Daily FX Market Commentary

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 119.72 | EURUSD 1.08801 | AUDUSD 0.75928 | NZDUSD 0.74948 | USDCAD 1.25587 | USDCHF 0.95955 | GBPUSD 1.48282 |

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               119.78 | 119.60

EUR/USD             1.0886 | 1.0864

EUR/JPY               130.40 | 130.02

AUD/USD            0.7601 | 0.7571

NZD/USD             0.7519 | 0.7498

USD/CAD             1.2569 | 1.2557

EUR/CHF              1.0446 | 1.0433

USD/CHF             0.9610 | 0.9593

GBP/USD             1.4840 | 1.4821

EUR/GBP             0.7338 | 0.7326
For today

  • EUR: As you’d expect volumes are much reduced and the market is moving quietly with both Bank Holidays around the world and the prospect of NFP this evening, so a word of caution, with most players being on holiday they will have placed orders in the market and very little daily trading will be in the market so a good or bad figure could see the market reacting badly and nothing to support or resist a move, given previous volatile announcements (Jan 15) don’t rely on the banks to soak up all the pressure. The market moved from the opening 1.0880 level and slowly traded into the 1.0860’s before returning to the opening levels with no clear indication of the markets thinking other than lets hold back and wait. Topside offers are likely to be light into the 1.0900-20 levels and weak stops kick in above before stronger offers as you head to the 1.1000 levels however, the concern is that orders may not be there specifically the speculator ones and volatility and a lack of those players could see a short squeeze through the level. Downside bids are less certain with limited bids into the 1.0820-00 levels and likely to continue through to the 1.0760 level with less interest before opening up a move through 1.0700 and into stronger bids from the 1.0650 level onwards.
  • GBP: Very quiet with the market trading around the 1.4830 levels with the low just above 1.4820 but generally in a 15 pip range. Topside light offer into the 1.4900 levels likely to start from 1.4880 onwards before melting away and then limited liquidity to the 1.5000 level and stronger offers likely in the market that is apart from the day traders who are on the golf course. Downside bids are very light through the to the 1.4750 levels and while it has been fairly strong over the past month the downside could see the market move through to the lows of the 1.4650 area if numbers dictate.
  • JPY: The market in USDJPY saw limited action as the market drifted from the opening 119.75 areas and down to the 119.60 into the late session with no data and very little news to help the fun holiday session. Topside offers are limited to the 120.00 level with weak stops likely through the level before the market sees stronger offers as the market progresses towards the 121.00 level with 120.40 the start of stronger offers. Downside bids into the 119.40 levels and continue to the 119.00 levels before the market opens up for a test lower and only the chance of yield bids making an appearance.
  • AUD: The Oz initially saw light selling once the market moved into Tokyo however, it was light and the bounce back higher was more to do with limited balancing in AUDJPY as the USDJPY sagged a little and the market was able to move to the 76 cent level from lows into the 0.7570’s. Downside bids remain in the 0.7540 area however, they are likely to be lighter and 75 cent may be a target for both option plays and breakout traders if they haven’t gone fishing. Through 75 cents the market opens up to a larger fall into the 73/74 cent levels with likely only option plays for the day making any difference. Topside offers through the 76 cent level are thin at best and the market is open to the 0.7640 levels with a push through in normal circumstances of the 0.7650 area likely to open up the chance of a short squeeze, one to be careful of.

 

Overnight News

JPY:

Amari: still on steady path to exiting deflation

Amari: BoJ Kuroda’s bazooka has been unusually effective

Amari: Abe trip to US won’t be excuse to compromise on TPP

Amari: several TPP issues to address before the visit to the US.

