Daily FX Market Commentary

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 98.351 | EURUSD 1.32409 | EURJPY 130.221 | AUDUSD 0.89303 | NZDUSD 0.77723 | USDCAD 1.05363 | EURCHF 1.23248 | USDCHF 0.93093| GBPUSD 1.55034 | EURGBP 0.85403 |

 

Harry Hindsight

  • EUR: With the Syrian situation seeming to be on a back burner as governments weight their options and/or get slapped down by the opposition parties the market turned again to renew the USD move steadily higher, having opened around the 1.3340 we moved quietly into Tokyo market and started to slide slowly to touch below 1.3325 areas before rallying back to the opening levels. As we moved into the grey hours the market started to move lower with selling coming in from early Europeans and we triggered weak stops through the 1.3300 levels falling to the 1.3270 levels as we moved into the London official open before holding in the 1.3260/70 area. The decline slowed at this point and limped along with volumes dropping off as we slowed. German numbers had little impact with a poor unemployment number and an under par inflation rate which could become a concern. As we moved into the NYK session the market continued its moves but a slower pace to touch below the 1.3220 level before finding some support. Reports of US hedge funds willing to invest in Spain’s semi-autonomous regional debt, so says the Spanish newspaper Expansion (good luck with that). The market managed a small rally into the close with profit taking helping the market to lift up slowly to above the 1.3240 level however, it was a weak move.
  • GBP: Unlike the Euro the market in Cable moved higher over the early part of the Asian session to trade above the 1.5545 level before succumbing to the drag of the Euro as we moved towards the grey hours moving back to the opening levels broadly speaking, with the Euro dropping over the course of the day it did weight on the Cable however, the EURGBP dropped for the second day as the Euro gave ground with the cross dropping from the 0.8590 area to touch below 0.8530. Cable moved into a reasonably choppy period trading between the lows of 1.5485 and 1.5520 area as we moved into the NYK session, we eventually moved back above the 1.5500 level holding into the close.
  • JPY: With the USD rallying for the most part USDJPY moved higher over the course of the day however, it was not all one way traffic like the previous day. Early trading saw the USDJPY rise from the opening 97.65 areas to just above 97.90 into early Tokyo before reaching offers that turned the market, the downside was no different with a rejection of the top we traded only as low as the supporting bids before starting to climb again from below the 97.45 levels. Having tested both sets of levels the market moved back to the opening levels. We moved into the grey hours with the market USD bid, we moved through the previous highs and resistance gave way as London triggered minor stops for a run to the 98.20 area before consolidating over the next few hours into the NYK session. NYK moved steadily higher touching above the 98.50 level however, with several layers of offers the market struggled to maintain the rally and ranged between the highs and 98.20 holding on to most of the gains to finish just below the 98.40 level.
  • AUD: The Oz saw early buyers of AUDJPY carry trades helped by the poor retail sales numbers in Japan, having seen the carry trade leading the way. This in turn interested profit taking in the AUDJPY and weak stops as the USDJPY dropped back to the opening areas as we moved into the London session, struggling to maintain those levels we dipped to the 0.8920 area before holding for most of the day around that area, with a dip into the close to set the low around the 0.8915 levels.

 

Yesterday’s premiership results

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

JPY         Retail Trade Y/Y Jul A -0.30% | C -0.10% | P 1.60%

NZD       NBNZ Business Confidence Aug A 48.1 | P 52.8

EUR        German Unemployment Change Aug A 7K | C -5K | P -7K

EUR        German Unemployment Rate Aug A 6.80% | C 6.80% | P 6.80%

EUR        German CPI M/M Aug (P) A 0.00% | C 0.10% | P 0.50%

EUR        German CPI Y/Y Aug (P) A 1.50% | C 1.70% | P 1.90%

USD       GDP (Annualized) Q2 A 2.50% | C 2.30% | P 1.70%

USD       GDP Price Index Q2 A 0.80% | C 0.70% | P 0.70%

USD       Initial Jobless Claims (AUG 23) A 331K | C 329K | P 336K | R 337K

CAD       Industrial Product Price M/M Jul A 0.30% | C 0.40% |P 0.30%

CAD       Raw Materials Price Index M/M Jul A 4.20% | C 1.20% | P 0.30%

 

