Good morning,
LMAX Close
USDJPY 99.332 | EURUSD 1.31921 | EURJPY 131.041 | AUDUSD 0.8979 | NZDUSD 0.78083 | USDCAD 1.05483 | EURCHF 1.23268 | USDCHF 0.9345 | GBPUSD 1.55437 | EURGBP 0.84882 |
Harry Hindsight
- EUR: Euro’s opened around the 1.3210 level and struggled in early trading with cross selling pushing the market below the 1.3200 level to touch below 1.3195 to make the low in Asia, with the bank holiday in the US trading was weak throughout the day and Asia remained around the 1.3200 level for the Asian session. Grey hours saw early buying as bottom hunters picked up the ball and the market was quickly to above the 1.3225 level into the London opening; we attempted the topside several times before giving up the ghost after reasonable numbers out of Europe, some are calling the M&A action in the UK as being the catalyst for the drop in Europe but for me that doesn’t quiet ring true as the deal has been on the cards for several days and with no direct correlation other than through GBP well we can see where that goes. So if you’re looking for answers I’d be more inclined to call it just weak trading leaving the downside exposed after the attempts higher. By the time we moved into an absent NYK session the selloff was in full flow and we traded steadily over the next few hours to below the 1.3185 level where the market closed in London and then drifted in a narrow range finishing the day around the 1.3190 level.
- GBP: Cable opened around the 1.5520 and moved slowly into Tokyo before rising quickly with early FT stating upcoming PMI numbers were expected to be much improved, add to which the confirmation that Vodaphone had agreed the sell back of Verizon and we jumped to above the 1.5550 level and traded off the level over the next few hours touching the 1.5570 level in the grey hours. Into London and the market again moved higher after on the numbers to push above 1.5590 with the expected good numbers. The market held the 1.5580 for the next several hours into the early NYK session. With the US closed we saw the market slowly descending through the remainder of the session dropping back to the 1.5540 area with a range between the 1.5540-1.5550 finishing in the centre of the range for the close.
- JPY: The USDJPY made some headway during Asia moving from the opening 98.45 and steadily rising over the course of Tokyo to above the 98.65 level before stalling, all though there was reasonable data out of both China and results from the discussions over the expected sales tax increase. Into the grey hours we saw a surge in GBPJPY buying as well as straight USDJPY moving the pair to above the 99.30 level with some weak stops triggered along the way. The market once there stalled and we stayed in that area for the rest of the session with a minor dip to the 99.15 area but failing to move beyond the 99.40 area after its initial spike. The market eventually settled around the 99.35 level.
- AUD: With good numbers out of China the AUD spent most of the Asian session moving higher to above the 0.9010 level from the opening 0.8935, no real shock moves apart from stops triggered through the 90cent level. Having peaked above there the market started to drift to below the 0.8970 and then trading between there and the 0.8990 level which is around where we settled in a quiet day outside Asia.
Yesterday’s premiership results
Actual = A | Consensus = C | Previous = P | Revised = RÂ
CNYÂ Â Â Â Â Â Â Manufacturing PMI Aug A 51 | C 50.6 | P 50.3
NZDÂ Â Â Â Â Â Terms of Trade Index Q/Q Q2 A 4.90% | C 3.80% | P 4.10% | R 4.20%
JPYÂ Â Â Â Â Â Â Â Capital Spending Q2 A 0.00% | C -2.00% | P -3.90%
AUDÂ Â Â Â Â Â TD Securities Inflation M/M Aug A 0.10% | P 0.50%
AUDÂ Â Â Â Â Â Building Approvals M/M Jul A 10.80% | C 4.00% | P -6.90% | R -6.30%
CNYÂ Â Â Â Â Â Â HSBC/Market Manufacturing PMI Aug A 50.1 | C 50.2 | P 47.7
EURÂ Â Â Â Â Â Â Italian PMI Manufacturing Aug A 51.3 | C 50.7 | P 50.4
CHFÂ Â Â Â Â Â Â SVME-PMI Aug A 54.6 | C 55.2 | P 57.4
EURÂ Â Â Â Â Â Â Eurozone PMI Manufacturing Aug (F) A 51.4 | C 51.3 | P 51.3
GBPÂ Â Â Â Â Â PMI Manufacturing Aug A 57.2 | C 55 | P 54.6
For today
USDJPY:
Topside: 99.70-99.85 light offers 99.90-100.50 light offers 100.60-100.80 light stops
Downside: 99.00-99.20 light bids 98.55-98.85 light mix 97.80-98.00 light bids
EURUSD:
Topside: 1.3200-1.3220 light offers 1.3240-1.3260 light buy stops 1.3270-1.3300 light offers 1.3340-1.3360 light buy stops
Downside: 1.3150-1.3180 light mix 1.3100-1.3140 light bids
EURJPY:
Topside: 131.80-132.20 light buy stops 132.20-132.50 light offers
Downside: Noting of note
AUDUSD:
Topside: 0.9050-0.9080 light mix
Downside: 0.8960-0.8990 light sell stops 0.8930-0.8945 light bids 0.8900-0.8920 light sell stops
AUD:
RBA’s Stevens Keeps Benchmark Interest Rate at 2.5% (Full Text)
Australian Retail Sales Weaker Than Expected
Australia’s Current Account Deficit Widens
Foreigners Increased Aussie Debt Holdings to 69.1% in 2nd Qtr.
