FOREX-Dollar steady in subdued trade, euro pauses

* Dollar index steady at 84.440 (.DXY: )

* Euro faces resistance near $1.2595 and $1.2620 (EUR=: )

* Trade subdued as U.S. markets holiday

* SNB’s Hildebrand says watching fx moves closely

(Adds quotes, updates prices, changes dateline prvs TOKYO)

By Tamawa Desai

LONDON, July 5 (BestGrowthStock) – The dollar steadied in subdued
trade on Monday after hitting a near two-month low against a
currency basket after soft U.S. jobs data late last week, while
the euro paused after hitting a six-week high.

Traders were wary of chasing the dollar lower given a U.S.
market holiday on Monday in observance of Independence Day.

Concerns about the U.S. economy mounted after Friday’s jobs
data showed weak private hiring, and capping a week of soft
economic figures.

“The dollar is responding more to weak signs in the U.S.
economy,” said Lee Hardman, currency economist at Bank of
Tokyo-Mitsubishi UFJ.

At 0723 GMT, the dollar index (Read more about the global trade. ), which tracks the performance
of the greenback versus a basket of six other major currencies,
was flat from late U.S. trade on Friday at 84.440 (.DXY: ). On
Friday, it fell to 84.132, its lowest since mid-May.

Short-term support is seen around 83.20, roughly a 38.2
percent retracement of the index’s move from a low of 74.17 in
November to a high near 88.71 in June.

The euro (EUR=: ) eased 0.1 percent to $1.2548, with support
seen around its 55-day moving average, currently near $1.2530.
Last week, the euro gained 1.5 percent against the dollar after
hitting a four-year low around $1.1875 in June.

It faced resistance near $1.2595, the bottom of the cloud on
daily Ichimoku charts, and then near $1.2620, a 38.2 percent
retracement of its drop from its March high near $1.3820 down to
its four-year low.

Options with strike price of $1.2500 expiring on Tuesday may
also cap movements, traders said.

Friday’s monthly jobs report showed the economy shed 125,000
jobs in June, while private payrolls rose less than expected.
Overall employment fell for the first time this year as
thousands of temporary census jobs ended.

The data followed a raft of weak reports that suggested U.S.
consumer spending, housing and factory activity were moderating.
[ID:nN01165161]

“Double-dip fears are the pervading influence on market
psychology at present even as European sovereign concerns appear
to be easing,” analysts at Credit Agricole CIB said in a note.

The dollar edged up 0.2 percent against the yen to 87.92
yen, pulling further away from a seven-month low of 86.96 yen
set last week, with some talk of dollar buying by Japanese
importers.

Data from the Currency Futures Trading Commission showed net
long yen positions jumped in the week to June 29. The value of
the dollar’s net long position slipped to about $9.5 billion in
the week ended June 29 from $12.2 billion in the prior week.
(IMM/FX: )

One-month implied volatility hovered near 12 percent
(JPY1MO=: ), down from around 13 percent last week as the dollar
slid to a 7-month low of 86.96 yen.

The Swiss franc held off from recent record highs against
the euro (EURCHF=: ) after the Swiss National Bank head said the
central bank was keeping a close eye on the currency.

“The currency fluctuations of the Swiss franc have indeed
picked up in the last weeks. The SNB is following these
developments on the foreign exchange market (Read more about international currency trading. ) very closely,” Swiss
National Bank chairman Philipp Hildebrand said in an interview
published on Swiss website blick.ch on Sunday. [ID:nLDE66309R]
(Additional reporting by Charlotte Cooper in Tokyo, editing by
Mike Peacock)

FOREX-Dollar steady in subdued trade, euro pauses