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Forex Flash: JPY Longs in favour as EUR awaits ECB - UBS

FXstreet.com (Barcelona) - UBS Strategists Gareth Berry and Geoffrey Yu note that the yen was again net bought on the week, with asset managers continuing to lead the way.

They add that Hedge funds also showed liquidation but by their standards the amounts were not extreme. Further, the daily distribution of flow was quite telling: heading into Thursday investors were broadly flat USDJPY but on Friday there was a mini capitulation once it became clear the BoJ were not going to deliver anything new that could surprise that market. They write, “We also note that gross volumes in USDJPY were also the lowest in four weeks, and this was the same for JPY trades as whole.

Elsewhere, they note that EUR didn’t find much joy either, especially on the EURUSD leg as corporates engaged in their biggest selling week in three months, with asset managers not far behind. Some advance pricing of the anticipated ECB cut in May has occurred, which also points to strong chances of a bounce if no further rate action is hinted while growth policies come into play

Forex: EUR/USD stays above 1.3080 after US housing

Profit taking from 1.3116 high followed the release of German CPI and the EUR/USD eventually returned to 1.3080 area, where it was able to consolidate its gains during the European morning. US data is being published (US pending home sales just now) and investors are only waiting for Dallas Fed manufacturing business now.
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Forex: USD/CAD off 1.0133 low, bounce stalled at 1.0150

The USD/CAD is extending the downside seen since April 24 after closing below 1.0200 last week. Today’s drop has reached as low as 1.0133, but the market bounced to test 1.0150. At the moment of writing, the USD/CAD is down at 1.0143 (-0.29% on the day).
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