Daily FX Rambles

Andy Harrison

Good morning,

NYK Close

USDJPY 80.189 | EURUSD 1.2729 | EURJPY 102.071 | AUDUSD 0.99359 | NZDUSD 0.77024 | USDCAD 1.00717 | EURCHF 1.20105 | USDCHF 0.94361 | GBPUSD 1.59927 | EURGBP 0.79592

 

Harry Hindsight

·         EUR moved up after a tight range in Asia kept it above the 1.2800 level, good results in German GDP however, French GDP came in as expected at 0% and Italian figures fell 1.3% to below expected even so the market respected the German numbers over everything else, the selloff appeared as the NYK data started to be released comfortable CPI figures all in line with expectations, but manufacturing data was a big plus and inventories moved lower indicating the US economy is beginning to pick up, and a USD move started, added to uncertainties in Europe had the Euro moving from above 1.2865 level tumbling initially through the 1.2800 stopping around the 1.2770 level before moving lower in stages as other data fed through, finally holding above the 1.2720 level with EUR/CHF bids holding the market in play.

·         GBP while Cable in particular has been bucking the trend and not moving to the beat of the Eurozone in the same light as the EUR, today was a change with US data being the focus of the market Cable started to drop from above 1.6110 highs in the early London session pushing steadily lower as EUR recouped some of yesterday’s losses in the EURGBP cross, then add to which the data cable stayed in a steady drop throughout the NYK session moving to below 1.6000 before finding support in the 1.5990 level where it held into the close, this being the break out point to the top opens up the downside for GBP.

·         AUD the charts seem to suggest a similar pattern to the EUR with early movement higher moving back above the parity level from the 0.9948 low in Asia topping out around the 1.0010 level before trading in a tight range 10 tics either side of parity until the US data tipped it lower again moving sharply down to the upper 0.9950 levels and holding between there and 0.9980 for several hours before further late session selling moved into the market dropping it down to the 0.9920 levels for new yearly low. USDJPY followed pretty much the same scenario as the previous day up until the data release which then saw

·         USDJPY break above the 80.00 level and push higher peaking just above 80.30 taking out some of the importer levels and leaving the market open for further moves higher, it settled back into the close but looked fairly comfortable above the level. USD data dominated but bids in EURCHF and concerns about the EURJPY levels managed to put a lid on any out of control moves with talk of large bids in particular being seen in EURCHF.

Yesterday’s premiership results

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

05:00    JPY      Consumer Confidence Household Apr A 40 | C 40.9 | P 40.3       

05:30    EUR     French GDP Q/Q Q1 (P) A 0.00% | C 0.00% | P 0.20%   

06:00    EUR     German GDP Q/Q Q1 (P) A 0.50% | C 0.10% | P -0.20% 

08:30    GBP     Visible Trade Balance (GBP) Mar A -8.564B | C -8.400B | P -8.772B | R -8.590B

09:00    EUR     Eurozone GDP Q/Q Q1 (A) A 0.00% | C -0.20% | P -0.30%         

09:00    EUR     German ZEW (Economic Sentiment) May A 10.8  | C 19.4 | P 23.4           

09:00    EUR     German ZEW (Current Situation) May A 44.1 | C 38 | P 40.7       

09:00    EUR     Eurozone ZEW (Economic Sentiment) May A -2.4 | C 11.7 | P 13.1          

12:30    USD     CPI M/M Apr A 0.00% | C 0.10% | P 0.30%        

12:30    USD     CPI Y/Y Apr A 2.30% | C 2.30% | P 2.70%         

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

12:30    USD     CPI Core Y/Y Apr A 2.30% | C 2.30% | P 2.30% 

12:30    USD     Empire State Manufacturing May A 17.09 | C 8 | P 6.56  

12:30    USD     Advance Retail Sales Apr A 0.10% | C 0.20% | P 0.80% 

12:30    USD     Retail Sales Less Autos Apr A 0.10% | C 0.20% | P 0.80%          

13:00    USD     Net Long-term TIC Flows Mar A  36.2B | C $19.4B | P $10.1B      

14:00    USD     Business Inventories Mar A 0.30% | C 0.50% | P 0.60%  

14:00    USD     NAHB Housing Market Index May A 29 | C 26 | P 25                   

For today

USDJPY
Topside : 80.40-80.85 (light offers)
Downside : 79.70-79.40 (mixed bag with a slight bid tone)

