Daily FX Market Commentary

Andy Harrison

Good morning,

NYK Close

USDJPY 79.737 | EURUSD 1.24675 | EURJPY 99.415 | AUDUSD 1.00794 | NZDUSD 0.79133 | USDCAD 1.02521 | EURCHF 1.20107 | USDCHF 0.96334 | GBPUSD 1.55651 | EURGBP 0.8010 |

 

Harry Hindsight

·         EUR: The Euro did pretty much nothing throughout the Asian and for the most part London session, not surprising really as Germany’s position becomes more isolated with the rest of Europe seemingly holding out the begging cup and Germany not wanting to put anything in all those cups, I mean Spain’s PM called for more fiscal and banking Union the day after they sold short dated bonds with coupons the size of 20yr Junk bonds attached. However, the market peaked at around the 1.2507/8 mark during Asia and that was the top for the day, the Asian low of 1.2480 held up until NYK walked in with mixed numbers coming out of the US the headline had to be orders almost double what was expected and USD rallied a little moving Euro’s down to test below 1.2450 but again as with earlier this week the 1.2440 level seemed strong and Euro’s moved back to trade into the 1.2470 area for the close.

·         GBP: Cable failed to hold its gains from the day before, it held during Asia and struggled in a range of 1.5620-30 during London, but the US numbers put it lower quickly trading to below 1.5550 before holding steady and then the rest of the session was a move to range 1.5560-70 until the close.

·         JPY: The USDJPY bottomed out during Asia holding 79.35 and moving higher slowly through until pre London when it started to rally on short covering topping above 79.60 dipped and continued into the NYK session making a high of 79.86 drifting back to the 79.70 into the close on the back of US figures.

·         AUD: No real direction pretty much the same as the Euro however, they’ve become detached for the moment and what worries Europe is not so telling on the AUD, saying that we initially moved lower in Asia to make the lows of 1.0040 area before finding some AUDJPY cross buying going through for the Tokyo fix moving it above 1.0060, up until mid-London we stayed in this range the fact everyone is looking at Europe as a total basket case is probably the reason that we started to see EURAUD selling taking us to above the 1.0085 level during London as those that wanted to take a punt, US figures came out and off came the AUD ignoring what had happened speculators bot USD against everything, those that sold the AUD though found themselves offside almost instantly and we had a minor short squeeze from 1.0055 area back to make a new high around the 1.0090, so it wasn’t the usual type of range but for this week it was respectable.

Yesterday’s premiership results

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

22:45     NZD       Trade Balance (NZD) May A 301M | C 300M | P 355M | R 335M

08:30     GBP       BBA Mortgage Approvals May A 30.2K | C 32.8K | P 32.4K | R 32.1K

10:00     GBP       CBI Reported Sales Jun A 42 | C 15 | P 21              

12:00     EUR        German CPI M/M Jun (P) A -0.10% | C 0.00% | P -0.20%

12:00     EUR        German CPI Y/Y Jun (P) A 1.80% | C 1.80% | P 1.90%       

12:30     USD       Durable Goods Orders May A 1.10% | C 0.50% | P 0.20%               

12:30     USD       Durables Ex Transportation May A 0.40% | C 0.70% | P -0.60%    

14:00     USD       Pending Home Sales M/M May A 5.90% | C 1.30% | P -5.50%     

14:30     USD       Crude Oil Inventories A -0.1M | C -0.7M | P 2.9M         

For today

USDJPY
Topside: 79.80-80.10 light buy stops 80.20-80.50 light offers 80.80-81.10 decent buy stops  81.20-81.50 light offers
Downside: 79.20-79.50 light bids 78.70-79.00 light bids 78.20-78.50 light sell stops 77.80-78.10 medium sell stops EURUSD
Topside: 1.2520-1.2550 mixed 1.2560-1.2590 medium buy stops
Downside: 1.2420-1.2450 medium sell stops 1.2380-1.2410 medium sell stops 1.2320-1.2350 light sell stops

