The dollar romped as far as 118.09 yen

Good morning from Hamburg and welcome to our latest Daily FX Report. President Barack Obama will outline a plan on Thursday to relax U.S. immigration policy and grant relief from deportation to as many as 5 million undocumented immigrants in a go-it-alone move that will deepen a partisan divide with Republicans. The White House said Obama will deliver a televised speech on Thursday night laying out the plan followed by a trip to Las Vegas on Friday to build support. Nevada is home to the highest proportion of undocumented immigrants in the country.

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Market Review – Fundamental Perspective

The yen slid on Thursday, striking seven-year lows against the dollar and a six-year low versus the euro as speculators poured into carry trades funded by a tide of super-cheap liquidity from the Bank of Japan. The dollar romped as far as 118.09 yen, which is close to its weekest level since August 2007. Last month the BOJ announced its surprise stimulus steps on the market which lead to losses for the JPY. Likewise, the euro shot to 148.05, having gained 1.1 percent on Wednesday and more than 10 yen in 14 sessions. With the market focused on the yen, the euro moved only marginally on the U.S. dollar, edging up to $1.2553 EUR and shy of resistance around $1.2600. There was more action in the EUR/CHF cross, where the euro popped higher after on opinion poll showed a majority of voters were against a proposal to make the Swiss central bank buy more gold. Another gainer was sterling, which firmed half a cent to $1.5680 after minutes of the Bank of England's last meeting were not as dovish as many expected. The Canadian dollar weakened against its U.S. counterpart on Wednesday after the U.S. Senate narrowly failed to pass a bill late on Tuesday that would have approved construction of the controversial Keystone XL pipeline. The currency briefly pared losses on a weaker U.S. dollar after the Federal Reserve's October meeting minutes showed policymakers had wrestled with whether addressing the global economic slowdown and market volatility would overstate its concerns. The Canadian dollar, which analysts expect will continue to trend weaker against the greenback, finished the session at C$1.1351, or 88.10 U.S. cents, down from Tuesday's close of C$1.1299, or 88.50 U.S. cents.

Daily Technical Analysis

EUR/GBP (Daily)

After the GBP was able to appreciate and reached the resistance line at 0.8034, the currency sharply declined untill it reached the support line at 0.7796 where it rebounded twice. At the moment the currency pair is experiencing an upward movement but all indicators suggest that this trend may come soon to an end as the resistance at 0.8034 seems to be to hard to break.

Support & Resistance (Daily)

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