Rate picked up an early bid tone

GBP/USD

Range: 1.6247 – 1.6290

Support: 1.6200

Resistance: 1.6330

Rate picked up an early bid tone as yen crosses pushed higher ahead of the Tokyo fix, cable taken to a session high of $1.6278. Post fix reversal in yen crosses eased cable back to lows of $1.6245. Rate was seen tracking euro-dollar moves as the cross pivoted stg0.8900. Cable recovered in line with euro-dollar through the balance of the overnight session, spiking on to $1.6292 ($1.6295 61.8% $1.6330/1.6238) into early Europe before easing back to $1.6275. Offers said to remain in place from $1.6292 through to $1.6300, with further interest placed toward $1.6310 ($1.6308 76.4%). A break above this latter level to open a move toward $1.6330. Failure will keep the underlying tone bearish. UK employment data at 0830GMT. Support seen at $1.6250/45, with stops placed on a break of $1.6238.

USD/JPY

Range: 83.50 – 84.27

Support: 83.50

Resistance: 85.00

Opened at Y83.57 and jumped higher on cross buying led by the aussie-yen and strong demand from a Japanese securities company. The dollar rallied to Y84.17, before easing off to Y83.83 as another large tremor hit the North of the country and settled around Y84.00. The aussie-yen jumped from Y87.21 on the “toshin” fixing demand to a high of Y88.28, before falling back to Y87.47 as speculators then sold, but later picked up again to Y88.32 on hawkish comments from Fed’s Fisher, which led the dollar up to a high of Y84.26. Euro-yen tracked the aussie-yen up to Y121.99 from opening levels of Y121.00, but again stalled at Y122.00 where offers lay. All-in-all a bit of a mixed session but the yen complex marginally weaker on the morning as traders search for direction after the hefty sales in commodities over the last 24 hours.

Precious Metals

Precious metals have held up well despite a more broadened sell-off in other commodities such as oil, copper and cotton. The dollar weakness has continued to keep Gold and Silver firm despite some paring back yesterday, and look to continue higher as MENA concerns persist. Gold traded up to $1467.40 before some profit taking and a falling crude price led the metal down to $1444.20, but recovered to close around $1453 and has now picked up in Asia this morning to $1458.75. Silver dipped below $40.00 to a low of $39.72 but rallied into the NY close at $40.10 and has legged higher to $40.56 in Asia this morning. The trends remain bullish for both metals but regular bouts of profit taking are likely at these higher levels. Support for Gold is seen at $1444 and Silver at yesterday’s low of $39.72.

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