FXstreet.com (London) - Early market reaction in the Asian session to Abi Dhabi agreeing to fund $10 billion to Dubai World caused a spike in Yen crosses. USD/JPY jumped over 25 points as the news came to market. This news will temper market fears and may swing market sentiment toward risk appetite as investors jostle to take position ahead of the FED policy revision tomorrow and Wednesday.
Summary of the Major dollar pairs as we approach the end of the Asian session looks like this: EUR/USD 1.4660/62 (+0.24%), USD/CHF 1.0321/23 (-0.18%), GBP/USD 1.6288/90 (+0.26%), USD/JPY 88.87/93 (-0.08%).
After Dubai news is digested, currency markets are likely to calm ahead of FED policy meeting, as we should get more detail on the state of the US economy as we head into Christmas.
For Swissy at this level we expect deeper downside correction, as indicated by the technicals. Valeria Bednarik, collaborator at FXStreet.com, elaborates:Consolidating in a tight range close to past Friday's highs, under 1.0320 expect some deeper downside corrections as hourly indicators are exhausted to the upside. Bearish movements should remain contained by 1.0240 support zone to be considered corrective, as bigger time frames support further rises for next sessions.