Daily FX Market Commentary

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 99.538 | EURUSD 1.32997 | EURJPY 132.386 | AUDUSD 0.92718 | NZDUSD 0.81443 | USDCAD 1.03242 | EURCHF 1.23758 | USDCHF 0.93053 | GBPUSD 1.5805 | EURGBP 0.84148 |

 

Harry Hindsight

  • EUR: The market opened around the 1.3310 level and although we tested higher during the early part of the session the market reacted to the AUD numbers which turned the market lower and set off a chain of USD buying. The market moved off the 1.3325 areas and started a long decline into the London session pushing through 1.3300 to the 1.3280 levels. With very little in the way of news out of Europe the market remained mired and once NYK opened the market moved to its lows of 1.3258 areas. The market held around the 1.3275 area in the early part of the session before making a move higher helped by a steady GBP. With a lack of interest the market moved back to its highs however, to be honest the range was tight and volumes below what you’d expect for a Thursday. The market ended the day off from the highs and settling around the 1.3300 level.
  • GBP: Having opened around the 1.5820 level the market limped through Asia holding a very tight range peaking above 1.5830 and touching the 1.5830 level before moving into the grey hours. The market drifted lower with the drag of early Euro selling however with the EURGBP already off substantially over the past few days it would appear that the market is happy to buy on dips and with Cable remaining fairly strong they both helped each other over the course of the session. The market attempted to move lower on two different occasions with similar results with the low dip to the 1.5778 area causing a higher rise to touch above the 1.5840. The market in NYK ran out of ideas and drifted into a low close just above the 1.5800 levels.
  • JPY: USDJPY continued the selling from the previous 24hrs and the opening around the 99.90 saw a weak attempt at the 100 level before drifting off from that point. The strength in Yen was further increased with the numbers out of AUD as AUDJPY selling kicked in. by the time we reached the grey hours the market had already moved to below the 99.50 level. Early Europeans sold it further to the 99.20 level before we saw a bounce. The London session spent much of its time moving to the 99.60 level and holding the 99.30 before moving into NYK and moving lower once the US figures were put behind moving to just above the 99.00 level before a slow rise for the afternoon session in NYK to finish around the 99.50 level. Lots of noise today on the forth coming sales tax rise with one side saying it will happen while the other side saying it won’t.
  • AUD: The AUD was on hold from the opening 0.9320 area, rising slowly into the early Tokyo session as AUDJPY buying seemed to be the name of the game, as it turned out the market in the AUD peaked above the 0.9350 level and then the numbers hit with employment falling for the second month and we dropped quickly to the 0.9270 area with plenty of AUDJPY selling hitting the market as early buyers panicked. The quick drop slowed to a trickle from there drifting into the London session making a low below 0.9240 with some light bottom pickers raising the market slightly before we dipped to a new 0.9230 low, London remained very quiet holding around the 0.9250 area before the NYK market started to buy taking the market to 0.9270 level where we remained for the remainder of the session.

 

Yesterday’s premiership results

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

NZD       RBNZ Decision A 2.50% | C 2.50% | P 2.50%

JPY         Machine Orders M/M Jul A 0.00% | C 3.10% | P -2.70%

AUD       Employment Change Aug A -10.8K | C 10.2K | P -10.2K

AUD       Unemployment Rate Aug A 5.80% | C 5.80% | P 5.70%

EUR        Eurozone Industrial Production M/M Jul A -1.50% | C -0.10% | P 0.70%

CAD       New Housing Price Index M/M Jul A 0.20% | C 0.20% | P 0.20%

USD       Initial Jobless Claims (SEP 6) A 292K | C 332K | P 323K

USD       Import Price Index M/M Aug A 0.00% | C 0.50% | P 0.20%

USD       Monthly Budget Statement Aug A -147.9B | C -146.0B | P -190.5B

 

For today

USDJPY
Topside: 99.80-100.10 light offers  100.10-100.40 light mix 100.80-101.00 large offers
Downside: 99.00-99.30 light sell stops 98.70-99.00 light bids 98.40-98.70 medium bids 98.00-98.25 light sell stops

EURUSD
Topside: 1.3300-1.3330 light offers  1.3330-1.3360 medium offers 1.3400+ see’s stop building
Downside: 1.3260-1.3275 light mix 1.3230-1.3260 light mix 1.3200-1.3220 medium bids

