Asia Session Recap

Daily Forex Fundamentals | Written by Forex.com | Jul 23 08 03:30 GMT |

The story in today's Asia session was one of consolidation but the narrow ranges could be hiding a potentially larger theme. Stronger US equities and lower commodity prices contributed to a powerful rally in the USD. USD/JPY has broken through the critical 107.10 area and EUR/USD now can't get back over 1.5800. If we see further sideways movement this could be a setup for a continuation move higher in the USD. An interesting relationship appears to be developing in the EUR. Could it be acting as a new 'safe haven' currency? Recently we have seen buyers pile into it whenever there was a whiff of uncertainty and similarly we have seen a sharp decline in EUR/USD as US financial stocks have staged a sharp rally. As we have all seen correlations can change (JPY crosses and equity markets) but this could be one to watch. Looking forward, we have the Bank of England minutes during the London session as well as more data later in the week concerning the US housing market. The balance of the week in Asia is focused on the Reserve Bank of New Zealand rate decision and Japanese CPI. Upcoming Economic Data Releases (London Session): UK: (8:30GMT) Bank of England Minutes Forex.com http://www.forex.com DISCLAIMER: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase of sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.