Forex

Forex - US dollar mixed in Sydney afternoon, yen shines despite Japan holiday
01/09/06 03:23 am (GMT)


SYDNEY (AFX) - The US dollar was trading mixed against the euro and yen, while the Japanese yen is the flavor of the day following the weaker US payrolls data for December, dealers said.
They said the US dollar is likely to remain under pressure after the US payrolls data suggested the Federal Reserve will be close to ending its tightening cycle following a likely 25 percentage basis point hike on Jan 31.
At 2.00 pm Sydney (0300 GMT) the euro was softer at 1.2143 usd from 1.2146 in late Sydney morning trading while the dollar was weaker at 113.88 yen from 114.52.

Tricom senior client advisor Ashok Sekar told XFN-Asia the US dollar/yen has broken some pretty big levels here, providing a possible move down to 112.90 yen.
"There's some big Fibonacci levels currently at 113.80 yen and if it goes through here it could head back down to 109.00 yen," he said.
Sekar said the euro could get above 1.2200 usd but its more the case of the yen leading the course of the US dollar, while the single currency still has to tackle strong resistance at 1.2190 usd.

"I also think euro/Swiss franc is a trade to look at, with any move down to 1.5350 chf an opportunity to buy the euro" he said.
Dealers said the markets are focused on a possible re-balancing of China's foreign reserves which is adding volatility to the day's trading.
This followed last Friday's comments from director of Chinese Administration of Foreign Exchange, Hu Xiaolian, who said his agency plans "to actively explore ways of investing foreign exchange more efficiently."


Dealers said the official's comments will continue to be the main focus point until Friday's release of key US retail sales and producer price index data draws traders' attention back to economic data releases.
They said Thursday's US trade deficit data is also likely to draw traders attention as expectations of a peak in US interest rates will refocus attention on the record US external deficit.

Dealers said the European Central Bank and Bank of England both meet on Thursday, with no change to official interest rates expected.
Meanwhile, Tricom's Sekar said, "the Australian dollar is looking pretty good. If it does break the 0.7580 usd level, it has got a good chance of heading up to 0.7700 usd or so."
Sydney 2.00 pm (0300 GMT) Sydney 10.26 am (2326 GMT)
US dollar US dollar
yen 113.88 yen 114.52
sfr 1.2702 sfr 1.2712
Euro Euro
usd 1.2143 usd 1.2146
stg 0.6862 stg 0.6861
yen 138.29 yen 138.99
sfr 1.5427 sfr 1.5431
Sterling Sterling
usd 1.7698 usd 1.7685
yen 201.50 yen 202.55
sfr 2.2480 sfr 2.2487
Australian dollar Australian dollar
usd 0.7537 usd 0.7529
stg 0.4258 stg 0.4255
yen 85.815 yen 86.200
paul.daniel@xfn.com
pd/blh/dk

posted by rahul @ 7:42 PM