Australia Q2 government spending distorted by asset sale
Robb Says RBA hasn’t got a lot of room left If unforeseen Event
JPY:
Japan to tell G20 it will raise sales tax as planned-FinMin
Japan says to spend $473 million for Fukushima water problem
EconMin Amari: UN Members Need to Pay Serious Attention to Syria Situation
JPY/USD:
Japan Govt Suga: Obama, Abe Explained Respective Stances on Syria
EUR/USD:
Microsoft to Buy Nokia’s Devices Unit for 5.44 Billion Euros
CNY:
China’s Non-Manufacturing PMI Falls to 53.9 in August
China State Assets Chief Removed From Office -Xinhua
China’s President to Visit Central Asia Ahead of G20 Summit
GBP:
Rising UK Retail Sales Support Improving Economic Outlook -BRC
- EUR: A very quiet day for the Euro, with the market opening around the 1.3190 area and for the most part we haven’t moved away from the area, dipping to the mid 1.3180’s in early trading before holding a tight 1.3186-91 range for several hours.
- GBP: A similar range as with the Euro with the only difference being the Cable rose slightly higher moving from the 1.5544 area pushing to above the 1.5560 level over the course of the session before holding in the higher 1.5550’s
- JPY: USDJPY found bids from the opening with talk of equity highs relating to the rise however, that makes very little sense and is probably more to do with an expansion in the monetary base giving rise to a weaker JPY moving into the Tokyo session topping out above the 99.70 level in early trading. Once the market topped it started to drift in the second half of the session drifting lower back to the opening levels before holding around the 99.50 levels, RBA rate decision gave the market more grounds to move lower as AUDJPY profit taking moved into the market to take advantage of the moves in Oz.
- AUD: The Oz opened around the 0.8975 area and immediately moved higher pushing to the 0.9010 level before holding and dipping to the 0.8995 as early RBA announcement traders started jostling for position. As we moved into the Tokyo session we saw a similar reaction and the market this time topped above the 0.9025 level before dropping quickly back on poor retail sales numbers. From there the market was quiet and held around the opening levels until the RBA announcement, with no change the market reacted as normal with a spike higher to just beyond the previous highs before holding around the 0.9030 level as trading slowed as people took time to read into the details. With a GDP release tomorrow all eyes now focus on the next number, obviously the market see’s the number tomorrow as favourable to some extent as the no change after so many weak number prints in recent weeks suggest this however, this is never a given. One of the comments removed from the after dinner speech was the “scope to ease†leaving the market with the impression that the whole thing is less dovish than previously, of course one has to take this in light of an upcoming election
Today’s data
Actual = A | Consensus = C | Previous = P | Revised = R | All GMT
GBPÂ Â Â Â Â Â BRC Sales Monitor Y/Y Aug A 1.80% | P 2.20%
JPYÂ Â Â Â Â Â Â Â Monetary Base Y/Y Aug A 42.00% | C 41.30% | P 38.00%
AUDÂ Â Â Â Â Â Retail Sales M/M Jul A 0.10% | C 0.40% | P 0.00%
AUDÂ Â Â Â Â Â Current Account Balance (AUD) Q2 A -9.4B | C -8.5B | P -8.5B
JPYÂ Â Â Â Â Â Â Â Labour Cash Earnings Y/Y Jul A 0.40% | C 0.80% | P 0.60%
AUDÂ Â Â Â Â Â RBA Rate Decision A 2.50% | C 2.50% | P 2.50%
05:45Â Â Â Â CHFÂ Â Â Â Â Â Â GDP Q/Q Q2 C 0.30% | P 0.60%
08:30Â Â Â Â GBPÂ Â Â Â Â Â PMI Construction Aug C 58.4 | P 57
09:00Â Â Â Â EURÂ Â Â Â Â Â Â Eurozone PPI M/M Jul C 0.10% | P 0.00%
09:00Â Â Â Â EURÂ Â Â Â Â Â Â Eurozone PPI Y/Y Jul C 0.10% | P 0.30%
14:00Â Â Â Â USDÂ Â Â Â Â Â ISM Manufacturing Aug C 54 | P 55.4
14:00Â Â Â Â USDÂ Â Â Â Â Â ISM Prices Paid Aug C 51.6 | P 49
14:00Â Â Â Â USDÂ Â Â Â Â Â Construction Spending M/M Jul C 0.30% | P -0.60%
Â
Interbank Ranges as of 6am London time
Highs   Lows
USD/JPYÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 99.705 | 99.32
EUR/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.3197 | 1.31845
EUR/JPYÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 131.48 | 131.03
AUD/USDÂ Â Â Â Â Â Â Â Â Â Â 0.9042 | 0.8973
NZD/USDÂ Â Â Â Â Â Â Â Â Â Â Â 0.7839 | 0.7804
USD/CADÂ Â Â Â Â Â Â Â Â Â Â Â 1.0560 | 1.0542
EUR/CHFÂ Â Â Â Â Â Â Â Â Â Â Â Â 1.23305 | 1.2326
USD/CHFÂ Â Â Â Â Â Â Â Â Â Â Â 0.93505 | 0.9340
GBP/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.5562 | 1.5540
EUR/GBPÂ Â Â Â Â Â Â Â Â Â Â Â 0.84885 | 0.8478
Good Luck
Andy