Daily FX Market Commentary

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 99.123 | EURUSD 1.3359 | EURJPY 132.416 | AUDUSD 0.93559 | NZDUSD 0.82419 | USDCAD 1.02968 | EURCHF 1.23685 | USDCHF 0.92591 | GBPUSD 1.59036 | EURGBP 0.83995 |

 

Harry Hindsight

  • EUR: Early trading was fairly subdued with the market opening around the 1.3340 area before a slow move lower over the course of the Asian session peaking above the opening level before finally dropping towards the 1.3325 levels, the move into the grey hours saw early players buying the Euro in front of suspected reasonable numbers particularly out of Germany, taking the market to above the 1.3355 level before the numbers were released. On the release the market again moved higher to touch the 1.3370 areas before holding the 1.3360 area and a further attempt just in front of the NYK opening. NYK having failed the highs for the second time reversed the move and sent the market back to the opening levels. Indifferent set of inflationary numbers in the US sent the USD lower again and Euro’s pushed back to the 1.3360 level and spent the rest of the session in a 1.3350-60 range into the close.
  • GBP: As with the Euro the Cable was quiet throughout the Asian session moving from the 1.5900 level peaking above the 1.5905 area before dropping off a little to trade just above the 1.5890. As with the Euro the market started to pick up moving through the grey hours to above the 1.5915 level and the release of favourable inflationary numbers moved the market quickly to above the 1.5935 before rejecting the level and settling back quickly to the 1.5890 area again, we settled down to a narrowing range as the market moved along to close above the 1.5905 area on a quiet session.
  • JPY: USDJPY remained range bound for the day opening around the 99.05-10 area before moving to above the 99.35 during the Tokyo session, it fell off towards the move to the grey hours to just above the opening levels and this set the tone for the day with another attempt to the topside before holding around the 99.15 levels in quiet trading.
  • AUD: The AUD opened around the 0.9320 and moved quietly into the early part of Tokyo before starting to drop a little, the release of the RBA minutes first turned the market higher peaking above 0.9335 before dropping just as quickly to below the 0.9290 level as different people read the details the way they wanted. The statement was pretty non-committal with both statements to back off on interest cuts while leaving it on the table for possible use if the AUD were to start rising again. Having moved into the London session the market starts moving steadily over the session pushing to above 0.9360 before finding some resting offers, these continued to hold the market all the way to the close with what seemed to be a lack of interest for any breakouts. The market closed just short of the 0.9360 level.

Yesterday’s premiership results

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

CNY        Conference Board Leading Index A 0.70% | P 1.40%

EUR        Eurozone Current Account (EUR) Jul A 16.9B | C 18.3B | P 16.9B | R 19.8B

GBP       PPI Input M/M Aug A -0.20% | C 0.20% | P 1.10% | R 1.20%

GBP       PPI Input Y/Y Aug A 2.80% | C 3.00% | P 5.00% | R 5.10%

GBP       PPI Output M/M Aug A 0.10% | C 0.20% | P 0.20%

GBP       PPI Output Y/Y Aug A 1.60% | C 1.80% | P 2.10%

GBP       PPI Output Core M/M Aug A 0.00% | C 0.10% | P 0.10%

GBP       PPI Output Core Y/Y Aug A 1.00% | C 1.10% | P 1.10%

GBP       DCLG UK House Prices Y/Y Jul A 3.30% | C 3.30% | P 3.10%

GBP       CPI M/M Aug A 0.40% | C 0.50% | P 0.00%

GBP       CPI Y/Y Aug A 2.70% | C 2.70% | P 2.80%

GBP       Core CPI Y/Y Aug A 2.00% | C 2.10% | P 2.00%

GBP       RPI M/M Aug A 0.50% | C 0.40% | P 0.00%

GBP       RPI Y/Y Aug A 3.30% | C 3.20% | P 3.10%

EUR        German ZEW (Economic Sentiment) Sep A 49.6 | C 45 | P 42

EUR        German ZEW (Current Situation) Sep A 30.6 | C 20 | P 18.3

EUR        Eurozone ZEW (Economic Sentiment) Sep A 58.6 | C 47.2 | P 44

EUR        Eurozone Trade Balance (EUR) Jul A 11.1B | C 15.3B | P 14.9B

CAD       Manufacturing Shipments M/M Jul A 1.70% | C 0.50% | P -0.50%

USD       CPI M/M Aug A 0.10% | C 0.20% | P 0.20%

USD       CPI Y/Y Aug A 1.50% | C 1.60% | P 2.00%

USD       CPI Core M/M Aug A 0.10% | C 0.10% | P 0.20%

USD       CPI Core Y/Y Aug A 1.80% | C 1.80% | P 1.70%

USD       Net Long-term TIC Flows Jul A 31.1B | C -45.3B | P -$66.9B

USD       NAHB Housing Market Index Sep A 58 | C 59 | P 59

 