EUR:

The UK’s Telegraph leads with Greece draws up drachma plans, preparing to miss IMF payment

CNY:

HSBC PMI Mar services 52.3 vs. 52 in Feb

 

Today’s data

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

12:30     USD       Change in Non-farm Payrolls Mar C 250K | P 295K

12:30     USD       Unemployment Rate Mar C 5.50% | P 5.50%

12:30    USD       Average Hourly Earnings M/M Mar C 0.20% | P 0.10%

 

Harry Hindsight              

  • EUR: Talk of a cooling economic growth in the US set the tone for the day and the Euro slowly managed to move higher once the market moved out of a dull Asian session, opening around the 1.0760 levels the market in Asia moved in a reasonably tight range trading down to the 1.0750 areas before steadily climbing higher into the grey hours, pushing to above the 1.0820 levels with a light triggering of stops through the 1.0800 level before holding in a tight range between 1.0820-40 for several hours, even initial claims did little for the market and the dip was quickly moved higher pushing to peak above the 1.0900 levels, worse than expected Factory orders was probably partially to blame but given it was an expansion with only consensus being wide of the mark. The market then traded quietly into the close ranging around the in the 1.0880-1.0900 level and never really managing to push through only to run out of time to settle around the 1.0880 level. The fact that April is historically weak for the USD nothing has changed for the moment.
  • GBP: Cable moved quietly through the Asian session moving from the opening 1.4820 levels to push the 1.4840 level a little, early London buying took the market to the 1.4870 levels before a weaker Construction PMI sent the Cable lower and a push steadily to the 1.4780 level, NYK bought back the Cable with mixed numbers in the US and concerns on the economic numbers appearing however, this just provided a last day of chop for the market with the market again bouncing through the NYK session with much reduced volumes causing problems through the session. The market eventually settled for the day pretty much unchanged.
  • JPY: USDJPY moved quietly over the day with a limited range, the market remained in a fairly tight range with the market opening around the 119.70 level and drifting to the 119.70 into early London, USDJPY moved higher with the initial Jobless number pushing to the 119.90 before falling back and ranging in a tight play around the 119.75 level into the close.
  • AUD: The Oz was the limited mover of the day with the market testing steadily lower over the course of the day and pushing into early London pressing the years lows, the move into NYK saw new lows set however, the futures market in particular saw reasonable profit taking and the market made only one real attempt to push deeper before the Factory order numbers deflected the USD and the market jumped back to the 0.7610 level from the lows below 0.7540 and that was the last time we saw the levels as the market ranged around the 0.7580-90 for the most part.

 

Yesterday’s premiership results

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

AUD       TD Securities Inflation M/M Mar A 0.40% | P 0.00%

JPY         Monetary Base Y/Y Mar A 35.20% | C 35.30% | P 36.70%

AUD       Trade Balance (AUD) Feb A -1.26B | C -1.25B | P -0.98B | R -1.00B

GBP       Construction PMI Mar A 57.8 | C 60.4 | P 60.1

USD       Challenger Job Cuts Y/Y Mar A 6.40% | P 20.90%

CAD       International Merchandise Trade (CAD) Feb A -1.0B | C -1.80B | P -2.45B | R -1.5B

USD       Initial Jobless Claims (MAR 28) A 268K | C 285K | P 282K | R 288K

USD       Trade Balance Feb A -35.4B | C -$41.0B | P -$41.8B | R -42.7B

USD       Factory Orders Feb A 0.20% | C 0.40% | P -0.20%

 

Good Luck, and watch out for the fluffy bunnies

Andy

 

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LMAX Exchange Market Commentary   AUDUSD   Andy Harrison  

Any opinions, news, research, analyses, prices or other information ("information") contained on this Blog, constitutes marketing communication and it has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Further, the information contained within this Blog does not contain (and should not be construed as containing) investment advice or an investment recommendation, or an offer of, or solicitation for, a transaction in any financial instrument. LMAX Group has not verified the accuracy or basis-in-fact of any claim or statement made by any third parties as comments for every Blog entry.

LMAX Group will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. No representation or warranty is given as to the accuracy or completeness of the above information. While the produced information was obtained from sources deemed to be reliable, LMAX Group does not provide any guarantees about the reliability of such sources. Consequently any person acting on it does so entirely at his or her own risk. It is not a place to slander, use unacceptable language or to promote LMAX Group or any other FX and CFD provider and any such postings, excessive or unjust comments and attacks will not be allowed and will be removed from the site immediately.