EURJPY
Topside: 99.50-99.80 light offers 99.90-100.20 light buy stops
Downside: 99.00-99.30 light sell stops AUDUSD
Topside: 1.0130-1.0160 medium buy stops
Downside: 1.0020-1.0050 light bids 0.9970-1.0000 medium bids 

 

23:50     JPY         Retail Trade Y/Y May A 3.60% | C 3.00% | P 5.80% | R 5.70%

1:00        NZD       NBNZ Business Confidence Jun A 12.6 | P 27.1   

 

JPY:

Ozawa, Others to Submit Letters of Resignation From DPJ-Led Parliamentary Group

Japan PM support flat as ruling party splits on sales tax -poll

Japan funds push domestic weightings to record

Japan May Overall Retail Sales +3.6% On Year

AUD/CNY:

Australia in Talks With China to Set Up Offshore Yuan Market in Sydney – Report

CNY/USD:

Chinese paper slams U.S. candidates for playing “China card”

CNY: China May Introduce Preferential Tax Policy for Pension Funds this Year -Report

China to allow yuan conversion in Shenzhen financial zone

China government housing fund to expand bond investment -report

AUD:

Australia new homes sales edge up in May industry

Australia job vacancies fall in May qtr. – ABS

NZD:

NZ business confidence slips in June – NBNZ survey

 

EUR: Today was a day of stop loss chasing started by the Oz then the rest followed a steady rise from the mid 1.2460’s triggering some minor stops through 1.2500 before halting at the 1.2520 level, on pretty quiet trading again. The market continues to sit on the fence waiting for today’s EU summit which they are already not impressed with because we no its going to be another non-event.

GBP: moving steadily high on the back of general USD selling through stop loss chasing in the market, cable moved from the 1.5565 level eventually testing the 1.5600 before settling back to the 1.5590 level in the run to London reversing some of yesterday’s losses.

JPY: USDJPY drifted lower with a flat fixing we move away from the 79.75 area steadily lower to hit yesterday’s lows and settle into the 79.40 area

AUD: What data we saw bore no resemblance to the movement in the market, we moved from NYK at the 1.0080 level and for the first few hours there was nothing worth mentioning then we saw several rounds of buying appear in the market initially it looked like several banks had been lifted at the same time and there was a little bit of a scramble however, news filtering was that only a couple of banks were involved and the market triggered weak stops in the 1.0090-1.0100 area and then went further to try and get at another batch of weak stops above 1.0120 while we traded just through the level it would seem that offers kicked in and suppressed any further rises for the moment.

 

Today’s data

Consensus = C  Previous = P Timings GMT

7:55        EUR        German Unemployment Change Jun C 3K | P 0K              

7:55        EUR        German Unemployment Rate Jun C 6.70% | P 6.70%      

8:30        GBP       GDP Q/Q Q1 (F) C -0.30% | P -0.30%       

9:00        EUR        Eurozone Consumer Confidence Jun (F) C -19.6 | P -19.6              

9:00        EUR        Eurozone Economic Confidence Jun C 89.6 | P 90.6          

9:00        EUR        Eurozone Industrial Confidence Jun C -12 | P -11.3          

9:00        EUR        Eurozone Services Confidence Jun C -6 | P -4.9 

12:30     USD       GDP (Annualized) Q1 (F) C 1.90% | P 1.90%         

12:30     USD       GDP Price Index Q1 (F) C 1.70% | P 1.70%            

12:30     USD       Initial Jobless Claims C 385K | P 386K      

14:30     USD       Natural Gas Storage P 62B           

 

Ranges as of 6am London time

                                Highs   Lows

USD/JPY               79.75 | 79.33

EUR/USD             1.25248 | 1.2468

EUR/JPY               99.478 | 99.16

AUD/USD            1.0126 | 1.0073

NZD/USD             0.7964 | 0.7911

USD/CAD             1.0252 | 1.0232

EUR/CHF              1.2013 | 1.20101

USD/CHF             0.96325 | 0.95921

GBP/USD             1.5598 | 1.5568

EUR/GBP             0.8030 | 0.80085

 

Good luck

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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