TOKYO (Reuters) – The euro sat tight on Friday, showing some resilience after bouncing off trading-range support, while the dollar paused after oversold U.S. Treasuries gained a bit of ground, taking the benchmark yield off this week’s highs.

The dollar’s failure to push through the top of this month’s trading ranges against the euro and yen has left the market in consolidation mode as operations wind down for the year-end, although many in the market doubt the euro’s troubles are over.

The euro has tested support in the $1.3165-80 band several times in the past week while the dollar has repeatedly failed to break cleanly above 84.50 yen since late November, in spite of higher yields on the back of improving economic data.

Indicators on Thursday showed new U.S. claims for jobless aid fell last week and factory activity in the mid-Atlantic region grew at its quickest pace in more than 5- years this month.

“The data should be seen as mildly dollar positive but (we) will need to see bond yields respond more strongly to threaten the $1.3160-80 area of support on euro/dollar,” Alan Ruskin, global head of G10 FX strategy at Deutsche Bank, said in a client note.

The euro stood at $1.3248, unchanged from late U.S. levels and in the lower half of its $1.3164-1.3500 trading range of the past two weeks.

Sell-stops are said to be building at $1.3160 and chartists say a break through the range-bottom support level would put the euro on a path to $1.3110-1.3090 and possibly its November low of $1.2969.

TOKYO, Dec 16 (Reuters) – The euro steadied on Thursday ahead of an EU summit but looked vulnerable to further falls, while the dollar held near the top of recent ranges against several major currencies but lacked energy to vault them.

Trading conditions have become choppy as the year-end approaches, making it hard to take directional bets, although a surge in U.S. yields has boosted the dollar across the board, and took it to a three-month high of 84.51 yen JPY= on Wednesday.

Treasury prices edged up on Thursday and the dollar paused, helping the euro hold just above the bottom of a range it has kept since the start of the month, ahead of an EU summit set to discuss the euro zone debt crisis.

“The move above 84.41 yen should be a bullish sign for the dollar/yen but it does depend on U.S. yields,” said Masafumi Yamamoto, chief FX strategist at Barclays in Tokyo.

“The euro area still faces peripheral problems … If contagion spreads to Portugal, then who’s next?”

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Euro zone graphic package: r.reuters.com/hyb65p

TOKYO, Dec 13 (Reuters) – The euro slipped on Monday, looking set to remain in its downtrend for now, while the dollar edged up, supported by higher Treasury yields after improving U.S. data late last week.

The euro has been under steady pressure in recent weeks on concerns over debt levels in peripheral euro zone states, and many in the market expect that pressure to remain, with some looking for a re-test of this month’s low at $1.2969.

There was talk of a mixture of automatic stop-loss sell orders and take-profit orders on the euro in the $1.3165-80 area, just below the day’s low of $1.3182 EUR=, and then euro bids at $1.3150 and more sell stops below that.

Currency speculators trimmed short positions against the dollar last week but more than doubled their bets against the euro, according to data from the Commodity Futures Trading Commission, signalling growing bearishness on the currency. [IMM/FX]

“Euro positioning made a determined incursion into short territory last week, for the first time since early September, suggesting the escalating sovereign debt saga continues to take its toll,” wrote Gareth Berry, a FX strategist at UBS in Singapore.

A trader at a Canadian bank cautioned, however, that if the market was too heavily short on the euro at this point there was a risk of a short-covering rebound.

On the charts, resistance was expected up at $1.3280.

TOKYO, Dec 13 (Reuters) – U.S. Treasuries tumbled in Asia on Monday, driving up their 10-year yields to a new six-month high as Japanese investors kept dumping Treasuries on the spectre of higher growth and higher deficits in the United States.

The short end of the market is increasingly under pressure as the yield on two-year notes US2YT=RR also rose to a near six-month high and federal fund rate futures prices <0#FF:> started to price in the chance of a possible rate hike by the Federal Reserve in 2012.

