Monday morning open, January 31st

Last day of the year and the market is relatively quiet awaiting more developments in the US fiscal cliff negotiations. Agreement on some sort of stop-gap measures still seems like the most likely outcome (just like last time) but if no deal is reached then we will see some heavy selling of the Yen crosses in my opinion. No market moving headlines are expected before 00:00 GMT.

Profit taking was the main theme on Friday with EUR/JPY falling almost 150 pips in a very short period of time and other pairs like EUR/GBP also seeing significant profit taking in thin markets.

Other markets were fairly quiet all round and all movement today will depend on headlines out of Washington. Many traders who would normally have the day off are active this morning.

USD/JPY opened 15 pips below its NY closing level from Friday but has bottomed out so far near 85.80. The other majors are hardly moving.

Good luck today.


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