Dollar loses some ground on the back of comments from UAE central bank

CURRENCY TRADING SUMMARY
U.S. Dollar Trading (USD) trimmed losses against the majors in the overnight foreign exchange trading session after a robust housing report helped the greenback. New home sales came in at 1.047mln compared to 1.018mln forecasted. In other markets, the Dow Jones index rose 102pts and the NASDAQ climbed 17pts as the Dow makes new all time record high as investors rushed to equity markets ahead of holidays for end of year. Crude oil rose US5c to US$60.39 in light trading. Looking ahead, Chicago PMI is due out tonight.

The Euro (EUR) traded within a low of 1.3095 and a high of 1.3178, before closing at 1.3128 in the New York session. On the data front, UAE central bank announced that they will be converting 10% total fx reserves to Euros and will be buying on dips for the next 9 months.

The Japanese Yen (JPY) traded within a low of 118.28 and a high of 119.22 versus the dollar, before closing at 118.69 in the New York session. Looking ahead, PMI manufacturing is due out tomorrow.

The Sterling (GBP) traded within a low of 1.9528 and a high of 1.9633, before closing at 1.9570 in the New York session.

The Australian Dollar (AUD) traded within a low of 0.7816 and a high of 0.7860, before closing at 0.7843 in the New York session. 

Gold (XAU) fell by US40c to US$629.90 an ounce in thin trading. 

Euro 1.3110
Initial support at 1.3089 (Dec 26 corrective low) followed by 1.3052 (Dec 18 corrective low). Initial resistance is now located at 1.3186 (61.8% retracement of the 1.3246 to 1.3089 decline) followed by 1.3247 (61.8% retracement of the 1.3368 to 1.3052 decline).

Yen 118.90
Initial support is located at 118.22 (Dec 22 low) followed by 117.44 (Dec 15 low). Initial resistance is now at 119.24 (Dec 26 high) followed by 119.67 (Oct 24 corrective high).

Pound – 1.9560
Initial support at 1.9516 (Dec 26 corrective low) followed by 1.9434 (Dec 18 corrective low). Initial resistance is now at 1.9751 (Dec 20 corrective high) followed by 1.9849 (Dec 1 trend high).

Australian Dollar – 0.7850
Initial support at 0.7774 (50% retracement of the 0.7614 to 0.7933 advance) followed by 0.7769 (Former resistance from Nov 1). Initial resistance is now at 0.788 (Dec 19 high) followed by 0.7897 (Dec 13 corrective high).

Gold – 628
Initial support at 618.2 (Dec 21 low) followed by 612.17 (Dec 18 corrective low). Initial resistance is now at 629.6 (Dec 26 high) followed by 638.1 (Dec 8 high).