Daily FX Market Commentary

Andy Harrison

Good Morning,

LMAX Close

USDJPY 106.437 | EURUSD 1.10795 | AUDUSD 0.67562 | NZDUSD 0.63667 | USDCAD 1.33028 | USDCHF 0.98374 | GBPUSD 1.22534 |

LMAX highs and Lows 05.00 GMT

                                Highs | Lows

EURUSD              1.10857 | 1.10609

USDJPY                106.621 | 106.411

GBPUSD              1.22648 | 1.22226

USDCHF               0.98550 | 0.98344

AUDUSD             0.67637 | 0.67449

USDCAD              1.33241 | 1.32947

NZDUSD              0.63962 | 0.63671

EURCHF               1.09096 | 1.08989

EURGBP              0.90512 | 0.90378

EURJPY                118.164 | 117.895

For Today

  • GBP: As with most of the week through Asia, a little rise initially from the 1.2250 level and then slipping back from the highs around 1.2260 areas drifting through to the grey hour testing the 1.2230 level, Topside offers look to be light through the 1.2300 areas before weak stops appear and the market likely to find limited offers until the 1.2350 areas where stronger offers are likely to appear, downside bids congested back through the 1.2200 levels with particular strength on any dips to the 1.2140 level onwards and through to stronger bids below 1.2100 areas.
  • JPY: A steady recovery from yesterdays 106.40 level and rising steadily through to the 106.50 area before jumping quickly through the 106.60 level before slowing and ranging between 106.50-60 to the London session, Downside bids likely to be weak through to last week’s 105.00 area with strong bids likely to continue through to the 104.80 area before strong stops are likely to appear for a push steadily through into the 103 handle and the ranges from the end of 2016. Topside offers light through to the 107.50 areas with possible sellers still remaining as Japanese continue to reset their investments away from contentious areas a push through the level will likely to see congestion appearing above the level and limited ability to move.
  • AUD: Limited day for the Oz with the market trading around the opening 0.6760 areas with only one stab lower in the session lightly penetrating the 0.6750 level before bouncing back and moving back into the holding level around the opening, Downside bids likely through the 0.6720 level and then increasing as the market moves towards the 0.6680 area with possible strong stops through the  level opening a deeper move with limited congestion around the sentimental areas, topside offers light through to the 0.6820-30 areas before weak stops appear and limited congestion for a move to the 69 cents level and stronger offers.
  • EUR: Opening around the 1.1080 level early trading was quiet before moving into the Tokyo session and steady selling appeared with one way traffic through to the 1.1060 level for the move into the grey hour, Downside congestion around the 1.1050 level with stronger bids on a push to the 1.1020-00 areas before limited bids appear through to the 109.80 and stronger stops appearing and minor support through the 1.09 handle. Topside offers through to the 1.1120 area before some weak stops appear and the market opens to the 1.1140-60 areas and stronger congestion and increasing offers on any push to the 1.1180 level.

 

 

Overnight News

KRW/USD:

  1. Korea ForMin: US secretary of State Pompeo casts a dark shadow over US-N. Korea talks- KCNA

ForMin: Pompeo has more interest in his own political ambitions than current US Foreign policy KCNA

ForMin: We have given enough time to the US

ForMin: We are ready for both dialogue and confrontation KCNA

Formin: It will be a miscalculation if US continues with sanctions KCNA

ForMin: We can remain the biggest threat to US for a long time KCNA

NZD:

RBNZ Governor Orr Unconventional policy is far from our central scenario

Orr: Negative rates can be impactful tool broadly across economy

Orr: Will see what situation like in Nov, will cut if necessary

Orr: Inflation expectations is important signal to watch

Orr: We can afford to wait, watch and observe what’s happening

Orr: We will do whatever it takes to support NZ economy

Orr: Rate cut reduces probably of having to do more later

EUR/USD:

German-US ties are breaking down Spiegel

European Bonds spooked by ECB’s concern about kindling inflation BBG

EUR:

Bundesbank sees no need for fiscal stimulus in Germany right now – BBG

USD:

US mall foot traffic growth continues, but decelerates – BBG

Trump could get impeachment boost, poll shows BBG

Fed’s regional presidents lining up against additional rate cuts – BBG

GBP/EUR:

Angela Merkel will cave and agree a series of Brexit side deals Daily Mail

Macron pours cold water on Johnson’s optimism over Brexit deal – BBG

 

Today’s Data

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

NZD       Retail Sales Ex Inflation (QoQ) (2Q) A 0.2% | C 0.2% | P 0.7%

JPY         National Consumer Price Index (YoY) (JUL) A 0.5% | C 0.5% | P 0.7%

JPY         National Consumer Price Index Ex-Fresh Food (YoY) (JUL) A 0.6% | C 0.6% | P 0.6%

JPY         Natl CPI Ex Fresh Food, Energy (YoY) (JUL) A 0.6% | C 0.5% | P 0.5%

USD        Annual Federal Reserve Policy Symposium in Jackson Hole (Day 2)

11:00     MXN      Economic Activity IGAE (YoY) (JUN) C -0.58% | P -0.43%

12:30     CAD       Retail Sales (MoM) (JUN) C -0.3% | P -0.1%

14:00     USD        Fed Chair Powell Speaks at Jackson Hole

14:00     USD        New Home Sales (MoM) (JUL) -0.2% | P 7.0%

17:00     USD        Baker Hughes U.S. Rig Count (AUG 23) P 935

 

 

Harry Hindsight

 