EURUSD
Topside : 1.2750-1.2795 (decent offers) 1.2800-1.2830 (mixed bag with an offered bias)
Downside : 1.2725-1.2675 (good staggered sell stops) 1.2655-1.2620 (small bids)

EURJPY
Topside: 102.90-103.20 (light buy stops)
Downside: 102.10-101.70 (marginal sell stops) 101.55-101.35 (more decent sell stops) AUDUSD:
Topside: 0.9960-0.9990 (light mixed bag with a neutral bias)
Downside: 0.9920-0.9900 (good sell stops)

 

CNY:

China’s ‘Big Four’ state-run banks have issued almost no new yuan loans in first two weeks of May

PBoC monthly data shows that MoM change of position of FX purchase in April is -60.6 bn CNY,
which means PBoC net sold around 9.62 bn USD to inter-bank market last month.

COMD:

Commodity prices retreated across the board as USD moves higher

EUR:

Greek depositors withdrew some €700mln from local banks over the course of Monday. In the light of over the past 2yrs the average monthly flow has been in the region of 2-3bn reaching 5bn in Jan you can see how 1 day was excessive to the extreme.

JPY:

Industrial production seems to be on the increase as leading indicators start to pick up.

·         EUR had a steady day up until  late in the session as opportunists triggered small knock out options through 1.2700 having briefly moved down through the level it traded back to the 1.2715 level before settling down again for the most part early trading was dominated around the 1.2730 level not varying more than 8 tics either side the line.

·         GBP drifts lower as it moves into the old range with stop losses attracting attention below 1.5920, otherwise trading in line with the EUR.

·         AUD, with USD fairly strong AUD was pulled lower, commodity prices also beginning to weight on the currency and we only just held above the 0.9900 level as EUR made its move below 1.2700, for the moment having attempted to move higher above the 0.9950 and failed the downside looked more attractive.

·         USDJPY remains bid having cleared out near term importer offers moving steadily up from the 80.16 area to 80.44 before sticking to a 8 tic range around the 80.40 level for several hours.

23:50    JPY      Machine Orders M/M Mar A -2.80% | C -3.30% | P 4.80% | R 2.80%

23:50    JPY      Tertiary Industry Index M/M Mar  A -0.60% | C -0.30% | P 0.00% 

0:30      AUD     Westpac Consumer Sentiment May A 0.80% | P -1.60% 

Today’s data

Consensus = C                              Previous  = P

8:30      GBP     Jobless Claims Change Apr C 4.9K | P   3.6K    

8:30      GBP     ILO Unemployment Rate (3M) Mar C 8.30% | P 8.30%    

9:00      EUR     Eurozone CPI Y/Y Apr C 2.60% | P 2.60%         

9:00      EUR     Eurozone CPI – Core Y/Y Apr C 1.50% | P 1.60%           

9:00      CHF      ZEW Expectations May P 2.1   

9:00      EUR     Eurozone Trade Balance (EUR) Mar C 4.3B | P 3.7B       

9:30      GBP     BoE Inflation Report                                         

12:30    CAD     Manufacturing Shipments M/M Mar C 0.50% | P -0.30%  

12:30    USD     Housing Starts Apr C 678K | P 654K      

12:30    USD     Building Permits Apr C 735K | P 747K    

13:15    USD     Industrial Production Apr C 0.50% | P 0.00%      

13:15    USD     Capacity Utilization Apr  C 78.90% | P 78.60%    

14:30    USD     Crude Oil Inventories C 1.5M | P 3.7M               

Ranges as of 6am London time

                             High | Low

EUR/USD             1.2738 | 1.26986

USD/JPY             80.45 |   80.16

EUR/JPY             102.38 | 102.07

USD/CHF             0.9457 | 0.943

GBP/USD            1.5997 | 1.5957

AUD/USD             0.9949 | 0.9905

NZD/USD             0.7697 | 0.7648

USD/CAD             1.0101 | 1.0064

EUR/CHF             1.2013 | 1.2010

EUR/GBP            0.79705 | 0.7958

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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