That is a sea change from just over a week ago, when comments by Fed chief Ben Bernanke prompted debate among traders over whether the central bank will adopt another round of easing after its current $600 billion debt purchase programme expires next June.

The 10-year yield US10YT=RR rose to as high as 3.39 percent, from around 3.32 percent in late U.S. trade on Friday and breaking above a 61.3 percent retracement of its May-November fall at 3.37 percent that some market players had eyed.

U.S. T-bond futures prices TYv1 also broke a 61.8 percent retracement of their rally this year at 119-27.5/32 as the March futures fell 24.5/32 to 119-15/32.

“The fact that Treasuries have been sold quite often in Asian trade these days suggests that some Japanese investors are now eager to offload U.S. Treasuries as soon as possible,” said Tomoaki Shishido, a fixed-income analyst at Nomura Securities.

Japanese investors had bought a massive 22 trillion yen ($262 billion) of foreign bonds for the 27 straight weeks until November, a large part of them thought to be in Treasuries.

TOKYO, Dec 13 (Reuters) – The euro slipped on Monday, looking set to remain in its downtrend for now, while the dollar held steady, supported by higher Treasury yields after improving U.S. data late last week.

The euro has been under steady pressure in recent weeks on concerns over debt levels in peripheral euro zone states, and many in the market expect that pressure to remain with some looking for a re-test of this month’s low at $1.2969.

There was talk of a mixture of automatic stop-loss sell orders and take-profit orders on the euro in the $1.3165-80 area, just below the day’s low of $1.3182 EUR=, and then euro bids at $1.3150 and more sell stops below that.

Currency speculators trimmed short positions against the dollar last week but more than doubled their bets against the euro, according to data from the Commodity Futures Trading Commission, signalling growing bearishness on the currency. [IMM/FX]

“Euro positioning made a determined incursion into short territory last week, for the first time since early September, suggesting the escalating sovereign debt saga continues to take its toll,” wrote Gareth Berry, FX strategist at UBS in Singapore.

A trader at a Canadian bank cautioned, however, that if the market was too heavily short euros at this point, there was the risk of a short-covering rebound.

On the charts, resistance was expected up at $1.3280.

TOKYO (Reuters) – The euro slipped on Monday, looking set to remain in its downtrend for now, while the dollar held steady, supported by higher Treasury yields after improving U.S. data late last week.

The euro has been under steady pressure in recent weeks on concerns over debt levels in peripheral euro zone states, and many in the market expect that pressure to remain with some looking for a re-test of this month’s low at $1.2969.

One trader reported a mixture of automatic stop-loss sell orders and take-profit orders on the euro in the $1.3165-80 area, just below the euro’s trading rate of $1.3200, but with talk elsewhere in the market of more sell stops in that area.

Currency speculators trimmed short positions against the dollar last week but more than doubled their bets against the euro, according to data from the Commodity Futures Trading Commission, signaling growing bearishness on the currency.

“Euro positioning made a determined incursion into short territory last week, for the first time since early September, suggesting the escalating sovereign debt saga continues to take its toll,” wrote Gareth Berry, FX strategist at UBS in Singapore.

The trader cautioned however that if the market was too heavily short euros at this point, there was the risk of a short-covering rebound.

European Union leaders meet later this week.

TOKYO, Dec 9 (Reuters) – U.S. Treasury prices rose in Asia on Thursday and futures edged up as the market found some support after a steep two-day sell-off, with some saying the benchmark yield could start to stabilise around 3 percent.

The benchmark 10-year note yield US10YT=RR rose 40 basis points in two sessions after a deal in the U.S. to extend tax cuts sparked concern about inflation and fiscal deterioration.

The yield hit its highest in six months at 3.330 percent on Wednesday but fell to about 3.238 percent on Thursday, and one senior trader expected the correction to continue a little further, with 3.30-3.35 percent expected to be a ceiling for now.

But the market is reassessing the U.S. economic outlook as a result of the plan, which includes the tax cut extension and other measures, and against a backdrop of gradually improving economic data.

