Daily FX Market Commentary

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 101.872 | EURUSD 1.36046 | EURJPY 138.594 | AUDUSD 0.9373 | NZDUSD 0.87647 | USDCAD 1.06834 | EURCHF 1.21558 | USDCHF 0.89351 | GBPUSD 1.71282 | EURGBP 0.79428 |

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               101.92 | 101.68

EUR/USD             1.3610 | 1.3603

EUR/JPY               138.62 | 138.385

AUD/USD            0.9396 | 0.9363

NZD/USD             0.8773 | 0.8739

USD/CAD             1.0693 | 1.0677

EUR/CHF              1.21575 | 1.21525

USD/CHF             0.8936 | 0.8930

GBP/USD             1.7147 | 1.7126

EUR/GBP             0.7945 | 0.7935

 

For today

  • EUR: As volume goes it was not as weak as yesterday during the early part of the session however, the Euro played very little in the session drifting between the 1.3610/05 levels for the most part and spending the most part moving slowly lower. 1.3580/70 levels remains the support levels with a break below the level opening up a deeper move down with weak stops likely on the break, 1.3520 area provides the next support area which is likely to be stronger and protecting the 1.3470 lows of the year. Topside now has light offers forming above the 1.3610 levels but they are light and German trade balance could quickly swamp the level. A larger move would then run into trouble only once the market heads higher to the 1.3700 levels.
  • GBP: Cable moved from the 1.7130 levels to just short of the 1.7150 levels in early trading as yesterday’s GBPJPY sellers took meagre profits through the early part of the session, having made the highs the market dropped back to the opening levels and held around the 1.7135 levels for a couple of hours before giving way and slipping through the 1.7130 level in slow trading. Downside sees light bids from the 1.7110 levels with a push through the 1.7100 levels will see light stops and a deeper reversal to the 1.7020 areas with little in the way. Topside still remains limited with reasonable offers from the 1.7180 levels to the 1.7200 level and only those shorts from 1.7180-00 levels likely to provide weak stops. A move through the level again sees very little to the topside and only sporadic mix of orders.
  • JPY: After early selling to test the 200DMA again the market moved off the lows of 101.70 levels to head back towards the opening 101.85-88 area before holding in the area into the grey hours. Topside offers around the 102.20-30 area however, stops are likely to be weaker through the level, mixed with further offers. A push higher will find better offers from the 102.70 levels and without some decent tier1 data is likely to be limited. Downside bids appear from the 101.70 level but are not particularly strong and the market remains open until the 101.50-40 congested areas.
  • AUD: The market drifted in early Sydney from the opening 0.9370 levels and making the lows before starting a steady climb higher pushing until the NAB business confidence number helped it to move above 0.9395 in a rush and then dipping back to hold around the 0.9385 as action slowed. Topside sees weak offers from the 0.9400 to around the 0.9425 area with very little in stops and further offers running towards the topside and 95 cents. Downside bids begin around the 0.9340 congested area and down to the 93 cent area that has supported the market since the break higher at the beginning of Jun.

Overnight News

JPY:

BOJ’s Nakaso Says Conquest of Deflation in Japan Now Is Sight

Japan Posts Fourth Straight Current-Account Surplus in May

Japanese Buy Record Amount of France Sovereign Debt, Sell Bunds

Japan Economy Watchers Outlook Index Falls to 53.3 in June

JPY/AUD:

Japan’s Abe declares “special relationship” with Australia on visit

CNY:

China 1H New Foreign Investment Rose 23.8% Y/y: People’s Daily

Tianjin City Starts ‘Innovative’ Yuan Business in Zone: Xinhua

GBP:

BOE ‘Hasty’ Rate Increase Risks Hurting U.K. Recovery, BCC Says

NZD:

N.Z. Budget Deficit Wider Than Forecast on Tax Take

New Zealand Business Confidence Falls Off Sharply

AUD:

Australia business conditions at 5-month high-survey

Australia ANZ Consumer Sentiment June 29 Falls 0.3%

 

Today’s data

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

JPY         Current Account (JPY) May A 0.38T | C 0.17T | P 0.13T

AUD       NAB Business Confidence Jun A 8 | P 7

06:00     EUR        German Trade Balance (EUR) May C 16.2B | P 17.4B

07:15     CHF        CPI M/M Jun C 0.10% | P 0.30%

07:15     CHF        CPI Y/Y Jun C 0.20% | P 0.20%

07:15     CHF        Retail Sales (Real) Y/Y May C 1.50% | P 0.40%

08:30     GBP       Industrial Production M/M May C 0.30% | P 0.40%

08:30     GBP       Industrial Production Y/Y May C 3.20% | P 3.00%

08:30     GBP       Manufacturing Production M/M May C 0.40% | P 0.40%

08:30     GBP       Manufacturing Production Y/Y May C 5.60% | P 4.40%

14:00     GBP       NIESR GDP Estimate Jun P 0.90%

 

Harry Hindsight

  • EUR: The Euro slowly drifted through the Asian session pushing to the 1.3580 level from the opening 1.3595 levels, early Europeans pushed it a little lower through the 1.3580 level but were unable to take it too far and the market was squeezed higher on the failure and into decent investor numbers helping the market back to the 1.3600 level before then holding in the area through into the NYK session freshly back from a long weekend. With no data from the US the market moved another leg higher to rest just above the 1.3605 levels and into the end of the session with light volume throughout.
  • GBP: With no data for the day Cable struggled from the opening 1.7165 levels drifting lower in early Asia as EURGBP cross buying off the supported areas dragged on the GBP taking it to the 1.7140 areas, the move into London saw a fresh attempt in the EURGBP to push through the support and Cable managed a rally to the 1.7155 levels however, the London opening saw EURGBP buying move steadily into the market and a slow steady push from the 0.7916 levels to 0.7946 before holding the 0.7940 areas for the remainder of the session. Cable drifted back off as the cross rallied this time breaking through the 1.7140 and dipping into the NYK session to 1.7110 and light support. From there the market traded quieter than earlier slowly moving to the 1.7130 levels for the close.
  • JPY: Early strength in the USDJPY failed again to break above the 102.30 levels just sneaking above 102.20 from the opening 102.05 levels, once the highs were made the market slowly drifted to the 102.10 levels and quietly into the London session, GBPJPY selling combined with a slightly stronger Euro slowly pushed the USDJPY back to the 101.95 area and the market followed through into NYK slowly drifting to 101.85 in lacklustre trading.
  • AUD: The AUD moved in line with the USDJPY movement broadly with little interest in the market, dropping from the opening 0.9365 areas to just above the 0.9340 area as the USDJPY attempted the topside, the market eventually improved as the USDJPY weakened and AUDJPY remained in a 95.50/60 range into London. The Oz rose steadily from the lows throughout the day moving to the 0.9375 levels and stalling as the London market closed and settling only just off the highs.

Yesterday’s premiership results

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

JPY         Leading Index May (P) A 105.7 | C 105.9 | P 106.5

CHF        Unemployment Rate Jun A 3.20% | C 3.20% | P 3.20%

EUR        German Industrial Production M/M May A -1.80% | C 0.00% | P 0.20%

CHF        Foreign Currency Reserves Jun A 449.6B | C 445.0B | P 444.4B

EUR        Eurozone Sentix Investor Confidence Jul A 10.1 | C 7.8 | P 8.5

CAD       Building Permits M/M May A 13.80% | C 3.00% | P 1.10%

CAD       Ivey PMI Jun A 46.9 | C 52.5 | P 48.2

CAD       BoC Business Outlook Survey

 

Good Luck,

Andy

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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