Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good Morning,

LMAX Close
USDJPY 110.719 | EURUSD 1.08537 | AUDUSD 0.66048 | NZDUSD 0.63554 | USDCAD 1.32129 | USDCHF 0.97902 | GBPUSD 1.29305

LMAX highs and Lows 06.00 GMT
Highs | Lows
EURUSD 1.08672 | 1.08453
USDJPY 111.039 | 110.651
GBPUSD 1.29420 | 1.29142
USDCHF 0.98034 | 0.97861
AUDUSD 0.66214 | 0.65994
USDCAD 1.32968 | 1.32807
NZDUSD 0.63577 | 0.6333
EURCHF 1.06340 | 1.06291
EURGBP 0.84001 | 0.83907
EURJPY 120.533 | 120.083

For Today
• GBP: A slow drift from the opening just below the 1.2930 level to test through the 1.2920 area before quickly rising through the 1.2940 area and holding tightly around the level to the grey hours, Topside offers light through the 1.3000 area likely to fall easily on a push through to the 1.3020 area and only stiffening once the market pushes the 1.3050 area with congestion likely and increasing on any move to push the 1.3100 level with likely stronger offers. Downside bids light through to the 1.2900 level with buyers likely to continue through to the 1.2850 with stronger congestion awaiting below the 1.2900 level and little in the way of stops for the moment.
• JPY: A limited day for the USDJPY, rising from the 110.65 level for the move into the 111.00 level for the Tokyo session, the market pushed a few times however, unable to break the level fully the market drifted back through to the 110.80 level in quiet trading for the move into the grey hours. Topside offers through to the 112.20 and increasing as it pushes too that area, weak stops likely on a test through the level and the market opening to the 112.50 level and then increasing size as any further movement appears through to the 113.00 level. Downside bids light through to the 110.00 level where limited congestion appears through to the 109.80 area, any pushes through to the 109.50 are likely to see stronger bids appearing and likely to continue through to the 109.00 level.
• AUD: Very quiet session for the Oz rising in the run to the Tokyo session from the opening just above the figure level and testing steadily through to the 0.6620 area where the market held quietly through to the grey hours with a light drift, weak offers through the 0.6650 area before stronger offers likely through the 0.6680 area and continuing through to the 0.6720 area with likely congestion limiting any damage that stops could create and that congestion continuing through to the 0.6780 level and stronger offers. Downside bids light through to the 0.6580 areas with strong bids into the level and then weak stops appearing likely in size through to the 0.6550 levels a failure here will open a further test through to the 0.6520-00 area before any significant bids are likely.
• EUR: A quiet run through to deep into the Tokyo session before lifting off the days low around the 1.0845 area to push slowly through into the upper 1.0860’s however, unable to push through the 1.0870 area the market started to drift for the move through to the grey hours, Downside bids light through into the 1.0785 area before stronger bids reappear in strength with weak stops possible through the level and opening a test through the congestion around the 1.0750 level and opening a test to the 1.0720 areas and stronger bids. Topside offers through to the 1.0860 level and although there could be some limited weakness the run to the 1.0880 is likely to be a struggler with weak stops likely through the 1.0920 if it can make it and an opening for limited topside movement,

Overnight News
CNY:
There’s a record stash of Steel in China as virus slams demand – BBG
CHF:
SNB likely stepped up battle against strong Franc last week – BBG
USD:
Clinical trial is expected to start in April, as epidemic originating in China spurs quick response – WSJ
Moderna ships mRNA vaccine against Novel Coronavirus – note Testing result lag – Business Wire
JPY:
History repeats as sales tax hike pushes Japan toward recession
BoJ to act appropriately with eye on markets – Senior Official

