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USD/JPY back below 119.00 after Yellen testimony

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USD/JPY maintained losses after Fed Chair Yellen’s noncommittal stance towards tightening and lower US yields. The pair moved off from 119.00 to 118.62. EURJPY fell back from 135.63 to 134.54 after the EU-Greece deal was confirmed in classic sell-the-fact fashion. Asia saw it down from a rebound high of 134.95 to 134.58. GBPJPY see-sawed between 183.47-87, weighed down by USDJPY but with the bias still up. A high of 184.67 was seen last night. AUDJPY and NZDJPY rallied, the former from 93.01 to 93.57 and the latter from 88.81 to 89.40 as AUDUSD and NZDUSD surged and despite USDJPY heaviness. However, with US Tsy 2s bouncing in Asia and some suggest the post-Yellen USD sell-off might be short lived.

EUR/USD opened in Asia at 1.1340 after recovering from 1.1288 yesterday on a dovish interpretation of Fed Chair Yellen’s testimony. Slightly better bid on the back of solid gains in AUDUSD and NZD/USD, EURUSD ticked up from 1.1337 to 1.1352. Any feel-good effects from the EU-Greece deal looks to have faded fast and central bank expectations are again the focus. EURUSD might be vulnerable later as the bearish interpretation of the Yellen testimony may have been a bit overdone. US Tsy 2s saw its yield bounce in Asia from the New York close, and bounces in other terms could be seen when New York re-opens.

GBP/USD saw a leg up from 1.5448 to 1.5479 on Fed Chair Yellen’s presumed dovishness and influenced by rallies in AUD and NZD. EURGBP consolidated losses to 0.7317 yesterday, trading 0.7330-43 in Asia. The bias here remains down.

USD/CHF did little, holding between 0.9488-0.9505. EURCHF too found itself stuck between 1.0773-89.

AUD/USD opened in Asia at 0.7830 and continued to rally, trading up from 0.7824 to 0.7887 and making tracks away from yesterday’s 0.7740 low. Short covering and stops above 0.7850, and better China PMI data helped. H

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