Daily Winners and Losers

Euro_Rally_To_Taper_Off_Japanese_Yen_Maintains_Range_body_ScreenShot035.png,

Currency

Last

High

Low

Daily Change (pip)

Daily Range (pip)

EURUSD

1.3714

1.3758

1.3637

2

121

Euro_Rally_To_Taper_Off_Japanese_Yen_Maintains_Range_body_ScreenShot036.gif,

The Euro extended the advance from earlier this week to reach a fresh monthly high of 1.3757, but the near-term rally appears to be tapering off as the relative strength index falls back from 70. The EUR/USD remains slightly higher on the day after moving 79% of its average true range, and we may see a correction unfold going into the Asian trade as price action breaks out of the upward trending channel from the monthly low (1.2873). In turn, the exchange rate should fall back towards the 120-SMA at 1.3678, but a break below the 240-SMA (1.3622) is likely to expose the 50.0% Fibonacci retracement from the 2009 high to the 2010 low around 1.3500 as it searches for support. As the advanced 4Q GDP report for the U.S. is scheduled to cross the wires tomorrow at 13:30 GMT, the faster pace of economic growth could produce a bearish reaction in the greenback, and the data could certainly provide the catalyst needed to see a breakdown in the EUR/USD as economic activity in the U.S. outpaces the recovery in Europe.

Key Levels/Indicators

Level/Indicator

Level

10-Day SMA

1.3533

50.0% Fib

1.3500

100-Day SMA

1.3481

Daily RSI

67

Upcoming Events

GMT

Importance

Release

Expected

Prior

0:30

LOW

Euro-Zone M3 s.a. (3M) (DEC)

1.6%

1.3%

0:30

LOW

Euro-Zone M3 s.a. (YoY) (DEC)

1.9%

1.9%

Currency

Last

High

Low

Daily Change (pip)

Daily Range (pip)

USDJPY

82.96

83.22

82.02

79

120

Euro_Rally_To_Taper_Off_Japanese_Yen_Maintains_Range_body_ScreenShot034.png,

The Japanese Yen tumbled lower against all of its major counterparts as Standard & Poor's lowered its credit rating for the world's third-largest economy, and the low-yielding currency may face additional headwinds over the coming months as the government struggles to balance the risks for the region. The USD/JPY remains nearly 80pips lower from the open after moving 158% of its daily ATR, but the exchange rate may consolidate going into the Asian trade as 30-minute RSI falls back from overbought territory. In turn, the dollar-yen should fill-in the gap from the 240-SMA at 82.53, but the exchange rate may trend sideways over the near-term as it maintains the narrow range from earlier this year. As a result, currency traders may take advantage of the range-bound price action in the USD/JPY, and the pair should trade within 81.80-83.70 going into February as the most of the daily moving averages (10, 20, 50, and 100) converge with one another.

Key Levels/Indicators

Level/Indicator

Level

50-Day SMA

83.07

100-Day SMA

82.86

20-Day SMA

82.59

10-Day SMA

82.56

Upcoming Events

GMT

Importance

Release

Expected

Prior

23:30

LOW

Tokyo Consumer Price Index (YoY) (JAN)

-0.2%

-0.2%

23:30

LOW

Tokyo Consumer Price Index Ex-Fresh Food (YoY) (JAN)

-0.3%

-0.4%

23:30

LOW

Tokyo Consumer Price Index Ex Food, Energy (YoY) (JAN)

-0.5%

-0.5%

23:30

MED

National Consumer Price Index (YoY) (DEC)

-0.1%

0.1%

23:30

MED

National Consumer Price Index Ex-Fresh Food (YoY) (DEC)

-0.5%

-0.5%

23:30

MED

National Consumer Price Index Ex Food, Energy (YoY) (DEC)

-0.8%

-0.9%

23:30

MED

Jobless Rate (DEC)

5.1%

5.1%

23:30

LOW

Job-To-Applicant Ratio (DEC)

0.58

0.57

23:30

MED

Household Spending (YoY) (DEC)

-0.6%

-0.4%

23:50

MED

Retail Trade s.a. (MoM) (DEC)

-1.4%

1.9%

23:50

MED

Retail Trade (YoY) (DEC)

0.6%

1.3%

23:50

MED

Large Retailers' Sales (DEC)

-0.5%

0.2%

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To discuss this report contact David Song, Currency Analyst: dsong@fxcm.com

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