Daily FX Market Commentary

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 102.318 | EURUSD 1.38321 | EURJPY 141.51 | AUDUSD 0.92633 | NZDUSD 0.88169 | USDCAD 1.10219 | EURCHF 1.21956 | USDCHF 0.88169 | GBPUSD 1.68024 | EURGBP 0.82323 |

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               102.495 | 102.19

EUR/USD             1.3838 | 1.3827

EUR/JPY               141.76 | 141.40

AUD/USD            0.9281 | 0.9252

NZD/USD             0.8574 | 0.8553

USD/CAD             1.1030 | 1.1022

EUR/CHF              1.2200 | 1.2192

USD/CHF             0.88205 | 0.8814

GBP/USD             1.6813 | 1.6801

EUR/GBP             0.82325 | 0.8227

 

For today

  • EUR: The Euro held its levels throughout the session dipping only marginally into the high 1.3820’s before pushing back to the 1.3835 levels in quiet trading, the day see’s holidays in both NZ and Oz for ANZAC day, this impacted on the day and the week has really not been free flowing as you’d expect. With the market well supported still below the 1.3780 level with only minor stops and fresh bids around the 1.3730-20 levels the market seems to be dead in the water, topside has offers in depth going back from the 1.3850 levels to the 1.3900 before stops start to show above that level for a breakout, without some earth shattering news one would expect the market to go out with a whimper after a dull week.
  • GBP: Cable opened higher on liquidity issues during the crossover into the Asian session, opening just above the 1.6810 levels the market has traded sideways since that point and drifted around the 1.6805-10 levels for the whole session with very little in the market to gee it up. Offers around the 1.6840 levels hold the market in place for the moment with only light stops above stronger offers, above that the stronger the offers become to the 1.6900 level, Downside sees a light mixture from  1.6720 down to the 1.6680 level and then stronger bids dominate down to the mid 1.66’s and congestion from then on.
  • JPY: USDJPY tested the downside as some safe haven flows continued into the early part of the session however, without a full market it was likely to be weak in either direction, once Tokyo opened the market moved quickly off the 102.20 lows and pushed through the opening 102.30’s and headed sedately to 102.50 in the early round of buying into the fix, once the fixing demand was over with the market drifted again falling back to the opening levels and looks empty moving into the London session between 102.10-70. Downside support obviously rests at the 102.00 area and weak stops appear below the 101.80 levels with fresh light buying moving in from 101.50 and getting stronger towards the 101.20-30 levels. Topside offers are still at the 102.70 onwards levels with better stops now building on a break above 103.10; this is tempered somewhat by decent offers suspected into the 103.30 levels.
  • AUD: The only movement has been really generated by cross buying with AUDJPY buying early in the session only to see the AUD drop back once the USDJPY ran to its highs. We opened around the 0.9265 levels and apart from some selling into the Japanese fix the market has remained fairly well bid considering the market in Oz is closed, dipping to the 0.9255 level again before steadily rising to the 0.9280 levels and regaining some of yesterday’s loses. With ANZAC day, the likelihood of much of a movement is slim and limited data should see the market basing off the 0.9250-55 levels and unable to move back through weak offers around the 93cent levels.

 

Overnight News

JPY:

Tokyo core CPI rises to 22-yr high after Japan’s April tax hike

Japan’s Aso: CPI data shows deflation battle going well

Japan says no trade deal with US as Obama prepares to depart

Japan PM Abe says achieved ‘historic’ success with Obama

Japan’s LDP to Weigh Loosening Consumer Lending Law, Taira Says

USD/JPY:

U.S. Opposes Action to Undermine Japan Control of Islands

CNY:

China preliminary Q1 current account surplus at $7.2 bln

China urban jobless rate edges down to 4.08 percent at end-March

PBOC to Expand China-Taiwan Cross-Border Yuan Settlement: Daily

EUR:

EFSF Affirmed at ‘AA/A-1+’ by S&P; Outlook Stable

S&P: France ’Aa/A-1+’ Ratings Affirmed; Outlook Stable

Cyprus Credit Rating Raised by S&P; Outlook Positive

Juncker Doesn’t Rule Out New Greek Debt Cut: Stuttgarter Zeitung

USD/KRW:

Obama warns North Korea on nuclear test – S. Korean media

 

