Daily FX Rambles

Andy Harrison

Good morning,

NYK Close

USDJPY 79.943 | EURUSD 1.29179 | EURJPY 103.264 | AUDUSD 1.00205 | NZDUSD 0.7829 | USDCAD 1.00041 | EURCHF 1.20116 | USDCHF 0.92986 | GBPUSD 1.60697 | EURGBP 0.80379

Weekend news

CNY:

China Lowers Banks’ Reserve Requirements to Support Growth
CNY/JPY/KRW:

China, Japan, South Korea Agree to Start Free-Trade Negotiations
EUR:

Greek President to Meet Party Leaders to Try to Form Government
Merkel’s Party Bids to Recapture Germany’s Most Populous State
ECB’s Patrick Honohan Says Greek Euro Exit Would Not Be ‘Fatal’
Greek Syriza Party Wants Left-of-Centre  Solution, Real News Says
Juncker Says Europe Should Renegotiate Greece Aid: DPA-AFX
Juncker Says Beefed-Up EIB Would Allow ‘Substantial’ Growth Push
EU Regulators Will Re-Examine ING’s Rescue by Dutch State
Spain May Need to Inject $6.4 Billion in Bankia, Expansion Say

French Prefer Francois Fillon as UMP Party Head, Poll Shows


JPY:

Shirakawa Urges Japan to Cut Deficit for Yen Stability: Asahi
USD:

Elizabeth Warren Calls for Dimon to Resign From New York Fed
JPMorgan’s Trading Loss May Call for More Fed Scrutiny
California Deficit Swells to $16 Billion, Governor Says
AUD:

Lending Profits to Keep Falling on Competition, NAB’s Clyne Says
Australians Losing From Budget Outnumber Winners, SMH Poll Says
GBP:

More Demands for Extra Tax Due to Errors at HMRC

 

Harry Hindsight

With weaker Chinese data setting the tone for the day, with German inflation ticking also meant Euro’s was stuck between a rock and hard place with option barriers standing down to the figure and sellers sitting pat above the 1.2950 level, so we had a reasonably quiet day with early buyers taking it away from 1.2900 only to see NYK selling into the meagre rally, for the range trader it was a nice day to play, market moved into the end of the session heading back to the lows. GBP played catch up moving steadily lower with input prices showing better numbers, indicating that the output should begin to fall in line in the near future, having stayed steady for the week in relation to the declines seen in the Euro some pull back was to be expected I suppose. AUD seemed to be in the same mood as the Euro with protection at the parity level but resting offers above 1.0070, after the selloff in late Asia and the dash to squeeze out the stop losses at the figure the market found a base just below the 1.0020 level holding as several attempts to get through were made, early NYK tried the same thing but also failed and we had a minor short squeeze occurring taking us back briefly above 1.0070 only to start drifting off in the remainder of NYK heading to the 1.0020 level into the close. USDJPY just over a 20 tick range moving from 79.73 to just below the 80.00 again selling in London which made the lows seemed to be AUDJPY going through so once the low was made and AUD started to move back up USDJPY went with it.

Yesterday’s premiership results

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

23:50    JPY      Japan Money Stock M2+CD Y/Y Apr A 2.60% | C 2.90% | P 3.00%         

01:30    CNY     CPI Y/Y Apr A 3.40% | C 3.40% | P 3.60%         

01:30    CNY     PPI Y/Y Apr A -0.70% | C -0.50% | P -0.30%      

05:30    CNY     Industrial Production Y/Y Apr A 9.30% | C 12.10% | P 11.90%    

05:30    CNY     Fixed Assets Inv YTD/Y Apr A 20.20% | C 20.40% | P 20.90%    

05:30    CNY     Retail Sales Y/Y Apr A 14.10% | C 15.10% | P 15.20%    

06:00    EUR     German CPI M/M Apr A 0.20% | C 0.10% | P 0.10%        

06:00    EUR     German CPI Y/Y Apr A 2.10% | C 2.00% | P 2.00%         

08:30    GBP     PPI Input M/M Apr A -1.50% | C             -0.90% | P 1.90% | R 1.70%

08:30    GBP     PPI Input Y/Y Apr A 1.20% | C 2.10% | P 5.80% | R 5.60%

08:30    GBP     PPI Output M/M Apr A 0.70% | C 0.40% | P 0.60%         

08:30    GBP     PPI Output Y/Y Apr A 3.30% | C 2.90% | P 3.60% | R 3.70%

08:30    GBP     PPI Output Core Y/Y Apr A 2.30% | C 1.90% | P             2.50%  

12:30    CAD     Net Change in Employment Apr A 58.2K | C 10.0K | P 82.3K       

12:30    CAD     Unemployment Rate Apr A 7.30% | C 7.30% | P 7.20%   

12:30    USD     PPI M/M Apr A -0.20% | C 0.00% | P 0.00%       

12:30    USD     PPI Y/Y Apr A 1.90% | C 2.10% | P 2.80%         

12:30    USD     PPI Core M/M Apr A 0.20% | C 0.20% | P 0.30%

12:30    USD     PPI Core Y/Y Apr A 2.70% | C 2.80% | P 2.90% 

13:55    USD     U. of Michigan Confidence May (P) A 77.8 | C 76.4 | P 76.4        

 

