USD and JPY Open Weaker Again This Morning Following Yesterday’s Losses

• USD and JPY open weaker again this morning following both currencies across the board losses yesterday
• Gold opens higher this morning following yesterday’s reversal that saw price lift nearly $40 off earlier
• Greek coalition partners to meet again today to try and come to agreement over budget cut proposals as February 13th level looms
• EURUSD tests key technical levels again ahead of London opening
• USDJPY trades back above 77 as JPY sold multilaterally
• EURCHF looks to test 1.2115-20 resistance as price reaches highest level in past 10 trading days
• Asian equity markets higher across on the board on optimism over Greek deal
• News reports this morning that focus on Chinese potential investment in the EFSF helps lift EUR as equity markets move higher again

Good morning. The EURUSD has lifted again this morning after yesterday’s move above 1.32 triggered more short stops.

Yesterday the move out of the dollar and the Yen was started around 1pm as both currencies started to see some selling interest.

That saw the EURUSD lift from earlier lows around 1.3095, very quickly back over 1.3060 as unnamed Greek officials said that a deal had been reached between the coalition partners and a meeting would be scheduled for 7pm GMT.

That saw some serious stop loss buying kick in as the EURUSD edged through 1.3200.

The initial gains were hard fought because there were some serious Asian offers around that level. In the end it broke and the price traded towards the Fibonacci level at 1.3244.

However as the London close drew near this was broken too and the price raced quickly to the 1.3275-90 neckline level.

That held overnight and the price was struggling to make further headway when it was announced that there was in effect no agreement between the Greek coalition partners and the meeting was delayed until today.

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That sent the price sharply lower to 1.3225 but it held there again and pushed higher into the US close.

Leaving aside the Greek debacle I think one reason for the USD losing ground yesterday was the failure by Fed chairman Ben Bernanke to make any changes to his testimony from the other week, even his pre released comments were left unchanged; that it would seem was a bigger driver for risk than any prospect of a deal out of Athens.

Whilst the Fed Chairman maybe a realist it is also true that he’s only happy if the economy is depressed – it is his pet subject don’t forget.

Today’s comments from China, that they ‘may’ look to invest in the EFSF has had a positive impact on the markets in general and the EUR in particular.

The dollar and the JPY have been the main losers as all of the JPY crosses move to the right. The JPY is the second worst performer this morning behind the dollar and if the benign risk environment continues then that will most likely continue.

I am keeping the update as brief as possible this morning, because frankly there isn’t a great deal more to add other than what we know already.

The markets are anticipating good news out of Greece today, but that has been the case for months now and despite this recent move higher in the EURUSD I will wait and see what emerges, if anything from that arena again today.