Equity markets in Asia were firmer overnight lending further support to the USD/JPY.

In my view the set-up for the weaker USD is about done for the week.

In my view, the past two-days of weakness in global stocks is a huge over-reaction to the potential of a handful of banks or finance companies threatened with failure or regulatory interference.

The USD is trading mixed to start New York after a two-way overnight session that saw the JPY crosses again the most active on the board.

The USD is mixed to lower today after concerns for Yen carry trade unwinds continued as well as a new potential bearish indicator developed: the sub-prime lending meltdown.

The USD is trading lower to start New York after falling off a bit in late European trade.

In my view, the USD is set to make solid highs for the near-term against GBP and EURO.

A case of “buy the rumor/sell the fact” appears to be active in the GBP and the EURO this morning as both the BOE and the ECB provided “as expected” fundamentals.

Initially starting firm in Asia the USD came under a bout of selling through Europe

The USD is on the defensive overnight as the major pairs continue to correct higher; USD/JPY is firmer as traders continue to debate the recent need for unwinding of Yen carry trades.