Today’s Data
Actual – A | Consensus – C | Previous – P | Revised R | all timings GMT/UTC
0700 EUR German GDP n.s.a YoY (4Q F) C 0.3% | P .3%
0700 EUR German GDP w.d.a. YoY (4Q F) C 0.4% | P 0.4%
1200 MXN Economic Activity IGAE YoY (DEC) C 0.52% | P -1.21%
1200 MXN GDP Full Year YoY (JUL 12) P 2.0%
1400 USD House Price Index MoM (DEC) C 0.40% | P 0.20%
1400 USD House Price Purchase Index QoQ (4Q) P 1.1%
1400 USD S&P CoreLogic CS 20-City MoM SA (DEC) C 0.40% | P 0.48%
1400 USD S&P/Case-Shiller Composite-20 YoY (DEC) C 2.85% | P 2.55%
1400 USD S&P/Case-Shiller US Home Price Index YoY (DEC) P 3.54%
1500 USD Consumer Confidence Index C 132 | P 131.67
1500 USD Conf Board Present Situation (FEB) P 175.3

Harry Hindsight

• GBP: Opening around the 1.2950 level the market held around the level through into midsession in Tokyo before dipping a little to base along the 1.2935 level through into the grey hours, a slow rise through to the highs around 1.2955 level before London opened and steady but strong selling saw the market test through the 1.2900 levels with a move to just above the 1.2885 area and ranging through to the NYK session around the 1.2900 level, NYK saw slow buying through to the end of London to take the market back to the 1.2935 area and ranged through to the close holding close to that area.
• JPY: Opening a little low the market moved through to the Tokyo Fix filling the gap and testing towards the 111.70 level and the high for day before holding quietly through to early morning in London basing along the 111.50 areas before sliding a little through to hold the 111.30 level holding in the area for the move into the NYK session before dipping as strong sellers moved in reminiscent of yesterdays moves to test through to the 110.50 level quickly before slipping through to trade the lows around the 110.30 area before bouncing and starting a slow climb through to the 110.75 area for the run to the close.
• AUD: Opening just off the days lows and steadily rising into the Tokyo session moving away from the 0.6590 level and testing towards the 0.6620 level for the first time, the initial run over with the market dipped back and based along the 66 cents level through to the grey hours, pushing through the 0.6600 level for the move through to early London the market ran tightly around the 0.6590 levels for several hours before rising back to the figure for the move into the NYK session with buying moving in only after a couple of dull hours and pushing back for a second and then a third run at the 0.6620 level each time failing before dipping back to the 66 cents area for the close.
• EUR: For the second day a similar pattern of movement, opening lower from Friday’s close, moving off the 1.0820 level the market steadily climbed through to the 1.0840 areas for the Tokyo opening however, once Tokyo was moved in the market started to drift testing back quickly to the opening then slowly drifted through to the London opening testing to the lows just above 1.0800 area to make the lows of the day, a slow recovery through early London saw the market spike a little higher triggering weak stops on a move back through the 1.0830 area to push to the 1.0840 areas before dipping back again and ranging around the 1.0820 through to the NYK session, and as yesterday early buyers appeared and started a strong push through to the 1.0850 filling the gap on the charts and slowly pushing through to the 1.0870 area to make the high for the day, having hit the highs late in the session the market fell back to the 1.0850 level again to hold quietly through to the close.

Yesterday’s Premiership results
NZD Retail Sales Ex Inflation QoQ (4Q) A 0.7% | C 0.8% | PB 1.6%
NZD Credit Card Spending YoY (JAN) A 3.7% | P 3.4% | R 3.5%
EUR German IFO Business Climate (FEB) A 96.1 | C 95.3 | P 95.9 | R 96.0
EUR German IFO Current assessment (FEB) A 98.9 | C 98.6 | P 99.1 | R 99.2
EUR German IFO Expectations (FEB) A 93.4 | C 92.1 | P 92.9
MXN Bi-Weekly CPI (FEB 15) A 0.12% | C 0.15% | P 0.11%
MXN Bi-Weekly CPI YoY (FEB 15) A 3.52% | C 3.55% | P 3.29%
MXN Bi-Weekly Core CPI (FEB 15) A 0.22% | C 0.28% | P 0.16%

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