-45. As US Treasury yields edged higher, dollar/yen firmed again, this time rising to 99.83 before stalling.

Dollar/yen closed at 99.79 bid; and euro/yen at 130.41 bid at 5:00 pm ET

Market News International & WorldWideMarkets

Chart: Bloomberg

ScreenHunter 932 Apr. 10 17.03

 

ScreenHunter 931 Apr. 10 17.01

 

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