For today

USDJPY
Topside: 99.30-99.60 medium offers  99.60-99.90 light mix  100.00-100.30 medium offers
Downside: 99.00-99.10 light bids 98.80-99.00 light sell stops 98.50-98.80 light sell stops 98.20-98.40 light sell stops

EURUSD
Topside: 1.3370-1.3400 medium mix  1.3420-1.3450 light buy stops 1.3500-1.3520 medium buy stops
Downside: 1.3290-1.3320 light bids 1.3250-1.3280 light mix

EURJPY
Topside: 132.80-133.10 light buy stops  133.20-133.50 light offers
Downside: 132.00-132.30 light sell stops

AUDUSD
Topside: 0.9390-0.9420 medium offers  0.9430-0.9470 decent buy stops
Downside: 0.9300-0.9320 light bids 0.9250-0.9265 medium bids

 

JPY:

Abe May Attend Meeting to Discuss Raising Wages, Suga Says

Japan Considers Rules to Shoot Down Unmanned Aircraft: Sankei

CNY:

China August home prices rise 8.3% YoY

Asia:

Asia business sentiment drops sharply in Q3

AUD:

Talk of housing bubble in Australia “unrealistically alarmist” RBA

S&P cuts rating on Western Australia state to AA+, outlook now stable

EUR:

Cyprus Plans to End Capital Controls in January, President Says

NZD:

NZ annual current account deficit narrows in Q2

English Says Kiwi Dollar in High 70 US Cent Range ‘Comfortable’

N.Z.’s English: ‘More Comfortable’ About Current Account Deficit

SEK: Sweden Sees Growth of 1.2% in 2013, 2.5% in 2014, Borg Says

 

 

  • EUR: The early trading was from the 1.3358 area and we moved quietly into the Tokyo session with no change, the market moved lower from there but you’d not notice really as the market was really contained in a 13 pip range in what has been a very quiet session. What movement we saw was created by the minor move in AUD.
  • GBP: As with the Euro the Cable struggled through the session with a peak above 1.5910 in early trading which was only just above the opening level to move into the Tokyo session dropping off slowly to below 1.5894, we recovered to above the 1.5900 level in late trading and hold around the 1.5905 as we head to the grey hours. While Cable is not the most active pair in Asia the volumes were atrocious and one suspects that the world has taken a holiday and not told me.
  • JPY: USDJPY had a better range than most but to be honest 22 pips is all you get. The market opened around the 99.14 area and moved into the Tokyo session with very little movement, the Tokyo fix found some limited buying, enough to move the market to the highs after a follow through of demand, touching just below the 99.34. The market then started to slip from the highs dropping to the mid 99.20’s as we move to the grey hours.
  • AUD: The Oz initially opened around the 0.9355 area and ran only slightly higher before moving into the Tokyo session better index figures helped initially to prop the market up however, comment by retail magnate Solomon Lew for another 50bps cut to stimulate the retail market in Australia seemed to take the market over in an otherwise quiet session with the market dropping off to below the 0.9338 in a limited reaction. From that point the market has quietly moved back higher and we hold for the moment around the 0.9350 level.

 

Today’s data

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

NZD       Current Account Balance Q2 A -1.25B | C -1.9B | P -0.663B

AUD       Conference Board Leading Index Jul A 0.30% | P -0.20%

AUD       Westpac Leading Index M/M Jul  A 0.60% | P 0.00%

08:30     GBP       Bank of England Minutes C 0–0—9 | P 0–0–9

09:00     CHF        ZEW (Expectations) Sep P 7.2

12:30     USD       Housing Starts Aug C 923K | P 896K

12:30     USD       Building Permits Aug C 950K | P 943K

14:30     USD       Crude Oil Inventories P -0.2M

18:00     USD       FOMC Rate Decision C 0.25% | P 0.30%

18:30     USD       Fed’s Bernanke Press Conference

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               99.34 | 99.105

EUR/USD             1.3360 | 1.33455

EUR/JPY               132.595 | 132.37

AUD/USD            0.9358 | 0.9336

NZD/USD             0.8239 | 0.8214

USD/CAD             1.0303 | 1.0296

EUR/CHF              1.2374 | 1.2367

USD/CHF             0.92685 | 0.92585

GBP/USD             1.5906 | 1.5893

EUR/GBP             0.83995 | 0.8395
Good Luck

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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