Failure Thursday to build on its break...>

DOLLAR-YEN: Failure Thursday to build on its break above Y111.00, the rate

extending the recent recovery to Y111.13, saw longs begin to pare back with the

corrective pullback given added weight by the release in early NY of weaker than

forecast US Retail Sales data. Rate traded down to an initial low of Y110.50,

recovered to Y110.81 ahead of the 1600GMT fix before it extended lows to

Y110.46. Early Asia edged rate to Y110.55 before fresh sell interest emerged as

risk outlook turned sour on pessimistic outlook for current Sino-US trade talks.

The latest FT source piece suggests that "both sides were scrambling to at least

produce a "memorandum of understanding" by the end of Friday that could help

pave the way for a meeting between the two presidents next month." The break

below Y110.46 then brought pressure to bear on reported support from Y110.30,

the rate though pressed to a low of Y110.26 before rate reversed tack back up to

Y110.40 ahead of Europe. Opening Europe nudged rate on to Y110.47 before

momentum faded. Support remains between Y110.30/20, stronger into

Y110.00(traders noting the option expiries at Y109.95-110.00 for $2.96bn). A

break of Y109.90 could pressure stale longs. Resistance Y110.45/55.