Daily FX Market Commentary

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 100.981 | EURUSD 1.28692 | EURJPY 129.958 | AUDUSD 0.9133 | NZDUSD 0.78156 | USDCAD 1.05583 | EURCHF 1.24006 | USDCHF 0.96362 | GBPUSD 1.49521 | EURGBP 0.86067 |

 

Harry Hindsight

  • EUR: Asia was quiet with a hangover of bank holiday, Greece and Portugal weakening the Euro over the past few days, We opened Down from Fridays close around the 1.2820 area and struggled to break out of a 1.2812-30 range throughout the session and only started to see some movement as we moved towards the opening in London, with the news that Greece was a done deal more or less the pressure to sell the Euro’s seems to have been removed to some extent and the Euro started to rise from the London open trading to the 1.2860 level. With indifferent numbers out of Germany all it could really do was slow the ascent, we dipped into the pre-NYK opening with some light profit taking coming in only to see the US buyers of the Euro following through on the Greece news and pushing towards the 1.2880 level into the late session before slipping back to settle around the 1.2870 level in a somewhat dull day with no real players showing strongly.
  • GBP: Cable began the day weekly slipping from a low opening to below 1.4860 level before recovering to the opening areas of 1.4880 from there the market was caught in a tight range with very little movement to mention and we had to wait until London opening, from the opening we started to see a little movement higher and GBP was strong both against the Euro and the USD as news hit that a Chinese insurance group had bought the Lloyds building for £260mio ($388mio) giving GBP a boost. EURGBP dropped back from the highs above 0.8625 to just below 0.8605 area as views change to whether the funds have been converted or are to be converted. Cable peaked above the 1.4965 level before slipping back a little to the 1.4950.
  • JPY: USDJPY consolidated over the day with early buyers taking the market from the opening 101.25 level to touch above the 101.50 level. From there we saw some selling after the fixing demand and it drifted slowly through the session in Tokyo to move to just under the 100.95 area. As we moved into London the market again picked up a little with some late profit taking from the Japanese retail market triggering some weak stops triggered through the 101.25 level only to run out of steam above 101.35 and starting a drop back over the course of London and NYK to touch below 100.85 and settle around the 100.95 level.
  • AUD: The Oz held its own during the Asian session moving from the opening area of 0.9050 levels dipping to just below 0.9045 and touching above 0.9065 to set the range for the Asian market. The move into London saw the market starting to rise steadily and pushing over the session to above the 0.9140, while we moved steadily higher the futures market was at record shorts according to the CFTC release. We finished the day just off the highs around the 0.9130.

Yesterday’s premiership results

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

JPY         Current Account (JPY) May A 0.62T | C 0.62T | P 0.85T

JPY         Eco Watchers Survey: Current Jun A 53 | C 55.5 | P 55.7

CHF        Unemployment Rate Jun A 3.20% | C 3.20% | P 3.20%

EUR        German Trade Balance (EUR) May A 14.1B | C 17.4B | P 17.7B | R 17.5B

EUR        Eurozone Sentix Investor Confidence Jul A -12.6 | C -11.7 | P -11.6

EUR        German Industrial Production M/M May A -1.00% | C -0.50% | P 1.80% | R 2.00%

CAD       Building Permits M/M May A 4.50% | C 2.60% | P 10.50% | R 11.20%

 

For today

USDJPY
Topside: 101.20-101.50 light mix  101.50-101.80 light offers
Downside: 100.50-100.80 medium sell stops 100.20-100.50 light bids 99.90-100.20 light bids 99.30 stops building

EURUSD
Topside: 1.2870-1.2900 light offers  1.2900-1.2930 medium buy stops 1.2980-1.3000 medium offers
Downside: 1.2800-1.2830 light bids 1.2780-1.2800 decent sell stops 1.2760-1.2780 medium mix

EURJPY
Topside: 130.20-130.30 medium offers 130.30-130.60 light buy stops
Downside: Nothing of note

AUDUSD
Topside: 0.9150-0.9180 medium offers  0.9180-0.9210 medium buy stops
Downside: 0.9050-0.9080 medium bids 0.9000-0.9030 light bids

 

JPY:

Japan’s Amari: Govt Wants Wages to Rise Faster Than Inflation

Japan warns of toughening security climate in east Asia

Japan PM Abe To Visit 3 S.E. Asia Nations From July 25 – Kyodo

CNY:

China June CPI +2.7% on Year; Market Expected +2.5%

China Bans Change to Bond Trades Once Agreements Reached: PBOC

AUD:

Australian business conditions weaken in June survey

GBP:

UK house prices gallop higher in June – RICS

NZD:

NZ business sentiment rises in Q2 – NZIER survey

New Zealand house prices climb to record in June QV

N.Z. 2012-13 Budget Deficit May Be Narrower Than Forecast

NZ electronic card retail spending rises in June

 

 

  • EUR: Another slow day with summer ranges having settled into the market and not likely to change unless we have news or data that stands out in the market, we opened around the 1.2870 level and held in pre Tokyo market however, once Tokyo opened the USD buyers started to creep out and we saw the market start to drift lower into the mixed Chinese data falling to the 1.2847 area over an hour before finding some minor support and clawing its way back to the 1.2860 area with movement slightly exaggerated by liquidity issues.
  • GBP: Cable traded in the same manner as the Euro and stayed in line with the movements dropping from the Tokyo opening to touch 1.4920 from the 1.4950 area before recovering to the 1.4945 area with very little showing in the market.
  • JPY: USDJPY opened around the 101.00 area and struggled in the pre Tokyo market as USD sellers traded into the market with leveraged names seen early in the market. Once we moved into the Tokyo session everything changed, with rumours of good demand for the fixing we saw the market move off the lows just below 100.80 and quickly rise to above the 101.05 area before pausing, a decent M2 number and mixed numbers out of China the USDJPY managed to peak just below 101.25 level before dropping back a little to 101.10 where we currently hold as we head towards London.
  • AUD: The Oz opened around the 0.9130 and Sydney set the high just after the end of NYK near 0.9145 however, early sellers put the market down 20 points in a quick pre Tokyo move, as we moved into the Tokyo we had recovered however, the AUDJPY market started to attract more profit taking forcing it down from the 92.00 area and the AUD suffered as the JPY weakened against the USD. AUD dropped quickly to move to below 0.9085 in a just over a couple of hours with the saving grace being the China data and the market was back towards the opening area as we run towards London.

    Today’s data

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

NZD       NZIER Business Opinion Survey Q2 A 32 | P 23

GBP       BRC Sales Like-For-Like Y/Y Jun A 1.40% | P 1.80%

GBP       RICS House Price Balance Jun A 21% | C 9% | P 5%

JPY         Japan Money Stock M2+CD Y/Y Jun A 3.80% | C 3.40% | P 3.40%

AUD       NAB Business Confidence Jun A 0 | P -1

CNY        CPI Y/Y Jun A 2.70% | C 2.50% | P 2.10%

CNY        PPI Y/Y Jun A -2.70% | C -2.60% | P -2.90%

06:00     JPY         Machine Tool Orders Y/Y Jun (P) P -7.40%

07:15     CHF        Retail Sales (Real) Y/Y May C 3.70% | P 3.30%

08:30     GBP       Industrial Production M/M May C 0.20% | P 0.10%

08:30     GBP       Industrial Production Y/Y May C -1.40% | P -0.60%

08:30     GBP       Manufacturing Production M/M May C 0.40% | P -0.20%

08:30     GBP       Manufacturing Production Y/Y May C -1.50% | P -0.50%

08:30     GBP       Visible Trade Balance (GBP) May C -8.4B | P -8.2B

12:15     CAD       Housing Starts Jun C 190.0K | P 200.2K

14:00     GBP       NIESR GDP Estimate Jun P 0.60%

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               101.25 | 100.77

EUR/USD             1.2872 | 1.2845

EUR/JPY               130.11 | 129.745

AUD/USD            0.9140 | 0.9083

NZD/USD             0.7813 | 0.7763

USD/CAD             1.0574 | 1.0554

EUR/CHF              1.24135 | 1.2395

USD/CHF             0.9655 | 0.9633

GBP/USD             1.4954 | 1.4920

EUR/GBP             0.86125 | 0.8601

 

 

Good luck

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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