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Extension Of Familiar Themes

FOREX

The greenback has extended its run higher in early Asia-Pac trade, benefitting from risk off sentiment as e-minis dip and regional indices open lower. Commodity prices have also paused their recent run higher which is weighing on high beta currencies.

  • JPY has continued to weaken, USD/JPY making fresh multi-year highs. PPI data earlier showed the annual print above estimates, but this was ignored in favour of a continuation of recent themes.
  • This brings the pair within range of key downtrendline resistance drawn off the high last printed in December 1975 - a level that crosses at 113.41 Monday - inline with the intraday high.
  • Focus Tuesday turns to UK jobs numbers for September and the German ZEW survey. A number of ECB speakers are scheduled, with ECB's Lane, Lagarde all on the docket alongside Fed's Clarida, Bostic and Barkin with liquidity returning to market after bond markets were closed in the US for Columbus day.

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