Currency Analyst since 2010

Nov. 25: Asian session

Oil prices fell on Monday as Iran and six world powers clinched a deal earlier today curbing the Iranian nuclear program in exchange for sanctions relief.  The deal could lead to a further easing of the Middle East tensions and is seen positive for global growth and risk appetite. As a result, demand on the “safe” Japanese yen remains low. USD/JPY broke above the strong 101.50 resistance (July 8 high) and rose to 101.85. It is the highest level since May 29. EUR/JPY almost reached 138.00 and is trading at the highest levels since 2009. The Nikkei 225 index rose by 1.3%. USD/CHF recovered from 0.9060 to 0.9090. Switzerland will release employment figures at 08:15 GMT.

EUR/USD tested resistance at $1.3560 and then slipped to $1.3540. There will be no important news releases in the euro area today. The ECB’s Noyer said that the region has low inflation and not deflation. As for the US, watch pending home sales at 15:00 GMT (forecast: 2.2%; previous: -5.6%). GBP/USD touched $1.6240 and then returned to the opening levels around $1.6220. BBA mortgage approvals are due at 09:30 GMT.

AUD/USD is retesting the Friday lows at $0.9145. Aussie attempted to recover earlier in the day, but was capped at $0.9190. This week we have more RBA speeches starting with the RBA Deputy Governor Lowe tonight, so AUD seems to be exposed to more downside risks. NZD/USD has recovered above the $0.8200 mark, supported by the talks of a strong New Zealand economy and subsequent rate hikes. Analysts at ANZ now expect the rates to be raised in January 2014. USD/CAD rose to 1.0560 approaching Friday’s high. Canadian dollar declined as the Bank of Canada’s expected to keep interest rates low since inflation fell below its target.

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