JPY favoured consolidation in quiet trading conditions. USD/JPY was held to a narrow range after struggling to break 118.00 in yesterday's New York session. The downside was underpinned amid importer bids and option related support. Bearish dollar sentiment restricted movement on the topside. Offers from 118.40/45 capped throughout and the pair drifted towards 118.25 ahead of the North American open.
EUR/JPY was corrective after trading up to 149.62 in the Asian session. Selling from custodial names and trust banks was noted, with some of the activity linked to a big coupon and redemption payment due next week (France 34 billion).
This left the pair on a heavier footing but the pair found support ahead of 146.00 amid demand from leverage accounts and Japanese players looking for yield. Activity from Japanese names was evident via GBP/JPY, AUD/JPY and EUR/JPY. A thin data schedule should result in a quiet European afternoon session.
EUR/JPY is biased to the downside after meeting resistance at 149.65. Stops are noted at 148.80. USD/JPY is bearish but expected to hold above the 118.00 handle, where a large barrier expires on Monday.
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