Daily FX Market Commentary

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 102.246 | EURUSD 1.38401 | EURJPY 141.504 | AUDUSD 0.91327 | NZDUSD 0.85625 | USDCAD 1.11926 | EURCHF 1.21904 | USDCHF 0.88081 | GBPUSD 1.64965 | EURGBP 0.83893 |

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               102.35 | 102.14

EUR/USD             1.3840 | 1.38255

EUR/JPY               141.60 | 141.335

AUD/USD            0.9158 | 0.9121

NZD/USD             0.8564 | 0.8542

USD/CAD             1.1202 | 1.1188

EUR/CHF              1.2190 | 1.21825

USD/CHF             0.8812 | 0.88045

GBP/USD             1.6503 | 1.6487

EUR/GBP             0.8389 | 0.8385

 

For today

  • EUR: Euro’s slowly drifted from the opening areas around the 1.3840, with no real surprises it slipped quietly through the 1.3830 late into the session running to the mid 1.3820’s and while the pressure lower seemed solid enough the market was happy to take back short positions from early the previous day in retail trading. With a lot of wood chopped to the topside from yesterday’s NYK fix the market to the topside is a little more exposed than it was with offers running from around the 1.3850 level to 1.3870 they are only a patch on yesterday’s above there some weak stops and then better offers above the 1.3900 handle. Downside has light bids around the 1.3800 level running to 1.3770 before some stops start to make an appearance, even so sentimental levels start to see light bids appearing.
  • GBP: The market opened just below the 1.6500 and for the greater part of the session held around the levels with the range less than 10 pips, a slight movement in the USD pushed the Cable to its lows just below the 1.6490 levels matching movement in the Euro and JPY. The market remains in the congested zone and for the moment does not look to be moving either way. Support remains around the 1.6450 levels with light stops below before deeper bids start to make an appearance, topside has very little showing with leverage types likely to fade a move higher however, inflationary data today and the market could react in either direction with the risk from a higher number more likely to cause movement than a lower one with the background of no interest moves until next year pencilled in.
  • JPY: With the USDJPY doing a lot of work to the topside yesterday chewing through some of the offers the market has been rather muted today. A gradual move higher from the closing range in NYK moving to just below the 102.35 levels and holding steady in the area. Light offers above the 102.50 level replicate the larger ones from yesterday, those offers as with yesterday stretch back to 102.70 before the offers start to thicken and look stronger as the market makes its way to 103.00. Even through the 103.00 level light stops run straight into another set of offers with those through the 103.30 growing larger. Downside see’s decent support for the moment from 102.10 downwards with a mix through the 102.00 level and then light stops to the 101.70 area where bids again thicken and limit the movement of the market for the moment. A move through 101.50 sees stops again running into light bids from the 101.30 levels.
  • AUD: The market opened around the 0.9130 level and once the Tokyo market opened we saw a quick run higher to push through to the next technical level above 0.9175, with the Oz ignoring anything other than the CNY news the move through the 200DMA looks to have opened a higher move but that’s without any verbal intervention which is likely to be seen if the move continues. Having taken out the 0.9150 level the market saw profit taking and some leverage type shorts entering the market. Since the move higher the market has drifted lower back to the starting levels and a little lower. Offers run for the moment above the 0.9150 to around the 0.9180 level with a light mix of stops. Better stops appear above on a technical breakout opening the 0.9250 levels. Downside has light mix all the way down to the 0.9050 levels before some better support starts to appear in the market through there is patchy and 0.8980 bids then appear.

Overnight News

IMF:
China faces serious obstacles: IMF Chief Christine Lagarde

JPY/UAH:

Japan offers $1.5B aid to Ukraine

JPY:

Small business confidence grew in Mar to 53.5 from a previous 50.6

CNY:

Hundreds rush to rural Chinese bank after solvency rumours: Media
Today’s data

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

CNY        Conference Board Leading Index Feb A 0.90% | P 1.20%

09:00     EUR        German IFO – Business Climate Mar C 110.9 | P 111.3

09:00     EUR        German IFO – Current Assessment Mar C 114.6 | P 114.4

09:00     EUR        German IFO – Expectations Mar C 107.7 | P 108.3

09:30     GBP       CPI M/M Feb C 0.50% | P -0.60%

09:30     GBP       CPI Y/Y Feb C 1.70% | P 1.90%

09:30     GBP       Core CPI Y/Y Feb C 1.60% | P 1.60%

09:30     GBP       RPI M/M Feb C 0.50% | P -0.30%

09:30     GBP       RPI Y/Y Feb C 2.60% | P 2.80%

09:30     GBP       PPI Input M/M Feb C 0.30% | P -0.90%

09:30     GBP       PPI Input Y/Y Feb C -5.30% | P -3.10%

09:30     GBP       PPI Output M/M Feb C 0.20% | P 0.30%

09:30     GBP       PPI Output Y/Y Feb C 0.70% | P 0.90%

09:30     GBP       PPI Output Core M/M Feb C 0.00% | P 0.50%

09:30     GBP       PPI Output Core Y/Y Feb C 1.00% | P 1.20%

09:30     GBP       DCLG UK House Prices Y/Y Jan C 6.60% | P 5.50%

09:30     GBP       BBA Mortgage Approvals Feb C 50K | P 49.97K

11:00     GBP       CBI Reported Sales Mar C 28 | P 37

13:00     USD       House Price Index M/M Jan C 0.70% | P 0.80%

13:00     USD       S&P/Case-Shiller Composite-20 Y/Y Jan C 13.34% | P 13.42%

14:00     USD       Consumer Confidence Mar C 78.6 | P 78.1

14:00     USD       New Home Sales Feb C 445K | P 468K

 

Harry Hindsight

  • EUR: After a quiet start in Asia, opening around the 1.3805 areas the market drifted for most of the Asian session dipping below the 1.3790 level and rising towards the London session to the opening levels. Grey hours saw light selling from leverage accounts before the French data came in better than expected and Euro jumped to above the 1.3825 level only to collapse as the German PMI, the market moved initially to the 1.3790 before triggering some weak stops and dipping to 1.3770, before slowly declining to the 1.3760 levels and holding for several hours into the NYK session. The market decided late on to squeeze higher just after the NYK fix and a mini short squeeze taking the market quickly to above the 1.3875 levels before settling back into the closing range around the 1.3840 levels. A break in the EURAUD cross above the 100DMA helped push the Euro to its highs however, the move seems to have been triggered by a one off demand interest from a French group.
  • GBP: Cable remained in a tight range for the most part, from a low opening around the 1.6475 areas the market dipped below 1.6470 on two occasions however, during the Tokyo session that low was quickly left behind as the market moved into the Tokyo opening testing the 1.6500 level before holding for the rest of the session around the 1.6485 levels. While the range may have been a little better in London it was only barely, with the market still trading around the 1.6485 level the early market took the pair to above the 1.6510 on the opening and then reversed it as the GBP was dragged lower by poor numbers in Europe, and again testing the 1.6470 level. The market moved through into NYK in a similar choppy but tight range before the movement in the Euro initially dragged the GBP with it touching above 1.6535 before the EURGBP buying kicked in putting the Cable back to the 1.6500 levels and EURGBP again just below the 0.8400 level where decent offers seem to be resisting any movement to the topside.
  • JPY: USDJPY seemed to be making up for lost time in what was generally a quiet Asian session, moving from the opening 102.15 levels quietly into Tokyo and pushing from 102.30 to above the 102.55 level over the first couple of hours as retail players reopened positions after a long weekend. Once the initial rush was over the market drifted into the grey hours, trending slightly lower before early buyers in Europe repeated the process and chased the USDJPY to the 102.65 levels and through some medium sized offers. Having failed to penetrate the topside and into the 102.70 levels the market again settled back to the 102.45 areas and into the NYK session where the market saw successive sellers of the USDJPY as USD longs cut some of their positions having failed to gain much after Fridays Yellen comments and increasing repatriation trades drifting into the market, even so the market was only able to move to the opening levels and staying above the 102.10 level which seems to be providing reasonable support.
  • AUD: Oz gapped higher on the opening and immediately set about filling the gap to the downside dropping from the 0.9110 levels to 0.9080 into the Tokyo session, the release of the flash PMI in CNY left the market looking for bids in the pair and we again gapped this time to 0.9050 before finding willing buyers in the market. From this point on though it was all one way as the market moved steadily higher in a tight channel through the balance of Asia matching Friday’s closing areas and into London with little change in the direction. The market eventually stalled around the 0.9130 levels deep into London and in the early part of NYK, movement in the EUR helped the pair higher even though the EURAUD broke the topside 100DMA the movement in EUR was strong enough to take the Oz to touch the 0.9150 levels and make highs before drifting into a quiet range around 0.9130 into the close.

Yesterday’s premiership results

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

CNY        HSBC/Markit Flash Manufacturing PMI Mar A 48.1 | C 48.7 | P 48.5

EUR        French PMI Manufacturing Mar (P) A 51.9 | C 49.6 | P 49.7

EUR        French PMI Services Mar (P) A 51.4 | C 47.5 | P 47.2

EUR        German PMI Manufacturing Mar (A) A 53.8 | C 54.5 | P 54.8

EUR        German PMI Services Mar (A) A 54 | C 55.5 | P 55.9

EUR        Eurozone PMI Manufacturing Mar (A) A 53 | C 53.1 | P 53.2

EUR        Eurozone PMI Services Mar (A) A 52.4 | C 53 | P 52.6

 

Good Luck,

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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