• Krueger says US economy still weak.
  • Gordon Brown says will raise taxes on the rich and halve the deficit in four years.
  • Australian PMI falls to 48.5 in December.
  • Tokyo stock exchange lauches new trading platform, “Arrowhead”.
  • Singapore advance Q4 GDP +3.5% YoY, below expectations.
  • Feldstein says US may falter in 2010 because of lack of stimulus funding.
  • China HSBC December PMI at 56.1.
  • Asian bourses mostly flat except for Nikkei, up 1.1%.
  • Gold last at 1102.00

Yen cross selling was the order of the day today. Early Sydney was quiet until Japanese names started to appear, selling off USDJPY and EURJPY initially. This quickly flowed into other crosses with GBPJPY and AUDJPY under pressure by mid-morning. USDJPY was sold down from the 93.10 area after once again failing to move higher in Asia. Sellers towards 93.20 weighed on the market and it wasnt long before a push back to 92.70 was seen. EURJPY followed, slipping back thru the 100 and 200 day MA stopping to take a breather at 132.65-70. USD demand heading into the Tokyo fix saw USDJPY move from 92.70, back up above 93.00. But that demand subsided a couple of hours later with renewed Yen cross selling sending USDJPY and EURJPY back to sit on their supports at 92.70 and 132.40 respectively. Panic selling of USDTWD down thru 32.00 after the Central bank allowed the pair to move lower, also added to the afternoon USDJPY selling.

EURUSD never looked comfortable above 1.4300 today. The EURJPY selling was too much for EUR, sending it straight down thru 1.4300. The second wave lower was on the back of USD demand heading into the fix which EUR back to find some buyers ahead of 1.4250. Even then, the move back up has been limited to just below 1.4300. Seems traders will now wait for European manufacturing PMI data later on before making their next move.

Both AUD and GBP saw moves lower on the back off their Yen cross. GBPJPY retreated just over 100 pips to sit just above 149.00 and AUDJPY down towards 83.00 from 83.70. AUD Dec PMI fell short of expectation and back below the 50 which initially had no impact, but with the amount of AUDJPY selling out of Tokyo, US investment banks found the opportunity to jump on the selling wagon hitting it back below the morning support of 8970. It continued lowe,r stopping at the previous 8930 area to see a bounce back up to 8970.

Ranges:

EURUSD 1.4255 – 1.4332

GBPUSD 1.6069 – 1.6150

USDJPY 92.67 – 93.08

EURJPY 132.36 – 133.35

AUDUSD 8938 – 8997