Daily FX Market Commentary

Andy Harrison

Good Morning,

LMAX Close

USDJPY 109.59 | EURUSD 1.1131 | AUDUSD 0.69169 | NZDUSD 0.65108 | USDCAD 1.35192 | USDCHF 1.00808 | GBPUSD 1.26263 |

LMAX highs and Lows 05.00 GMT

                                Highs | Lows

EURUSD               1.11432 | 1.11314

USDJPY                 109.678 | 109.477           

GBPUSD               1.26379 | 1.26176

USDCHF               1.00840 | 1.00724

AUDUSD              0.69314 | 0.69155

USDCAD               1.35203 | 1.35082

NZDUSD               0.65262 | 0.65104           

EURCHF                1.12332 | 1.12123

EURGBP               0.88253 | 0.8811

EURJPY                 122.232 | 121.954

For Today

• GBP: A very quiet session overall with the market moving around the 1.2630 area for the most part with a minor test through to the low 1.2920’s before rising and testing to the grey hour holding the 1.2635 area, limited congestion through the 1.2700 level and into the 1.2750 area before some sentimental offers appear, a move towards the 1.2800 will likely see some resistance but a mote through the 1.2820 areas is likely to see some weak stops and the market opening through to weak offers around the 1.2850 level and then stronger offers then appearing on any attempt to the 1.2900 areas. Downside bids light through to the 1.2650 area however, from there congestion is likely to appear in increasing size through to the 1.2600 level with strong stops likely on a push through the figure area to test towards the 1.2550 level and another round of stronger bids.
• JPY: Opening around the 109.55 the market gyrated around the level testing through and basing on the 109.50 areas and then rallying through to the 109.65 area into the grey hour in very limited volumes, Downside congestion down through the 109.50 level and increasing as the market moves towards the 109.00 areas, with a break of the 108.80 level likely to trigger weak stops but running into stronger congestion on any dips through to the 108.50 areas and increasing into the 108.00 level. Topside offer into the 110.00 likely to be weak with weak stops possibly opening the market to a quick move through to the 110.50 areas before stronger congestion moves in and increasing into the 111.00 level with strong stops a possibility on a move through.
• AUD: A slow rise through to the 0.6930 areas from the opening just above the 0.6915 level in very limited volume, Topside offers 0.6940-60 areas and likely increasing through the 0.6980-0.7000 levels, downside bids into the 0.6850 area likely to be more sentimental than anything else, stronger bids into the 0.6800 areas with sentimental values likely to show stronger bids on any push lower.
• EUR: Very narrow range with very little change on the day through to the grey hour, opening around the 1.1134 level and testing a little through the 1.1140 area before holding around that level through to the grey hour, Downside bids into the 1.1140 level with only a little opening before stronger bids appear through to the 1.1100 areas and likely to continue to the 1.1080 area before weak stops appear and the market opens a little through to the 1.1040 level and better bids reappear for any attempt at the 1.1000 level, topside offers into the 1.1220 area with possibly stronger stops on a push through the level however, above is likely to be congested and any move towards the 1.1300 is likely to be more of a grind through the levels

 

 

Overnight News

USD:

USD rises as investors seek safety DJ

Industry standards association drops Huawei from journals FT

Did Mueller just make a China deal impossible Zero Hedge

Mueller hints he has blocked from charging president with obstruction of justice in damning resignation – IND

GBP:

7% Separates Brexit scenarios, US FX report BI

UK car production plunges amid untold damage of Brexit chaos – GUA

EUR:

A dim view of the world Will Merkel be followed by darkness Spiegel

Italy to activate its parallel currency in defiant riposte to EU ultimatum -Tel

CNY/USD:

China unsheathes rare-earth dominance in trade war Nikkei

Peoples Daily warns US not to act arbitrarily on trade BBG

Taking aim at US, China says provoking trade disputes is naked economic terrorism – HAA

AUD:

ScoMo painted into corner on fiscal stimulus MB

Australia’s Capital expenditure may have remained soft in 1Q BBG

Fitch: Australia’s growth at decade low despite desynchronised cycles

NZD:

NZ National party leader calls on treasury secretary to resign BBG

Bridges also says Finance Minister Robertson must also resign BBG

Bridges says Nationalist obtained budget information by web search BBG

OIL:

API reports US Crude stocks dropped 5.27M BBL last week BBG

CAD:

Loonie tests key triangle after BOC decision – BBG

 

