Daily FX Market Commentary

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 104.804 | EURUSD 1.36705 | EURJPY 143.281 | AUDUSD 0.89118 | NZDUSD 0.81916 | USDCAD 1.06705 | EURCHF 1.22906 | USDCHF 0.89903 | GBPUSD 1.645511 | EURGBP 0.8310 |

 

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               104.875 | 104.08

EUR/USD             1.3673 | 1.3645

EUR/JPY               143.285 | 142.085

AUD/USD            0.8994 | 0.8886

NZD/USD             0.8258 | 0.818

USD/CAD             1.0672 | 1.0637

EUR/CHF              1.22945 | 1.2281

USD/CHF             0.90045 | 0.89895

GBP/USD             1.6458 | 1.6422

EUR/GBP             0.8315 | 0.83035

 

For today

  • EUR: A quiet day for the Euro’s price wise even if the volumes were much improved from the past couple of weeks. With the market opening around the 1.3665 levels we struggled above the 1.3670 area and once the USDJPY renewed its move lower EURJPY selling weighed on the Euro and we fell back to the 1.3650 areas where we move towards London. Topside is now littered with stops above the break down areas of 1.3700 and a mix thereafter to 1.3800. With scaled down bids dropping down over the next big figure one would guess failing any dramatic news we stay on this big figure into the weekend.
  • GBP: As with the Euro for the greater part of the session holding up a little better and sticking to the opening areas around 1.6450’s dipping to mid-1.6420 areas before moving back to the 1.6440/50 range and we move towards London around those areas with very little space to the downside as we look at Decembers congested area. Topside would remain a sticking point for the moment with only a clear break above the 1.6600 levels holding it from attempting the 2009 highs.
  • JPY: Having spent much of yesterday in decline, the Asian session was very little different with JPY crosses being the focus of many a Macro player as they either set their stall out for new plays or add to current positions. EURJPY, GBPJPY and particularly AUDJPY were seen coming through, and USDJPY having opened around the 104.80 levels moved quietly initially before dropping off down to 104.10 as we move towards the London session. With good interest moving into what was the range in Asia yesterday offers are fairly thick above the 105.50 levels with talk of large option barriers which for some reason were not seen before the festive period. The downside has cleared much of the bids and the 104.00 level is now left exposed with only patchy mix to the next levels around 103.50.
  • AUD: The market opened quietly around the 0.8910 areas and struggled in early trading however, with the onset of AUDJPY selling the market dipped to the 0.8890 area before starting a long steady rally as the JPY leg gave ground and we moved steadily to above the 0.8990 levels in strong buying. We currently hold around the 0.8970 areas holding most of the gains. Downside sees bids around yesterday’s los with light stops below there and for the moment we’ve blown away the offers and nothing much shows until light offers from medium term players above the 0.9020 areas.

 


Today’s data

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

08:00     CHF        KOF Leading Indicator Dec C 1.91 | P 1.85

08:30     CHF        SVME PMIs Dec C 56.2 | P 56.5

09:00     EUR        Eurozone M3 Y/Y Nov C 1.50% | P 1.40%

09:30     GBP       PMI Construction Dec C 62 | P 62.6

09:30     GBP       Mortgage Approvals Nov C 69.7K | P 67.7K

09:30     GBP       M4 Money Supply M/M Nov P 0.10%

16:00     USD       Crude Oil Inventories P -4.7M

 

Harry Hindsight

  • EUR: After a dull Asian session with the market opening around the 1.3750 the market slowly made our way to above the 1.3775 levels before starting to drift into the London session. While the data was in line with expectations today was about putting on positions taken off prior to the festive periods and we saw EURGBP buying and Cable selling to that end sending the Euro lower with it. The market dropped down to the 1.3720 levels on the data and then continued after the UK numbers to push as low as the 1.3630 levels, the whole move was exaggerated with still much of the market having an extended break, the NYK session was really as exciting as the Asian and the market struggled back to the 1.3650-70 area to range into the close, with a mixed bag of numbers.
  • GBP: Cable seemed to be well bid in a thin Asian session and as we approached the grey hours the market moved tentively above the 1.6600 before starting a steady drop off as the London sellers appeared, the market dropped steadily into the numbers holding around the 1.6540 levels before dropping away for another run lower to touch below 1.6420 into early NYK. Strong EURGBP buying from Macro types helped supress the Cable with the cross moving from below 0.8270 to touch the 0.8320 levels into late NYK. Cable stayed on the back foot for most of the remainder of the session and barely moved back above the 1.6445 area.
  • JPY: As with everything bought in the dying moments of last year, today’s openings saw the opposite effect as positions were either added or renewed. The market dropped back from the Asian session and with the help of cross selling in GBPJPY and EURJPY the market moved quickly to below 104.70 before renewing the move to hold the 104.50 levels and finish the day around the 104.80’s.
  • AUD: The market opened lower with plenty of stops being triggered and dropping down below the 89cent areas in the first few minutes from above 0.8915, the market then stabilized and slowly moved back higher to fill the gap, the move towards London again saw the market moving lower in a more orderly fashion to the 0.8880 levels before triggering a fresh batch of weak stops to the 0.8850 levels into the NYK session. NYK were sellers of USD’s across the board with the mixed data and with AUDJPY under pressure and JPY climbed AUD was free again to climb higher and set the highs above 0.8940 before running out of steam from mid NYK onwards for a quiet close around the 0.8910 levels.

Yesterday’s premiership results

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

EUR        Italian PMI Manufacturing Dec A 53.3 | C 51.7 | P 51.4

EUR        Eurozone PMI Manufacturing Dec (F) A 52.7 | C 52.7 | P 52.7

GBP       PMI Manufacturing Dec A 57.3 | C 58.2 | P 58.4

USD       Initial Jobless Claims (DEC 28) A 339K | C 334K | P 338K | R 341K

USD       ISM Manufacturing Dec A 57 | C 56.9 | P 57.3

USD       ISM Prices Paid Dec A 53.5 | C 52.8 | P 52.5

USD       Construction Spending M/M Nov A 1.00% | C 0.60% | P 0.80%
Good Luck

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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