For today

USDJPY
Topside: 98.50-98.75medium offers 98.70-99.00 light offers 99.00-99.30 light offers 99.40-99.80 light offers
Downside: 97.80-98.00 light sell stops 97.40-97.80 medium bids 97.00-97.30 light mix

EURUSD
Topside: 1.3250-1.3280 light mix 1.3280-1.3310 medium offers 1.3300-1.3320 light stops
Downside: 1.3180-1.3210 light mix 1.3150-1.3180 light bids 1.3120-1.3140 medium bids

AUDUSD
Topside: 0.8950-0.8980 light offers 0.8980-0.9010 medium buy stops
Downside: 0.8860-0.8900 light bids

 

JPY: Japan’s Amari: econ data laying groundwork for sales tax hike

Japan FinMin: economic data show favourable trend for sales tax hike

Aso: If Sales Tax Not Raised, Japan Fiscal Reform May Be Doubted

Japan core CPI up 0.7% YoY in July, fastest rise in nearly 5 yrs.

Japan July jobless rate falls to lowest since Oct 2008

Japan Aug manufacturing PMI rises to 52.2 from 50.7 in July

Japan July household spending up 0.1% vs. yr. ago

Japan Jul Indus Output +3.2% on Mo; Mkt Expected +3.8%

USD:

U.S. officials told lawmakers ‘no doubt’ on chemical weapons – congressman

Obama Prepared to Act Alone Against Syria, Aides Say: NYT

U.S. will consult with Britain despite Syria vote White House

CNY:

Former China Politburo member faces corruption probe – report

GBP:

U.K. Aug. GfK Consumer Confidence -13 vs. Est. -14

Parliamentary vote on Syrian action was lost with a 285-272 vote late last night

NZD:

New Zealand new housing consents slip in July

N.Z. Household Borrowing Rises 5.2% on Year, Fastest Since 2008

  • EUR: A quiet start for the day openi9ng around the 1.3240 area dipping into the low 1.3230’s before starting a move higher limited by the offers on the topside and stalling at the 1.3254 with importers seen buying EURJPY. Having run into the offers the market switched directions and we started to see the market drift lower over the rest of the session until we reached the opening levels and into the grey hours. Volumes have been limited to say the least with a very quiet session across the board.
  • GBP: Cable moved higher with the help of the Euro buying moving from the opening 1.5502 level to above the 1.5520 areas. The market was particularly quiet and while the vote for military action against Syria was voted down, the market had no reaction and to tell the truth it was a forgone conclusion given that the opposition was always going to vote against on principle of defeating the government with the help of a block of Liberal incumbents. Having touched the highs we spent the rest of the session drifting lower holding in the 1.5510 levels.
  • JPY: USDJPY initially moved higher from the opening with some limited demand for the USD’s in the Tokyo fix, once that passed the market started to trade in light of the numbers released earlier in the session, with a drop in the jobless rate and a lower IP number balancing otherwise bland numbers, having seen the USDJPY above the 98.45 level during the fix the market moved to trade below the 98.10 level but seemed contained and reasonably quiet as they head into the weekend, the market eventually moved back towards the opening levels where we move into the grey hours.
  • AUD: Having lost all of its early gains yesterday the market moved into Asia on the back foot with early players selling from the opening around 0.8925 in a push towards the 0.8900 level which held for the time being and traded off the 0.8915 level into Tokyo. From a poor early start the market slowly started to make headway trading slowly to above the 0.8950 level in very quiet trading. For the moment we’ve seen no major plays and all seems to be on the back of a strengthening Yen as we moved into the grey hours the market dropped back away from the highs and holds around the 0.8940.

