Yen falls versus dollar, euro in London

The yen hit a 3-1/2 month low versus the dollar on Friday and a two-month low versus the euro as hopes Greece would secure a second bailout lifted appetite for risk, further undermining the Japanese unit after monetary easing by Japan earlier this week.
Hopes of a Greece deal on Monday that would stave off a disorderly default kept the euro well above three-week lows against the dollar. Analysts expected the single currency could gain even further early next week, both versus the dollar and the yen, once euro zone officials give their seal of approval to a Greek bailout.
"If on Monday officials find a solution to the Greek issue the euro could react positively and go up towards $1.33, though not beyond $1.34," said Asmara Jamaleh, currency strategist at Intesa Sanpaolo. "But this doesn't mean the euro is going to rise higher in the following months. The euro faces macroeconomic problems in the euro area and a Greek solution won't mean the euro starts an upward trend".
The euro rose 0.5 percent to hit a high of 104.35 yen on EBS trading platform, its strongest since mid-December, while it gained 0.2 percent versus the dollar to $1.3161, well above Thursday's low of $1.2974. The yen continued to weaken after the Bank of Japan surprised markets this week by boosting its asset buying scheme by $130 billion.
The dollar rose 0.5 percent to a 79.24 yen on EBS, the highest level since October 31 when Japan sold a record 8.07 trillion yen in currency intervention after the dollar hit a post-World War Two record low of 75.311 yen. This left it in sight of the post-intervention high on October 31 at 79.553, though traders reported offers at 79.30/50.
"A move above 80-82 yen is probably in sight and then we would look at reducing our short yen positions slightly ," said Dagmar Dvorak, investment manager at Barings Investment Management, which has total assets under management of around $47.5 billion. The dollar breached its 200-day moving average earlier this week and its next major resistance is seen around the 79.73 to 80.94 yen area, a range formed by the cloud on the weekly Ichimoku chart, a popular technical analysis tool. The yen also hit a 6-1/2 month low versus the Australian dollar and a three-month low against sterling.