Daily FX Market Commentary

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 103.877 | EURUSD 1.3767 | EURJPY 143.012 | AUDUSD 0.9248 | NZDUSD 0.85591 | USDCAD 1.10335 | EURCHF 1.2206 | USDCHF 0.88663 | GBPUSD 1.66257 | EURGBP 0.82805 |

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               104.075 | 103.81

EUR/USD             1.37715 | 1.37545

EUR/JPY               143.20 | 142.92

AUD/USD            0.9255 | 0.9211

NZD/USD             0.8580 | 0.8539

USD/CAD             1.1036 | 1.1016

EUR/CHF              1.2212 | 1.22045

USD/CHF             0.8875 | 0.88655

GBP/USD             1.6661 | 1.6621

EUR/GBP             0.8282 | 0.8261

 

For today

  • EUR: The market held its ground in early trading moving along the 1.3765 line before touching briefly above the 1.3770 levels in quiet trading. EURJPY offers above 143.20 kept a lid on the Euro while USDJPY crept higher. The Euro slowly pushed lower over several hours and while it was an improvement on the ranges 15 pips was about all she wrote as we move to the grey hours on the lows around 1.3755. With light stops appearing bow above the 1.3770 level and running to the 1.3800 the market is quickly followed with a deep level of offers from the figure area to 1.3840 with strong offers just above those levels. Downside has light bids from the lows down to 1.3720 and although the bids start to thin out through the 1.3700 level the market remains balanced that way in a mix to the mid 1.36’s
  • GBP: Nothing has changed in the Cable with the market unable to move out of either side for the moment the market saw some strong buying around the CNY fix with the market moving off the 1.6625 level and moving to above the 1.6650 and then at a slower pace to above 1.6660, once the demand disappeared the market quickly reversed the move over stating slightly to the 1.6625 level before holding around 1.6635. More an indication of how empty the market is in this 1.6620/60 area now. With no movement over the past 24hrs to break either way the market remains the same with offers running to the 1.6720 level with stops through the level before running into further offers around the 1.6760/80 area. Downside has light support from 1.6620 down to the 1.6600 area however, below is now a little thinner and mixed to 1.6550/30
  • JPY: The market opened quietly in the pre Tokyo session before moving higher into the session to above the 104.00 level and taking out much of the offers, stops still remain untouched above the level and one suspects that the market may have an option barrier just above the sentimental level and one wonders which will react first once the barrier is breached those that have bought or those that have defended. Once that is out of the way offers again start to appear from 104.30/50 and light offers then all the way to 104.80 before thickening. Downside has light buying down from 103.70 until around the 103.40 area however weak stop await below there and with nothing major showing until below 102.80 it could turn nasty.
  • AUD: The market now seems to have set its stall and has continued to weaken with weaker retail sales balancing a better trade balance number. Moving from a healthy 0.9250 level the market slumped on the release and dropped quickly to the lows in the 0.9215 area before bouncing almost back however, it was short lived and the sellers repeatedly pushed it back to just below 15 with decreasing attempts higher. With the market just off its lows the weak stops above 0.9270/0.9300 area seem an awful way away. For the moment the downside seems a bit light of anything meaningful however one suspects some light bids from the lows to 92cent before stops then light mixture from then on.

 

Overnight News

CNY:

China’s March official services PMI dips to 54.5

China services activity ticks up in March – HSBC PMI

China Doesn’t Have Enough Global Investors, CFFEX’s Li Says

JPY:

BOJ estimate to show Japan Q1 output gap closed to zero -sources

AUD:

RBA’s Stevens Says Too Early to Count Chickens on Transition

Australia CB chief says jobless rate still low historically

Australia retail sales, trade data point to solid Q1 growth

 