“If the economy keeps growing, although it might be a moderate pace, the right level for the long-term interest rate is maybe 3 percent plus,” said Akihiro Nishida, senior fixed-income strategist at Mitsubishi UFJ Morgan Stanley Securities.

“The movement might be a bit quick, too quick, for the market but the current level is not so out of touch.”

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TOKYO/SINGAPORE, Dec 8 (Reuters) – The dollar firmed and looked set to climb further on Wednesday, having powered up across the board the day before on the back of a spike in U.S. bond yields, while the euro slippped towards some significant support levels.

The greenback rose sharply on Tuesday, gaining 1 percent on the yen and rising against the likes of the Australian dollar after U.S. Treasury yields surged on a proposed extension in U.S. tax cuts, which fuelled concerns about inflation and the cost of the massive debt burden.

The dollar pressed home its advantage in Asia, nearing 84.00 yen JPY= and pushing the euro within range of support levels just above and below $1.3200 EUR=.

The rise in yields and widening in yield spreads is broadly seen as dollar supportive near-term, despite the fiscal concerns, while the U.S. economy stands to get a boost from the tax deal, which could lift growth next year and also lessen the case for bigger monetary stimulus from the Federal Reserve.

“It could be that the market is somewhat buoyed for now by the fact that the U.S. growth outlook for 2011 at least will probably be a lot better than what we all thought a couple of weeks ago,” said Sue Trinh, senior FX strategist at RBC.

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For analysis on US tax deal [ID:nN07277043]

TOKYO (Reuters) – The dollar on Monday recouped some ground lost from a renewed focus on U.S. quantitative easing, and was helped by short covering, while the euro fell back toward channel support ahead of a meeting of European finance ministers.

The greenback pulled up off a three-week low against the yen and two-weeks lows against the euro set on Friday after disappointing U.S. jobs data and a report that Federal Reserve Chairman Ben Bernanke did not rule out bond purchases beyond those planned.

The comments, which were then aired on Monday, served as a reminder that the Fed’s second round of quantitative easing, in which it plans to buy $600 billion in assets, remains a weight on the greenback, although the resulting easy liquidity is supportive of risk trades.

As the dollar shed 1.5 percent against the yen on Friday and more than 1 percent against a basket of currencies, it had scope for a bounce in thin volume on Monday, analysts said. It rose 0.5 percent to 82.93 yen, climbing off Friday’s three-week low of 82.52 yen, and it gained 0.4 percent on the index.

Still, just as euro zone debt concerns return periodically to dog the euro, U.S. asset-buying will haunt the dollar.

“The market is going to continue to view U.S. quantitative easing as being a driving force,” said Greg Gibbs, FX strategist at RBS in Sydney.

Bernanke said it could be four to five years before the U.S. returned to a more normal jobless rate but that a double-dip recession was not likely.

TOKYO (Reuters) – The dollar sat at its lowest levels for a couple of weeks on Monday, nursing large losses from weaker than expected employment data and renewed focus on U.S. quantitative easing.

Federal Reserve Chairman Ben Bernanke was reported in an interview with CBS television as not ruling out further bond purchases beyond the $600 billion already announced, helping take the dollar to its lowest in three weeks against the yen on Friday, and two weeks against the euro.

“The market is going to continue to view U.S. quantitative easing as being a driving force,” said Greg Gibbs, FX strategist at RBS in Sydney.

Bernanke appears on CBS’s “60 Minutes” show at 0000 GMT and Gibbs said the suggestion he would say he was prepared to do more was keeping the dollar on the back foot.

The dollar was trading at 82.71 yen, up 0.2 percent from late U.S. trade and just above Friday’s three-week low of 82.52 yen. It lost 1.5 percent against the yen on Friday.

The euro was holding just below a two-week high of $1.3438, having risen 1.5 percent on Friday.

Data on Friday showed the U.S. economy added fewer jobs than expected in November, driving the jobless rate up to 9.8 percent.