Today’s Data

Actual A | Consensus C | Previous P | Revised R | all timings GMT/UTC

NZD       Building Permits M/M Apr A -7.90% | P -6.90% | R -7.40%

AUD       Private Capital Expenditure Q1 A -1.70% | C 0.50% | P 2.00% | R 1.30%

AUD       Building Approvals M/M Apr A -4.70% | C 0.00% | P -15.50% | R -13.40%

12:30     CAD       Current Account Balance Q1 C -17.9B | P -15.5B

12:30     USD       GDP Annualized Q/Q Q1 (S) C 3.10% | P 3.20%

12:30     USD       GDP Price Index Q1 (S) C 0.90% | P 0.90%

12:30     USD       Initial Jobless Claims (MAY 25) C 214K | P 211K

12:30     USD       Continuing Claims (MAY 18) P 1676k

12:30     USD       Advance Goods Trade Balance Apr C -72.0B | P -71.4B

12:30     USD       Wholesale Inventories M/M Apr (P) C 0.10% | P -0.10%

14:00     USD       Pending Home Sales M/M Apr C 0.50% | P 3.80%

14:30     USD       Natural Gas Storage P 100B

15:00     USD       Crude Oil Inventories P 4.7M

23:01     GBP       GfK Consumer Confidence May C -12 | P -13

23:30     JPY         Unemployment Rate Apr C 2.40% | P 2.50%

23:30     JPY         Tokyo CPI Core Y/Y May C 1.20% | P 1.30%

23:50     JPY         Industrial Production M/M Apr (P) C 0.20% | P -0.60%

23:50     JPY         Retail Trade Y/Y Apr C 1.00% | P 1.00%

 

Harry Hindsight

 

• GBP: Very limited day but a tendency to the downside, opening around the 1.2655 level the Asian session saw a quiet range with the market basing on the 1.2650 level and rising through to the grey hour pushing towards the 1.2665 level before dipping firmly through to the 1.2630, the market held that low for the most part and the move into the NYK session saw the market gradually clawing itself to the days highs and the 1.2670 level before dropping quickly back with more confusion for the Conservative leadership and future PM and the Cable dropped back quickly and tested through to the 1.2615 levels before slowly rising to trade to the 1.2630 area for a long run to the close.
• JPY: Basing for the most of the day along the 109.20 levels opening with the market moving around the 109.35 area, the run through the Asian session saw the market unable to fully push through the 109.40 level and dipping through to the 109.15 area before forcing its way back to the highs again and tightly ranging tightly into the final run to the grey hour and a slow push through to the London session holding the 109.20 areas again, a slow recovery through the London session and a tight range through to London’s close before moving quickly off the lows and pushing through the 109.50 area the market eventually pushed into the latter part of the day testing the 109.70 before holding quietly to the close.
• AUD: Very limited range for the day with the market trading in a tight range through the Asian session, opening around the 0.6925 level the market dipped into Tokyo to test the 0.6920 level and then rising through to the 0.6930 areas to define the Asian range, grey hour selling saw the market pushing gradually to the 0.6910 areas through into the first hour of London before holding for a short period and a slow recovery through to the NYK opening, NYK sold quickly back through the opening levels and eventually pushed the market through to the lows for the London close, with London out of the way the market recovered slowly through towards the 0.6920 area before the close.
• EUR: Asia was quiet with the market ranging from the 1.1160 area opening through to just above the 1.1170 level to post the high of the day, holding around the 1.1165 area through to the grey hour and early selling from east Europeans sent the market through to the London opening pushing through the lows to the 1.1150 area and holding for and extended period through to the NYK session and the market again drifting through to the 1.1140 level before dipping quickly on the NYK option cut to the 1.1125 area and holding quietly through to the close just off those lows.

 

Yesterday’s Premiership results

NZD       RBNZ Financial Stability Report                                                 

GBP       BRC Shop Price Index Y/Y May A 0.80% | P 0.40%

NZD       ANZ Business Confidence May A -32.0 | -37.5

EUR        French GDP Q/Q Q1 (F) A 0.30% | C 0.30% | P 0.30%

CHF        KOF Economic Barometer May A 94.4 | C 96.2 | P 96.2

EUR        German Unemployment Change (000’s) May A 60K | C -8K | P -12K

EUR        German Unemployment Claims Rate May A 5.00% | C 4.90% | P 4.90%

EUR        ECB Financial Stability Review                   

CAD       BoC Rate Decision A 1.75% | C 1.75% | P 1.75%

 

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