Today’s data

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

AUD       Retail Sales M/M Feb A 0.20% | C 0.40% | P 1.20%

AUD       Trade Balance (AUD) Feb A 1.20B | C 0.82B | P 1.43B

CNY        Non-manufacturing PMI Mar A 54.5 | P 55

07:45     EUR        Italian Services PMI Mar  C 51.9 | P 52.9

08:00     EUR        Eurozone Services PMI Mar (F) C 52.4 | P 52.4

08:30     GBP       Services PMI Mar C 58.1 | P 58.2

09:00     EUR        Eurozone Retail Sales M/M Feb C -0.60% | P 1.60%

11:30     USD       Challenger Job Cuts Y/Y Mar P -24.40%

11:45     EUR        ECB Rate Decision C 0.25% | P 0.25%

12:30     USD       Initial Jobless Claims (MAR 28) C 319K | P 311K

12:30     USD       Trade Balance Feb C -$38.5B | P -$39.1B

12:30     CAD       Trade Balance (CAD) Feb C 0.2B | P -0.18B

14:00     USD       ISM Non-Manufacturing Composite Mar C 53.5 | P 51.6

 

Harry Hindsight

  • EUR: The Euro struggled higher during Asia pushing against minor offers through an already broken 1.3800 level however; it struggled to comfortably penetrate 1.3810 until the end of the session and into the grey hours, early European bought for the break only for the London session to open with sellers triggering weak stops and a move back through 1.3800 and into the PPI numbers for the Eurozone. The market dipped slightly and generally ignored the number until the US moved in and the release of the ADP numbers showing an improvement over the previous month’s numbers. The market started to steadily drift lower and the factory order number moved the market the final part to the 1.3755 levels where the market held into a close in a quiet session towards the end.
  • GBP: When you look at the charts the market looks fairly choppy over the session however, the range was contained in a 40 pip area and struggled to make any meaningful moves either way. The market opened around the 1.6630 and stayed in and around the area until we moved into the London session, with the previous days real money buying in the EURGBP the market opened with instant selling as real money failed to turn up having pushed up towards the 0.8310 levels it dropped steadily from the opening in the first couple hours to 0.8280 and continued dipping slowly to below 0.8275 levels. The Cable benefited from the move in a reverse of yesterday’s action rising to above the 1.6660 before falling back. The market into NYK saw a stronger USD across the board and this undid the moves higher and the market moved back to the 1.6625 levels and settled in around that level for a quiet close, which was really little different to the whole day.
  • JPY: With a week full of data so far the market has disappointed in its ability to move in any direction, a suggestion that everyone is nervous in following the indications from said data. USDJPY moved higher from the 103.70 levels in early trading to above the 103.90 levels. The market struggled to push through the 104.00 level and never approached the level again during the session. The market held the 103.80 levels into London and it was slowly pushed down to the 103.60 areas before rising into the NYK session to that 103.80 area again and a quiet session overall.
  • AUD: As with most of the market it was a little quiet over all with the market struggling with USDJPY buying forcing the Oz back a little. However, having hit the 0.9225 lows the market rallied over the course of the session higher deep into the London session and making its way above the 0.9260 level before the US number strengthened the USD and again the market slowly drifted back before holding the 0.9250 levels into the close.

 

Yesterday’s premiership results

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

JPY         Monetary Base Y/Y Mar A 54.80% | C 60.20% | P 55.70%

AUD       Building Approvals M/M Feb A -5.00% | C -1.70% | P 6.80% | R 6.90%

GBP       Nationwide House Prices M/M Mar A 0.40% | C 0.80% | P 0.60% | R 0.70%

GBP       Construction PMI Mar A 62.5 | C 63.2 | P 62.6

EUR        Eurozone PPI M/M Feb A -0.20% | C -0.10% | P -0.30%

EUR        Eurozone PPI Y/Y Feb A -1.70% | C -1.70% | P -1.40%

USD       ADP Employment Change Mar A 191K | C 190K | P 139K | R 178K

USD       Factory Orders Feb A 1.60% | C 0.80% | P -0.70% | P -1.00%

USD       Crude Oil Inventories A -2.4M | C 1.3M | P 6.6M

 

Good Luck,

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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