Asia Session Recap

Daily Forex Fundamentals | Written by Forex.com | Jul 25 08 05:36 GMT |

The final Asia Session of the week brought a follow-through from US equity markets, reiterating the importance of understanding inter-market relationships. Based upon the common denominator of risk, the FX arena has started to reiterate the correlation between assets deemed 'risky', such as stocks and the Carry Trade. Today, the Japanese Yen displayed exemplary strength, pressuring the pairs associated with the Carry Trade, as stocks took a pummeling in New York trading. The new day opened on a tepid note, but roughly two hours into trading, USDJPY began to roll over from the 107.50 zone. Instead of providing life to EURUSD and GBPUSD, the pair dragged down the crosses. EURJPY dove from 168.50 to 167.65, hitting levels unseen in a week. The one-dimensional market theme overshadowed any life beyond the Japanese Yen. EURUSD held a tight 30 pip range just south of 1.5700. Cable flipped on either side of 1.9850. London traders will close out their week with the release of UK GDP at 0830 GMT (0430 EDT). These data points have sparked substantial volatility this week, so market players should certainly keep the numbers on their radar. Also noteworthy is the stabilizing price of Crude oil futures, now sitting at $126/barrel. The round numbers of $120 (support) and $130 (resistance) are the levels to watch. Upcoming Economic Data Releases (London Session) 0600 GMT Germany - June Import Price Index, consensus: +1.0% MoM, +8.4% YoY (relevance: low) 0800 GMT EuroZone - June Money Supply (M3), consensus; +10.3% YoY (relevance: low) 0830 GMT UK - Q2 GDP, consensus: +0.2% QoQ, +1.6% YoY (relevance: high) 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.