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Dollar eases back around ¥101.50

JIJI

The dollar was easier around ¥101.50 in Tokyo trading Tuesday, on the back of a stock market pullback following recent rapid rises.

At 5 p.m., the dollar was at ¥101.47-48, down from ¥101.74-76 at the same time Monday. The euro was flat at $1.3539-3540. Against the Japanese currency, the European currency stood at ¥137.38-42, down from ¥137.76-83.

The greenback fell to as low as around ¥101.30 in the morning, with the key 225-issue Nikkei average getting off to a dismal start after rising near its year-to-date closing high the previous day.

As currency trading has been increasingly linked with stock prices recently, “there are growing concerns that the dollar has also risen too fast vis-a-vis the Japanese currency in a short period of time,” a foreign exchange broker said.

The dollar appears susceptible to selling to lock in profits now, because the U.S. market will be closed Thursday for Thanksgiving Day and many hedge funds are set to close their books at the end of this month, some analysts noted.

Still, the dollar’s downside was limited Tuesday as the Nikkei recouped part of its losses in the afternoon. The greenback was also supported by purchases from Japanese importers, traders said.

Meanwhile, an official at a major Japanese bank said, “It remains to be seen whether the yen has now been back on a weakening trend,” although the U.S. currency hit a six-month high slightly below ¥102 in Tokyo on Monday.

Market players are focusing on next week’s release of U.S. jobs data for November to see if the U.S. Federal Reserve will begin to scale back its quantitative easing policy before year’s end, an official at a major trust bank said.

  • http://www.forexabode.com/ Forex

    From the view of the price action, the break over 101.53 signified the bullish sentiments and indicate the possibilities for further gains beyond 102.00. The recent drop is still finding support near 5-day EMA and also by the fear of entering the 100.00 psychological ranges again. If support continues in the range of 100.90 to 101.00 then USD/JPY should move towards 102.40 soon as mentioned at http://bit.ly/1bTF9B6 also.