Daily FX Rambles

Andy Harrison

Good morning,

NYK Close

USDJPY 79.017 | EURUSD 1.27804 | EURJPY 100.998 | AUDUSD 0.98413 | NZDUSD 0.7564 | USDCAD 1.0222 | EURCHF 1.20119 | USDCHF 0.9397 | GBPUSD 1.58192 | EURGBP 0.80789

 

Weekend News

G8:

G-8 Leaders Affirm ‘Interest’ in Greece Remaining in Euro
Obama Said Growth and Jobs Must Be Top G-8 Priority

There seems to be a split now over austerity vs. growth, I wonder where that came from
EUR: EU Leaders Say Bloc Will Act as Needed to Combat Debt Crisis
EU Ministers Doubtful About Greek Euro Membership, Spiegel Says
New Democracy Placed Ahead of Syriza, Two Greek Polls Show
Schaeuble Says Germany Open for Hollande’s Ideas, Bild Reports
Merkel Says Euro Needs ‘Solid’ Fiscal Policy, Growth Initiatives
German Metalworkers Agree on 4.3% Wage Deal With Employers
Saccomanni Says There Is ‘Gigantic Deleveraging’ in Europe
Monti Plans European Guarantee on Bank Accounts, Corriere Says
Spain Plans Public Job Cuts in 2013 Budget, Cinco Dias Says
Italy Bomb Kills Student, Injures Several at Brindisi School
EUR/GBP:

Osborne Says U.K. is facing ‘Enormous Risks’ From Eurozone
CNY:

Premier Wen Says China to Focus More on Growth, Xinhua Reports
CNY/USD:

Chinese Activist Chen Thanks U.S. After Arriving in New York
AUD: Australia Labour Party Support Falls to 23% in Queensland: Poll
Queensland Shrinks Australia Coal Port Expansion as Demand Falls
Australian Budget Prices Shrinking Euro-Area Economy, Swan Says
USD/JPY:

U.S. Asks Japan to Reduce Car Taxes for TPP Talks, Asahi Says
JPY:

Osaka Mayor Wants Nuclear Restart for Summer Only, Nikkei Says

 

FX Opening Levels

Bid          Offer    NY Close
USD/JPY  79.01 |  79.1 |  78.92
EUR/USD 1.2748 | 1.2759 |  1.2782
EUR/JPY 100.72 | 100.92 | 100.86
AUD/USD 0.9833 | 0.984 | 0.9844
NZD/USD 0.7552 | 0.757 | 0.7564
USD/CAD  1.021 | 1.0224 | 1.0222
EUR/CHF 1.20103 | 1.20118 | 1.20115
USD/CHF 0.9395 | 0.9452 | 0.9397
GBP/USD 1.5795 | 1.5839 | 1.5817
EUR/GBP 0.8041 | 0.808 | 0.80807

Harry Hindsight

·         EUR: Having moved out of Asia on its lows and pushing towards 1.2640 early morning real money was seeing taking up some of the slack then comments from Hollande the new French PM speaking in favour of recapitalising Spanish banks seemed to be enough to turn the tide as we wait for more news out of Greece, Merkel suggested they hold a referendum on the Euro however, the interim government said it was beyond its remit and that was the end of that, Euro’s continued to push up through the remainder of the session causing a minor short squeeze through 1.2740 to finish just off the 1.2791 high into the close.

·         GBP: While EUR/GBP continued to move higher on continuing comments from the BoE and the PM, it didn’t stop the pound from rising against the USD as it tag along on the Euro rise moving from a low of 1.5731 to eventually top out around the 1.5835 level before seeing profit taking come in on the close and sell it back slightly.

·         AUD: While pretty much everything was rallying against the USD one of the exceptions was the Oz, still under pressure due to economic weakness in China and Europe affecting the export market and indirectly beginning to touch on the domestic market, it managed to initially rise as the Euro moved up, but sellers moved into the market through the IMM market leading it back below the 0.9820 level for a rangy close  still down on the day but unable to make much space to the downside having broken 0.9800 during Asia.

