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Forex pairs in this Article » USD/JPY (Barcelona) - The Asian session Friday has brought a major increase in selling intensity in the Yen – obviously related to stops being tripped. Technicians will be eyeing Friday’s close carefully for most of these crosses to see if the breakouts / downs hold. If they do, look out below for the Yen.

Talk of US harmony in budget negotiations plus better US data has tapering talk heating up

While the move Friday is modest thus far, the US Dollar is seeing more strength after Thursday’s bullish reversal. The upside is not only being driven by the wholesale dumping of the Yen, but corrective moves lower in the euro and the Pound. The move higher in the DXY is also being driven by traders and analysts theorizing on the Fed’s commencement of the QE-tapering program. They seem to be believing more in the idea that tapering may begin in December or January due to the recent strength in US data as well as to the visions of US Congressional Republicans and Democrats working together to come up with a working US budget.

Session Data Summary and Reactions

• New Zealand Business PMI came in showing m/m gains – NZD/USD sold off hard initially, then bounced and now is selling off again.
• Japanese Industrial Production numbers came out mixed – increasing on a Y/Y basis, but decreasing M/M –
USD/JPY drifting lower modestly after the data release, but that may simply be profit-taking following the sharp run higher Friday and in the previous weeks.

Main headlines in Asia:

USD/JPY aiming at stops 103.50+, exporter's hedging done?

Behind RBA Stevens headline, what was really said?

Gold hammered Thursday – finishing near session lows. 1210.10 going to be tested?

Analysts in Japan anticipate further BoJ easing - Survey

EUR/USD posts bearish reversal candle Thursday – may be time for a pullback

Flash: Budget deal passed, tapering imminent? - Rabobank

USD/JPY sets fresh 2013 highs
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