Daily FX Market Commentary

Andy Harrison

Good morning,

 

LMAX Close Wellington open

USDJPY 101.348 101.35-40 | EURUSD 1.35256 1.3526-30 | EURJPY 137.079 137.10-15 | AUDUSD 0.93963 0.9386-91 | NZDUSD 0.86882 0.8685-90 | USDCAD 1.07342 1.0740-45 | EURCHF 1.21506 1.2148-53 | USDCHF 0.8984 0.8980-85 | GBPUSD 1.70846 1.7088-93 | EURGBP 0.79168 0.7912-17 |

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               101.38 | 101.215

EUR/USD             1.35495 | 1.3524

EUR/JPY               137.185 | 137.035

AUD/USD            0.9401 | 0.9385

NZD/USD             0.8721 | 0.8688

USD/CAD             1.0742 | 1.0731

EUR/CHF              1.2156 | 1.21465

USD/CHF             0.8982 | 0.8971

GBP/USD             1.7099 | 1.7080

EUR/GBP             0.7924 | 0.7914

 

For today

  • EUR: A steady rise from the opening moving from 101.28 to just above the 1.3535 level before breaking quickly to just short of the 1.3550 as weak stops were triggered through the 1.3540 area. The downside support having been thinned will see it replaced if the market can move towards the 1.3600 level however, the downside still has some stiff support down to the year’s lows before giving way to strong stops. Topside has offers from the 1.3580 and into the 1.3620 levels with only limited stops behind.
  • GBP: Opening around the 1.7088 levels and moved sideways not gaining the same traction as the Euro moving from an initial dip to below the 1.7080 levels before moving to just below the 1.7100 levels. Weak offers above the 1.7100 level to the 1.7120 area before light stops appear, the larger offers towards the 1.7170 levels still remain protecting the 1.7200 area. Although the market broke down below the 1.7050 levels the market still sees some weak bids remaining in the area protecting the point where the market broke higher at the end of June. Light stops are likely below the 1.7030 levels and into the 1.7000 levels, better bids then start to reappear towards the 1.6950 levels.
  • JPY: As the weekend Ukraine situation increased the safe haven JPY buying reappeared nothing massive just steady through the session dropping slowly back to the 101.23 areas as we move into the grey hours. Downside bids still remain moving down through the 101.20 levels and into the next handle to around the 100.80 level before weak stops appear however, chances are the bids will remain strong through to the years lows into 100.20.
  • AUD: The Oz remained in a tight range holding close to the 94 cents through the Sydney session before dipping in early Tokyo trades and the fix to 0.9385 areas before slowly moving back in quiet trading. Offers from the 0.9410 areas hold for the moment before weak stops through the 0.9430 levels opening up the 95 cent level. The other side is open to the 0.9340 area where stronger support starts to appear and cross buying is likely to play some part. A push through the levels opens up a big move back to the 92 cent with only minor congestion in between.

Overnight News

RUB:

Putin Says Russia Will Do All It Can to End Fighting in Ukraine

UN:

UN Security Council Expresses ‘Serious Concern’ Over Gaza

JPY:

Japan Plans to Maintain Cap on Bond Sales, Nikkei Says

JPY/VND:

Japan’s Sojitz Considers Vietnam Industrial Park Investment: VIR

NZD:

N.Z. Permanent Immigrant Arrivals Rise to Record 100,780

GBP:

Asking prices for UK homes fall for first time in 2014-Rightmove

U.K. Plans Changes to Pension Tax Rules to Increase Flexibility

GBP/EUR/RUB:

UK Said to Seek EU Ban on Defence Equipment Exports to Russia

 

Today’s data

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

GBP       Rightmove House Prices M/M Jul A -0.80% | P 0.10%

06:00     EUR        German PPI M/M Jun C 0.00% | P -0.20%

06:00     EUR        German PPI Y/Y Jun A -0.70% | P -0.80%

 

Weekend News

USD/RUB:

Obama Says Malaysia Jet Hit From Rebel-Held Area in Ukraine
U.S. Presses Russia to Ensure Access to Aircraft Crash Site
USD/EUR/RUB:

Obama Sees Attack on Plane as Wake-Up Call for Europe on Russia
EUR/GBP/RUB:

EU Urged to Revise Russia Stance as Cameron, Rutte Discuss Crash
MYR:

Malaysian Officials Head to Kiev to Gain Access to MH17 Site
EUR:

Espirito Santo International Asks for Protection From Creditors
Italy May Cut EU-Project Co-Financing to Save EU12b: Repubblica
German Government to Step Up Counter Intelligence, Spiegel Says
GBP:

U.K. Growth Broadens as Economy Finds ‘Sweet Spot,’ EY to Say
JPY:

Japan Banks’ Bad Lending Falls to Lowest Since 1999: Mainichi
Abe to Submit Japan Regional Revitalization Bill in fall: Kyodo
Japan to Build Trial Storage Battery Facility in Osaka: Yomiuri
JPY/INR:

India’s Modi to Meet Japan’s Abe on Sept. 1, Yomiuri Reports
JPY/BRL:

Japan to Support Brazil Deep-Sea Oil Project: Nikkei
ILS: Israel Expands Ground Offensive as Death Toll in Gaza Tops 340
TRY/RUB:

Turkey May Form Free-Trade Zone with Russia, RIA Novosti Says

Harry Hindsight

  • EUR: The market opened around the 1.3528 areas before slipping back with reasonable selling in EURJPY from Sydney onwards forcing the Euro to below the 1.3515 into the Tokyo session. From then on the market reversed and spent most of the session around the 1.3525 levels. London moved to the highs for the day just above the 1.3535 before drifting back to the 1.3525 areas. The move into the NYK session saw strong USD buying against both GBP and Euro however, with strong support in the market the movement was limited to a move to just below 1.3495 levels as the geopolitical tensions continue into the US morning. The market recovered over the course of the balance of the session but it took a lot longer to rise.
  • GBP: After early safe haven flows took GBP lower the Cable managed to rise from the 1.7085 levels back through the opening 1.7100 levels steadily through the Asian session. London continued the movement taking the market to above the 1.7115 levels before the issues around the world saw USD’s rise against the currencies across Europe. Cable took the brunt of the move with the Euro we supported Cable caved in through the lows and triggering stops on a move through the 1.7080 levels and again through the 1.7050 levels as support disappeared and opened up the downside, having hit below the 1.7040 levels before spending the rest of the session rallying back to around the breakdown levels.
  • JPY: Early safe haven flows were soaked up by the support as the Japanese retail sector moved into the market pushing steadily through the early session to the 101.30 levels from the lows just below 101.10. Once the fix was finished with the minor step back was recovered and the market moved to above the 101.40 and then held around the 101.35. London took over and the market tested the 101.45 levels a few times and the market held in a narrow range of 101.30-45 over the course of the day to finish around the 101.35 as the balance of safe haven selling against a USD rally left the market fairly flat.
  • AUD: After the fall back in the cross Yen into the Sydney session dipping to 0.9338 before moving steadily higher through the session as AUDJPY was driven steadily higher and into the NYK session where the market in Oz moved strongly to the 0.9385 level and held into NYK, NYK saw the whipsaw of the Oz with poor numbers overall moving quickly to above the 0.9410 level as the market tried to grasp the import of the new released at that point before dipping back to 0.9365 and a steady rise back towards the 0.9400 levels.

Friday’s premiership results

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

EUR        Eurozone Current Account (EUR) May A 19.5B | C 24.3B | P 21.5B | R 21.6B

CAD       Wholesale Sales M/M May A 2.20% | C 0.70% | P 1.20% | R 1.40%

CAD       CPI M/M Jun A 0.10% | C 0.10% | P 0.50%

CAD       CPI Y/Y Jun A 2.40% | C 2.40% | P 2.30%

CAD       BoC CPI Core M/M Jun A -0.10% | C -0.10% | P 0.50%

CAD       BoC CPI Core Y/Y Jun A 1.80% | C 1.70% | P 1.70%

USD       U. of Michigan Confidence Jul (P) A 81.3 | C 83 | P 82.5

USD       Leading Indicators Jun A 0.30% | C 0.50% | P 0.50%

 

Stay lucky

Andy

 

 

LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

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