Dollar off high in Asia

The dollar on Monday pulled away from a nine-month high hit on Friday as traders booked profits after the US currency rose nearly 8 percent in about a month. Traders said the dollar was ripe for some profit-taking following its strong gains. The dollar fell 0.6 percent versus the yen to 81.31 yen, retreating from a high of 81.873 yen on Friday on trading platform EBS, the weakest level for the Japanese currency since late May 2011.
As of Friday, the dollar had risen by about 7.7 percent from a three-month low hit near 76 yen in early February. On Monday, yen buying by offshore institutional investors also weighed on the dollar, which extended its losses after triggering some stop-loss sell orders at levels below 81.50 yen, traders said.
"There is perhaps a little more room for dollar/yen to go higher in the next few days, with short-term players now going short yen, but we see the upside limited," said Christopher Gothard, head of FX for Brown Brothers Harriman in Hong Kong. Bondholders have until March 8 to join the agreement under which they will exchange their existing Greek government bonds for new paper in a swap deal that will see the nominal value of their holdings cut by 53.5 percent.
Charles Dallara, managing director of the International Institute of Finance (IIF), the chief negotiator for the body representing private sector holders of Greek bonds, has expressed confidence that the deal will be completed successfully. The yen has been under pressure after the Bank of Japan's surprise monetary easing in mid-February, with its drop gaining momentum after breaching technical support levels.
Underscoring the recent shift in sentiment toward the yen, data showed currency speculators have turned short on the yen for the first time since May 2011, according to latest figures from the US Commodity Futures Trading Commission. Traders said the dollar's weekly close above a major retracement level in the 81.60-65 yen area was positive.
The next major hurdle is seen at the 100-week moving average around 82.10 yen or so. Support for the dollar lies near 80.89 yen on the weekly Ichimoku chart, a popular technical analysis tool. The euro inched up 0.1 percent to $1.3204, having touched a two-week low of $1.31806 at one point on Monday. Against a basket of currencies, the dollar rose to as high as 79.489 earlier on Monday, its highest level since mid-February.