 

Today’s data

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

NZD       Building Permits M/M Jul A -0.80% | C 1.30% | P -4.00%

GBP       GfK Consumer Sentiments Aug A -13 | C -14 | P -16

JPY         Nomura/JMMA Manufacturing PMI Aug A 52.2 | P 50.7

JPY         Household Spending Y/Y Jul A 0.10% | C 0.20% | P -0.40%

JPY         Jobless Rate Jul A 3.80% | C 3.90% | P 3.90%

JPY         National CPI Core Y/Y Jul A 0.70% | C 0.70% | P 0.40%

JPY         Tokyo CPI Core Y/Y Aug A 0.40% | C 0.40% | P 0.30%

JPY         Industrial Production M/M Jul (P) A 3.20% | C 3.70% | P -3.10%

JPY         Housing Starts Y/Y Jul A 12.00% | C 14.30% | P 15.30%

06:00     EUR        German Retail Sales M/M Jul C 0.60% | P -1.50%

07:00     CHF        KOF Leading Indicator Aug C 1.33 | P 1.23

08:30     GBP       Mortgage Approvals Jul C 59.0K | P 57.7K

08:30     GBP       M4 Money Supply M/M Jul P 0.10%

08:30     GBP       M4 Money Supply Y/Y Jul P 1.50%

09:00     EUR        Eurozone Economic Confidence Aug C 93.8 | P 92.5

09:00     EUR        Eurozone Industrial Confidence Aug C -9.6 | P -10.6

09:00     EUR        Eurozone Consumer Confidence Aug (F) C -16 | P -16

09:00     EUR        Eurozone Services Confidence Aug C -6.7 | P -7.8

09:00     EUR        Eurozone Unemployment Rate Jul C 12.10% | P 12.10%

09:00     EUR        Eurozone CPI Estimate Y/Y Aug C 1.40% | P 1.60%

09:00     EUR        Eurozone CPI – Core Y/Y Aug (A) C 1.10% | P 1.10%

12:30     CAD       GDP M/M Jun C -0.50% | P 0.20%

12:30     USD       Personal Income Jul C 0.20% | P 0.30%

12:30     USD       Personal Spending Jul C 0.30% | P 0.50%

12:30     USD       PCE Deflator M/M Jul C 0.20% | P 0.40%

12:30     USD       PCE Deflator Y/Y Jul C 1.50% | P 1.30%

12:30     USD       PCE Core M/M Jul C 0.20% | P 0.20%

12:30     USD       PCE Core Y/Y Jul C 1.30% | P 1.20%

13:45     USD       Chicago PMI Aug C 53 | P 52.3

13:55     USD       U. of Michigan Confidence Aug (F) C 80.5 | P 80

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               98.48 | 98.07

EUR/USD             1.3255 | 1.3233

EUR/JPY               130.34 | 129.96

AUD/USD            0.8952 | 0.8912

NZD/USD             0.7783 | 0.7754

USD/CAD             1.0542 | 1.0529

EUR/CHF              1.2329 | 1.2316

USD/CHF             0.9315 | 0.92955

GBP/USD             1.5524 | 1.5501

EUR/GBP             0.8540 | 0.85355
Good Luck

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

Any opinions, news, research, analyses, prices or other information ("information") contained on this Blog, constitutes marketing communication and it has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Further, the information contained within this Blog does not contain (and should not be construed as containing) investment advice or an investment recommendation, or an offer of, or solicitation for, a transaction in any financial instrument. LMAX Group has not verified the accuracy or basis-in-fact of any claim or statement made by any third parties as comments for every Blog entry.

LMAX Group will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. No representation or warranty is given as to the accuracy or completeness of the above information. While the produced information was obtained from sources deemed to be reliable, LMAX Group does not provide any guarantees about the reliability of such sources. Consequently any person acting on it does so entirely at his or her own risk. It is not a place to slander, use unacceptable language or to promote LMAX Group or any other FX and CFD provider and any such postings, excessive or unjust comments and attacks will not be allowed and will be removed from the site immediately.