Dollar rebound continues in Asian session today and trades generally high. Weakness in more notable in Aussie and Euro, as both turn soft in crosses. Overall risk sentiment is slightly negative, with particular deep selloff in Hong Kong stocks, but Nikkei remains resilient. The economic calendar is very light today and movements in the currencies would likely follow broader markets. Nevertheless, inflation data from US, Canada and UK could lift volatility later in the week. Technically, EUR/USD's break of 1.1792 support suggests rebound from 1.1663 has completed after rejection by 1.1907 structural resistance. We'd pay attention to whether the development is more of a release of Dollar strength or Euro weakness, or both. Break of 129.57 support in EUR/JPY would bring deeper fall back to 127.91 low. On the other hand, USD/JPY might try to rise back towards 110.79 resistance, even if sideway trading continues. We'll keep an eye on the interactions between the three. In Asia, at the time of writing, Nikkei is down -0.34%. Hong Kong HSI is down -2.38%. China Shanghai SSE is down -0.38%. Singapore Strait Times is down -1.06%. Japan 10-year JGB yield is up 0.0025 at 0.048. |