For today

USDJPY
Topside: 80.10-80.30 (light offers) 80.50-80.80 (light offers) 81.00-81.30 (light offers)
Downside: 79.60-79.80 (decent bids) 79.20-79.50 (medium sell stops) 78.60-79.00 (medium bids)

EURUSD
Topside: 1.2935-1.2950 (light offers) 1.2970-1.3000 (medium buy stops) 1.3010-1.3050 (light buy stops)
Downside: 1.2870-1.2885 (light bids) 1.2820-1.2850 (medium sell stops) 1.2780-1.2810 (decent sell stops) 

EURJPY
Topside: 103.50-103.80 (light buy stops) 103.90-104.20 (medium buy stops) 104.30-104.60 (decent buy stops) 
Downside: 102.70-103.00 (light bids) 102.20-102.50 (light bids) 101.50-101.80 (medium sell stops) 

AUDUSD
Topside: 1.0040-1.0080 (light offers) 1.0090-1.0120 (mixed net net light offers) 1.0130-1.0160 (medium offers)
Downside: 0.9950-0.9990 (light sell stops)

Increased talk in Europe about Greece, kept the pressure on Euro pre-market selling took the Euro lower just before the Asian market opened once the market opened it was dangerously close to the 1.2900 level and pushed through fairly easily and from there it was a struggle  to move back above touching 1.2903 but having now broken down through 1.2900 one suspects that resistance will appear any time it moves up above 1.2900. downside saw the market trade briefly below 1.2880 but support from the sentimentalists saw the 1.2880 pretty much hold. A lack of interest in GBP saw the pound dip no further than 1.6052 and barely scrape above 1.6075 for a narrow range an early move in EURGBP pushed the cross saw Gamma buyers picking up the selling. AUD opened slightly higher on the back of the RRR cut in China and immediately tried the down side and the support at parity however bids held and the market moved back above the 1.0030 level briefly before we saw another run lower this time we traded below the figure and then bounced which suggests that the sellers were taking out options and bought back immediately having triggered the options, moving slightly high but not making the previous highs. USDJPY finally moved through 80.00 as both Euro and AUD came under pressure but a narrow range 79.88/80.12, in quiet trading. USD seems to be under pressure as rumours abound on the JPM losses and possible further ramifications.

EUR: Greek president to continue coalition talks Monday-official

Greek Democratic Left Chief Reaffirms Proposal For All-Party Government

Greek radical left leader rejects coalition talks- official

Austerity blow for Merkel in German state election

Nobel Laureate in economics Paul Krugman see’s Greece’s exit as soon as next month

CNY:

China to relax QFII rules further-paper

USD:

JPMorgan CEO says bank reacted badly to red flags

Some secrecy needed in trade talks-USTR Kirk

JPY:

Japan PM Noda Doesn’t Rule Out Solo FX Intervention

Japan April wholesale prices fall 0.2 pct yr/yr

AUD:

Australia faces structural economic changes-RBA

Australian March Housing Finance +0.3% Vs February; Consensus -2.0%

NZD: New Zealand 1Q Retail Sales Data Show Spending Still Sluggish

NZ service sector activity rebounds in April – survey

NZD     Retail Sales Ex Inflation Q/Q Q1 A -1.50% | C -0.40% | P 2.20% | R 1.80%

JPY      Domestic Corporate Goods Price Index Y/Y Apr A -0.20% | C -0.20% | P 0.60% | R 0.50%

AUD     Home Loans Mar A 0.30% | C -1.70% | P -2.50%

Today’s data

Consensus = C                              Previous  = P

7:15      CHF      Combined PPI M/M Apr C 0.30% | P 0.30%       

7:15      CHF      Combined PPI Y/Y Apr  C -2.00% | P -2.00%     

9:00      EUR     Eurozone Industrial Production M/M Mar C 0.60% | P0.50%

Ranges as of 6am London time

                             High            Low

EUR/USD             1.2935                  1.28780

USD/JPY              80.127                   79.897

EUR/JPY              103.593                 102.99

USD/CHF             0.9327                   0.9300

GBP/USD            1.6080                   1.6054

AUD/USD            1.0070                  0.9996

NZD/USD            0.7856                  0.7795

USD/CAD            1.0023                  0.9989

EUR/CHF            1.2015                  1.2010

EUR/GBP            0.80345                0.8016

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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