 

Today’s data

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

JPY         National CPI Core Y/Y Mar A 1.30% | C 1.40% | P 1.30%

JPY         Tokyo CPI Core Food Y/Y Apr A 2.70% | C 2.80% | P 1.00%

JPY         All Industry Activity Index M/M Feb A -1.10% | C -0.70% | P 1.00% | R 1.70%

08:30     GBP       Retail Sales M/M Mar C -0.40% | P 1.70%

08:30     GBP       BBA Loans for House Purchase Mar C 48.9K | P 47.6K

13:55     USD       U. of Michigan Confidence Apr (F) C 83 | P 82.6

 

Harry Hindsight

  • EUR: After a quiet Asian session the market edged higher to the 1.3825 levels on weak demand late into the session, the move into the grey hours saw renewed selling and the market was again pushed to the opening 1.3815 areas. A decent IFO set of numbers sent the market higher pushing to above the 1.3840 levels before Draghi comments again set the market back as verbal intervention increased. Mixed US data sent the market lower again with Durable goods coming in a lot better than expected with only a slight revision of the previous month, the downside was a higher initial claims tempering the move as the Euro broke below the 1.3800 level before rallying back to the 1.3825 levels as fresh buying entered the market. The evening session was nothing to write home about and the market died once the London session finished with it slowly pushing to above the 1.3830 levels for the close.
  • GBP: Cable was only slightly better than the Euro as it slowly started to rise over the course of the day, moving from the opening 1.6780 levels the Asian session managed to move it higher by a big 10 pips before we moved into the grey hours. The pre-London session was initially very quiet drifting slightly lower before being dragged higher with the Euro to top just above the 1.6805 levels the market tested the same levels on a couple further occasions during the session but was unable to push any higher. Strong USD buying after the US numbers sent Cable to the lows of the day below 1.6770 as with yesterday however, as with yesterday it halted smartly and again turned higher to resume its slow move higher holding around the 1.6800 level into the close of NYK.
  • JPY: USDJPY like the rest of the market remains fairly range bound moving from the 102.55 levels of the opening to drop back to 102.25 as the TPP talks continue between Japan and the US causing a little weakness in the market. The market based of the area into the grey hours and started a strong sustained rally into the early part of the day moving to the 102.65 areas to post the highs, while the market focused on the Durable goods numbers the USDJPY was more interested in initial claims and the USDJPY dropped from the highs quickly to post a 102.10 low before steadying, with increased nervousness in the Ukraine causing some substantial safe haven flows. The end to the session saw some light buying from the lows pushing the pair to the 102.35 areas into a quiet close.
  • AUD: The AUD opened around the 0.9290 levels and attempted over the course of the Asian session to move back through the 93 cent levels however, strong resistance and a lack of appetite in front of today’s ANZAC day left the market a little out of sorts and once the market moved towards the London session the rejection of the 93 cent level saw the market start to drop off quickly moving initially to the 0.9275 areas before the next leg of selling appeared and so on. The market eventually moved into the NYK session holding the 0.9255 levels with only minor foray’s to above 0.9270 before basing again, the close saw the market lift as early Pacific Rim players moved in and lifted the market to the 0.9265 levels into the close.

 

Yesterday’s premiership results

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

NZD       RBNZ Rate Decision A 3.00% | C 3.00% | P 2.75%

JPY         Corporate Service Price Y/Y Mar A 0.70% | C 0.70% | P 0.70%

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

CHF        Trade Balance (CHF) Mar A 2.05B | C 2.79B | P 2.62B | R 2.29B

EUR        German IFO – Business Climate Apr A 111.2 | C 110.4 | P 110.7

EUR        German IFO – Current Assessment Apr A 115.3 | C 115.6 | P 115.2

EUR        German IFO – Expectations Apr A 107.3 | C 105.8 | P 106.4

GBP       CBI Reported Sales Apr A 30 | C 17 | P 13

USD       Durable Goods Orders Mar A 2.60% | C 2.00% | P 2.20% | R 2.10%

USD       Durables Ex Transportation Mar  A 2.00% | C 0.60% | P 0.20% | R 0.10%

USD       Initial Jobless Claims (APR 19) A 329K | C 315K | P 304K | R 305K

 

Good Luck,

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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