The euro commenced the U.S. session at 1.3751, mid-way in the 1.3734-68 Asian and European ranges. Initial movement in New York was limited to 1.3749-57, but a bolt higher at 8:55 am brought the pair above 1.3760 which had been the effective top since midnight. Comments from Christine Lagarde Director of the IMF that the fund must act to stop the decline of inflation in Europe had no market impact.
U.S. Treasury yields had been falling since the beginning of the session but the dip below 2.80 percent in the 10-year helped bring the euro to 1.3774 from where it briefly consolidated around 1.3770. The breech of 1.3775 where there had been talk of substantial offers led to a sharp pull higher with stops driving to the day's high of 1.3795 within 15 minutes of first crossing 1.3775.
The top came just after the release of the U.S. JOLTS (job openings and labor turnover survey) job data from the Bureau of Labor Statistics which though better than expected elicited no reaction. The euro retreated quickly from the high, pausing first at 1.3780, and then spent most of the afternoon around 1.3765. A short flurry around 4:00 pm brought the pair back to 1.3776 before running down to the close at 1.3761.
When the euro first reached 1.3800 late last month it paused for two days just short of the figure reaching 1.3793 on the 22nd and 1.3793 on the 23rd. It did not breech 1.3800 until the 24th touching 1.3825 and then 1.3832, the high on the next day the 25th.
The euro traded above 1.3800 only four days and closed above only twice at 1.3801 on the 24th and 1.3802 on the 25th. By the 28th though it had touched 1.3818, it was already losing altitude and closed at 1.3775. On the 29th it traded back to 1.3813 but closed even lower at 1.3745. Then on the 31st the euro lost a figure and a half, opening at 1.3736 but closing at 1.3584. The euro will have to break above 1.3832, the old high, to gain a secure footing at these levels.
Dollar/Yen and Euro/Yen
The dollar/yen opened at 102.92 and euro/yen at 141.54, (8:00 am) with the steady improvement in the yen during Asian and European hours brining it down from 103.39 and 142.17. This trend continued for the first two hours of the New York session dropping the dollar/yen to 102.62 around 10:00 am.
The cross touched bottom much earlier at 141.28 and from then the cross followed the euro higher moving back to 141.77 about 10:30 am while the euro climbed from 1.3750 to 1.3795. The dollar/yen eventually reversed from the over dollar pressure and from 10:00 am to 10:55 am climbed back to 102.97.
With Treasury yields still falls, reaching 2.79% after beginning at 2.85% the dollar/yen again reversed and slipped to 102.58, an hour before the close. In this move the cross and the dollar were in concert, the euro/yen moving to 141.29 before closing at 141.50 and the dollar/yen at 102.83.
WorldWideMarkets Online Trading
Chart: WWM Alpha Trader