·         JPY: JPY failed to do much during London staying in a 79.20/42 range for the most part having been sold initially into this range during Asia, but as each session opened there seemed to be more inclination for safe haven buying of the JPY against AUD/EUR/USD sending it lower test 79.00, as we saw from the comments on Thurs/Friday, the powers that be have already started there verbal intervention, even if at the moment the market has ignored it the fact that EUR/JPY was looking to penetrate 100.00, only  a lack of news from Greece kept it at bay,

Yesterday’s premiership results

Actual = A | Consensus = C | Previous = P | Revised = R 

EUR        German PPI M/M Apr A                0.20% | C 0.40% | P 0.60%           

EUR        German PPI Y/Y Apr A 2.40% | C 2.60% | P 3.30%              

CAD       CPI M/M Apr A 0.40% | C 0.30% | P 0.40%           

CAD       CPI Y/Y Apr A 2.00% | C 1.90% | P 1.90%               

CAD       BoC CPI Core M/M Apr A 0.40% | C 0.30% | P 0.30%        

CAD       BoC CPI Core Y/Y Apr A 2.10% | C 1.90% | P 1.90%                                                    

For today

USDJPY
Topside : 79.80-80.10 (small buy stops)
Downside : 78.95-78.65 (light staggered sell stops) 78.60-78.25 (good bids) EURUSD
Topside : 1.2800 -1.2825 (mixed bag dominated by buy stops)
Downside: 1.2750-1.2700 (decent staggered bids) 1.2620 -1.2600 (Weak Sell Stops)

EURJPY
Topside: 101.10-101.50 (light mixed bag) (101.40 Weak Buy stops) AUDUSD:
Topside: 0.9855-0.9885 (marginal offers)
Downside: 0.9820-0.9740 (medium sized evenly spaced sell stops)

 

·         EUR: Opened as expected down from the previous close on Friday as split over austerity and growth shone through as the only nearly conclusive thing they could come up with in between coffee and tea. But with no real news on the Eurozone situation having gapped lower the market open, Asia was willing to buy the rumour of Greece leaving the Euro, but staying within the Eurozone, not sure why this would help anyone, unless they believe that would mean Greece paying back their debt in the next few generations. Having opened around the 1.2750 area it moved sideways until Asia opened properly then finding rumour buys to above 1.2810 before finding sellers appearing, that put the market off and liquidity dried up and a slow drift back below 1.2800 and down into the 1.2780’s towards London.

·         GBP: Similar story as the Euro, the Rightmove figure had very little impact on the market, stopping on the initial fall at 1.5793 market then slowly pushed up to the 1.5830 level and then traded 28/35 for the rest of the session with very little going through.

·         AUD: Still struggles however, the movement upwards in Euro’s seemed to alleviate some of the economic concerns over the effects of China and Europe but with no direct news market struggled.

·         JPY: Stayed in a tight range with very little going on, opened moving higher and topping out at 79.25 before drifting lower to 79.10 not quiet the low from the open but close enough and that defined the range for the day.

·         Overall seems to be the calm before the storm as everyone seems to have stepped back to see things develop rather than make rash decisions.

23:01     GBP       Rightmove House Prices M/M May A 0.00% | P                 2.90%

4:30        JPY         All Industry Activity Index M/M Mar A -0.30% | C -0.10% | P -0.10%        

Today’s data

Consensus = C                              Previous = P

5:45        CHF        SECO Consumer Confidence Apr               C -15 | P -19       

 

Ranges as of 6am London time

                             High | Low

USD/JPY             79.27 | 79.06

EUR/USD             1.2813 | 1.2745

EUR/JPY             101.42 | 100.86

AUD/USD             0.9876 | 0.9803

NZD/USD             0.762 | 0.7542

USD/CAD             1.023 | 1.0184

EUR/CHF             1.20129 | 1.20101

USD/CHF             0.94224 | 0.9375

GBP/USD            1.584 | 1.5795

EUR/GBP            0.80895 | 0.8058

 

Good luck and have a good weekend

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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