EURJPY
Topside: 132.80-133.10 light offers  133.10-133.40 light offers
Downside: 131.70-132.00 light sell stops 131.20-131.50 light bids

AUDUSD
Topside: 0.9300-0.9330 light offers 0.9340-0.9360 light buy stops

Downside: 0.9190-0.9220 light sell stops 0.9150-0.9180 light bids

 

JPY:

Japan upgrades econ assessment for Sept on capex

Amari: Japan Cabinet, MOF See Differently on Corporate Tax Cuts

Fin Min Aso: Hard to Make People Accept Corp Tax Cut While Raising Sales Tax

Japan FinMin: will mull econ stimulus without resorting to Govt debt

Japan Govt spokesman: no order from PM to consider corporate tax cut

Japan revised July industrial output up 3.4% MoM

EUR:

EU’s Rehn Still Sees Confidence Risk in Banking Sector — Report

ECB’s Asmussen Tells Bild Rates Won’t Rise in Foreseeable Future

CNY/USD/JPY:

China military tells U.S. not to encourage Japan over isles

NZD:

Non-resident holdings of NZ debt edge higher in August – RBNZ

New Zealand manufacturing eases in August, still strong survey

NZ consumer confidence eases in September – ANZ survey

New Zealand food prices fall in August

USD:

Reports suggest that Syria special unit has begun moving objects to at least 50 different sites WSJ

 

 

  • EUR: The market saw some quiet USD buying against the board reflected with the selling seen in the Euro from the opening highs above 1.3302. Once we moved into the Tokyo session we saw some light stops triggered taking the market quickly to below the 1.3280 before holding and drifting into the mid 1.3280’s as we head to London.
  • GBP: Cable drifted lower from the opening having touched the 1.5813 level before slowly dropping down to just below the 1.5790 in some very quiet trading. The market holds around the lows for the moment with very little going on other than some light cross selling.
  • JPY: The market started to rise from the opening in Asia following through from the lows in NYK moving steadily to above the 99.80 level triggering the weak stops before running out of steam with volumes ok but not the greatest. Having hit the highs and run into some reasonable offers the market reverses and has fallen in the same type of tight channel as the rise. For the moment we are holding in the 99.70 areas.
  • AUD: The market drifted from the opening pushing from the 0.9275 level to initially the 0.9260 area where light bids held the market in front of suspected weak stops, the market continued to grind lower through the bids pushing to below the 0.9240 area before holding. We currently hold in the mid 0.9240’s as we head towards the London session in some very light volumes.

 

Today’s data

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

NZD       Business NZ Manufacturing Index Aug A 57.5 | P 59.5

JPY         Industrial Production M/M Jul (F) A 3.40% | C 3.20% | P 3.20%

07:15     CHF        Producer & Import Prices M/M Aug C 0.20% | P 0.00%

07:15     CHF        Producer & Import Prices Y/Y Aug P 0.50%

09:00     EUR        Eurozone Trade Balance (EUR) Jul C 15.3B | P 14.9B

12:30     USD       PPI M/M Aug C 0.10% | P 0.00%

12:30     USD       PPI Y/Y Aug C 1.30% | P 2.10%

12:30     USD       PPI Core M/M Aug C 0.10% | P 0.10%

12:30     USD       PPI Core Y/Y Aug C 1.30% | P 1.20%

12:30     USD       Advance Retail Sales Aug C 0.30% | P 0.20%

12:30     USD       Retail Sales Less Autos Aug C 0.30% | P 0.50%

13:55     USD       U. of Michigan Confidence Sep (P) C 81.7 | P 82.1

14:00     USD       Business Inventories Jul C 0.20% | P 0.00%

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               99.85 | 99.43

EUR/USD             1.3303 | 1.32745

EUR/JPY               132.59 | 132.285

AUD/USD            0.9271 | 0.9237

NZD/USD             0.8138 | 0.8105

USD/CAD             1.0331 | 1.0323

EUR/CHF              1.2385 | 1.2374

USD/CHF             0.93295 | 0.9300

GBP/USD             1.5805 | 1.5788

EUR/GBP             0.8412 | 0.84065
Good Luck

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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