  • GBP: A quiet Asian session saw the market rising a little through to the 1.2130 levels but really failing to move in any meaningful direction until the market moved into the London session, London saw the market dipping away through to the 1.2110 area before finding support available and pushing off the lows as weak EUR numbers saw the market moving higher through to the 1.2150 level and holding in the narrow range through to the NYK session, A quick move higher with Euro’s under pressure and unflattering PMI numbers manufacturing numbers and Cable quickly broke higher with weak stops through the 0.9100 level on the EURGBP cross dropping a quick 50 pips before slowing and Cable rushing through the 1.2200 level testing to the 1.2250 areas and ranging around the level through to the end of the session testing just above the 1.2270 levels before drifting to a close.
  • JPY: Opening around the 106.60 levels the market drifted through the early part of the Tokyo session initially pushing through towards the 106.65 level the market dipped from midsession onwards to the 106.40 area holding through into the London session before testing to 106.30, the market based along this level through to the NYK session with a limited stab towards the 106.25 area before starting a steady rise through to the NYK opening pushing back to the opening level, a little nervous around the US numbers and choppy trading between the days 106.30-60 range before settling into trading around the 106.40 just off the lows to the close.
  • AUD: A steady drift from the opening with the market initially testing a little higher however, the market was unable to push through the 0.6790 area and the market came under pressure as the USDJPY sellers moved in and AUDJPY led the Oz lower through to the 0.6760 level and basing in a tight range deep into the NYK session US numbers squeezed USDJPY a little lower triggering some further AUDJPY selling before holding around the 0.6760 area again through to the close just off the lows of the day.
  • EUR: A choppy day but limited range for the Euro with the market rising only to the 1.1090 level into the Tokyo session before steadily drifting through to the London session testing the 1.1080 area, while the bunch of saw moderate gains the markets push above the 1.1100 level was quickly reversed as German companies signal a looming recession after demand plunges and quickly pushed through into the mid 1.1060’s before stabilising and slowly moving to the 1.1080 area and trading around the level through to the end of the session.

 

Yesterday’s Premiership results

AUD       CBA Australia PMI Manufacturing (AUG P) A 51.6 | P 51.6

AUD       CBA Australia PMI Services (AUG P) A 49.2 | P 52.3

AUD       CBA Australia PMI Composite (AUG P) 49.5 | P 52.1

USD        Annual Federal Reserve Policy Symposium in Jackson Hole (Day 1)

JPY         Nikkei Japan PMI Manufacturing (AUG P) A 49.4 | C 49.4 | P 49.4

JPY         All Industry Activity Index (MoM) (JUN) A -0.8% | C -0.8% | P 0.3% | R 0.5%

JPY         Machine Tool Orders (YoY) (JUL F) A -33.0% | P -33.0%

CHF        Industrial Output w.d.a. (YoY) (2Q) A 4.8% | P 4.3% | R 4.5%

EUR        Markit France Manufacturing PMI (AUG P) A 51 | C 49.5 | P 49.7

EUR        Markit France Services PMI (AUG P) A 53.3 | C 52.5 | P 52.6

EUR        Markit France Composite PMI (AUG P) A 52.7 | C 51.8 | P 51.9

EUR        Markit/BME Germany Manufacturing PMI (AUG P) A 43.6 | C 43.0 | P 43.2

EUR        Markit Germany Services PMI (AUG P) A 54.4 | C 54.0 | P 54.5

EUR        Markit/BME Germany Composite PMI (AUG P) A 51.4 | C 50.6 | P 50.9

EUR        Markit Eurozone Manufacturing PMI (AUG P) A 47.0 | C 46.2 | P 46.5

EUR        Markit Eurozone Services PMI (AUG P) A 53.4 | C 53.0 | P 53.2

EUR        Markit Eurozone Composite PMI (AUG P) A 51.8 | C 51.2 | P 51.5

MXN      Bi-Weekly CPI (YoY) (AUG 15) A 3.3% | C 3.5% | P 3.7%

MXN      Bi-Weekly CPI (AUG 15) Medium A 0.1% | C 0.1% | P 0.1%

MXN      Bi-Weekly Core CPI (AUG 15) A 0.1% | C 0.2% | P 0.1%

EUR        ECB Publishes Account of Policy Meeting (JUL)

USD        Initial Jobless Claims (AUG 17) A 209k | C 218k | P 220k | R 221k

USD        Continuing Claims (AUG 10) A 1674k | P 1726k | R 1728k

USD        Markit US Manufacturing PMI (AUG P) A 49.9 | C 50.5 | P 50.4

USD        Markit US Services PMI (AUG P) A 50.9 | C 52.8 | P 53.0

USD        Markit US Composite PMI (AUG P) A 50.9 | P 52.6

USD        Leading Index (JUL) A 0.5% | C 0.2% | P -0.3% | R 0.1%

EUR        Euro-Zone Consumer Confidence (AUG A) A -7.1 | C -7 | P -6.6

 

 

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LMAX Exchange Market Commentary   Andy Harrison  

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LMAX Group will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. No representation or warranty is given as to the accuracy or completeness of the above information. While the produced information was obtained from sources deemed to be reliable, LMAX Group does not provide any guarantees about the reliability of such sources. Consequently any person acting on it does so entirely at his or her own risk. It is not a place to slander, use unacceptable language or to promote LMAX Group or any other FX and CFD provider and any such postings, excessive or unjust comments and attacks will not be allowed and will be removed from the site immediately.