Forex headlines for May 16, 2013

The economic data was bad for the US dollar and down it went. The dollar bears waiting on the sidelines finally had something to chew on but didn’t last as Williams’ comment on tapering sparked a dollar rebound and left EUR/USD and USD/JPY close to where they were at the start of the session.

USD/JPY nicked below yesterday’s low by a few pips, just enough to take out some weak longs. The low of the day was 101.83 and the turnaround was quick after European traders began to file out. USD/JPY snapped back to 102.30 and as been chopping in a 102.00/30 range.

EUR/USD climbed to 1.2930 slowly in early US trading from a low of 1.2847 in Europe but topped out at the European close, partly on a comment from a European Commission minister saying they prefer a lower euro. From there it dropped in two legs, first down to 1.2885 and then down to 1.2870 on the Williams comment.

Cable was an outperformer, shaking off a few days of malaise. It peaked at 1.5322 but fell hard on the Williams comment and was last at 1.5270.

The Australian dollar is clinging to the European low of 0.8139 at the moment. The late USD buying and weakness in stocks was a double-whammy for the languishing Aussie.