Daily FX Market Commentary

Andy Harrison

Good morning,

NYK Close

USDJPY 79.947 | EURUSD 1.30585 | EURJPY 104.414 | AUDUSD 1.0322 | NZDUSD 0.81675 | USDCAD 0.99229 | EURCHF 1.21055 | USDCHF 0.92708 | GBPUSD 1.60121 | EURGBP 0.81546 |

 

 

Harry Hindsight

·         EUR: Asia began quietly with very little interest over the weekend, as Tokyo moved into the market this changed as large retail buying of EURJPY, AUDJPY kicked in and we saw HF type’s into straight Euro in particular, moving the market off the 1.3015 area to move it towards the 1.3050, London opened by reversing the movement on the back of an increase in the debt to GDP ratio to 87.3% and we were below 1.3025 again, increased support for Rajoy’s party in Galicia was sufficient to endorse austerity measures in the eyes of the market and the market reversed again and moved above 1.3070 leaving NYK with mixed views of buying at those levels so while we made a fresh daily high above 1.3080 we couldn’t sustain the move and dipped to range around the 1.3060 area into the close.

·         GBP: Cable had mixed fortunes finishing the day close to where we began with a rally on the back of the Euro moving up throughout Asia to top in early London above the 1.6050 area only for a slow drift lower as USD out performed GBP, GBP initially outperformed the Euro but London reversed that trend taking it from the 0.8125 lows to put it above 0.8165 as Euro became the darling for a change not. Cable eventually finished the day some 5 tics above where it started the day.

·         JPY: USDJPY rallied strongly in Asia having begun the day around the 79.25 level we moved quietly until just after Tokyo lunch with EURJPY and AUDJPY being picked up by the retail market in Japan so by the time London had come in we were already above the 79.60 level through the barrier at 79.50 and technical trades started to kick in, with the strength in USDJPY EURJPY broke through the 104 level eventually in early London triggering another round of stops to take that cross above 104.30 and both pairs remained moving steadily higher throughout the day. One supposes that the trade balance was really behind the rise and you have to wonder why the Euro attracted so much attention before the figure was released. Rearrange this common sentence envelope brown.

·         AUD: Unlike the rest of the market this one was non plus by the movements in other currencies, it opened around the 1.0320 area and moved lower initially cross buying against the Yen saw the market rise steadily to above the 1.0330 level but that was pretty much the extent of it reaching just below 40 in NYK before dropping all the way back to test below 1.0300 in the late session, it would seem events in the JPY took over and the Oz closes out barely above the opening levels, on a pretty dull day for it.

Yesterday’s premiership results

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

JPY      Trade Balance (JPY) Sep A -0.98T | C -0.74T | P -0.47T | R -0.46T

 

For today

USDJPY 
Topside: 80.00-80.30 decent buy stops  80.30-80.60 medium offers  80.70-81.00 light offers 
Downside: 79.50-79.80 medium bids 79.00-79.30 light bids 78.70-79.00 decent bids 

EURUSD 
Topside: 1.3080-1.3110 light buy stops  1.3120-1.3150 light offers  1.3170-1.3200 medium buy stops 
Downside: 1.3000-1.3030 light sell stops 1.2970-1.3000 medium sell stops 1.2920-1.2950 light bids 


EURJPY 
Topside: 104.70-105.00 light offers 105.20-105.50 medium buy stops 
Downside: 103.70-104.00 light sell stops 103.20-103.50 light bids 

AUDUSD 
Topside: 1.0340-1.0370 medium buy stops 1.0370-1.0400 medium offers 
Downside: 1.0270-1.0300 light bids 1.0220-1.0250 light bids

 

JPY:

Japan Jojima denies government seeks $250 bln BOJ asset buying boost

Econ Min Maehara: No Comment on Report Japan Govt Asked BOJ to Boost Asset Purchases

Japan Asks BoJ to Boost Asset-Purchase Program, Sankei Says

Japan EconMin Maehara: hope to attend Oct 30 BOJ meet

Japan Justice Minister Tanaka Decides to Step down -Kyodo

USD:

Obama, Romney clash over foreign policy in last debate

CNY:

China Insurance Regulator: Further Loosening Controls on Insurers’ Investments

AUD:

Australia economy softening, rates a support – RBA board member

Australian Govt Says 2012-13 Debt Program Largely Unchanged

AUD/CNY:

Chinese firm makes $850M bid for Australia’s Discovery Metals

 

 

·         EUR: The market opened with another rise in the Euro heading upwards straight away and hitting above 1.3075 similar to yesterday’s type of move with HF again suspected buyers however, the market seemed capped at the 1.3080 level and we failed to move much further and we ended up moving back down as there was a little bit of a scramble to get out of the longs with a number of people talking on the wires we moved down below the opening finally finding some support at the 1.3050 level where we look to be heading into the London session.

·         GBP: Similar sort of pattern to the Euro with GBPJPY being particularly noticeable in the movement, we opened just above the 1.6010 level and moved in the first couple of hours to hit around the 1.6024 mark before dropping back to the starting levels were we look to be heading into London.

·         JPY: USDJPY opened just below 80.00 as JPY continues to weaken as concern that Japan may not be the safe haven people thought it was, in the first couple of hours we attempted to break higher pushing through the 80.00 triggering some minor stop losses but not breaking fully we saw the market drop back though the opening area to hold just above the 79.80 area with bids close at hand down to the 79.50 level with most banks.

·         AUD: As with everything not Japanese, Oz made a small run higher in the first couple of hours but was unable to sustain the move and dropped back quickly having opened around the 1.0320 area we moved up towards the 1.0340 area only to fail and see a quick sell off down through the opening and back to around the 1.0315 where we stalled for a few hours as we head into the London market.

Today’s data

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

00:00     AUD       Conference Board Leading Index Sep A -0.80% | P 0.00%             

12:30     CAD       Retail Sales M/M Aug C 0.30% | P 0.70%               

12:30     CAD       Retail Sales Less Autos M/M Aug C 0.20% | P 0.40%        

13:00     CAD       BoC Rate Decision C 1.00% | P 1.00%      

14:00     EUR        Eurozone Consumer Confidence Oct (A) C -25.8 | P -25.9                             

Ranges as of 6am London time

                                Highs   Lows

USD/JPY               80.02 | 79.795

EUR/USD             1.3075 | 1.30505

EUR/JPY               104.59 | 104.15

AUD/USD            1.0339 | 1.0314

NZD/USD             0.8183 | 0.8163

USD/CAD             0.9929 | 0.9918

EUR/CHF              1.2110 | 1.2105

USD/CHF             0.9279 | 0.9261

GBP/USD             1.6023 | 1.6009

EUR/GBP             0.81605 | 0.81505

 Stay lucky

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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