Andy Harrison
Good morning,
LMAX Close
USDJPY 121.357 | EURUSD 1.10939 | AUDUSD 0.78752 | NZDUSD 0.73169 | USDCAD 1.22087 | USDCHF 0.93686 | GBPUSD 1.55358 |
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Interbank Ranges as of 6am London time
Highs   Lows
USD/JPYÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 121.39 | 121.03
EUR/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.11295 | 1.1085
EUR/JPYÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 134.79 | 134.525
AUD/USDÂ Â Â Â Â Â Â Â Â Â Â 0.7909 | 0.7866
NZD/USDÂ Â Â Â Â Â Â Â Â Â Â Â 0.7338 | 0.7296
USD/CADÂ Â Â Â Â Â Â Â Â Â Â Â 1.2211 | 1.2187
EUR/CHFÂ Â Â Â Â Â Â Â Â Â Â Â Â 1.0397 | 1.0388
USD/CHFÂ Â Â Â Â Â Â Â Â Â Â Â 0.93725 | 0.9338
GBP/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.5560 | 1.5530
EUR/GBPÂ Â Â Â Â Â Â Â Â Â Â Â 0.7154 | 0.7141
For today
- EUR: Steady EURJPY buying through the session helped the Euro to move off the 1.1090 levels through the session and trade to the 1.1120’s in very quiet trading. Topside offers into the 1.1150 areas are likely to hold weak stops through the levels leaving the 1.1200 again exposed technically however, the real question is the Greek story of more import or the fact that US rate rises are not likely to be seen until the back end of the year. A push through the 1.1200 areas will see light offers continue with a mixture of stops before stronger offers appear into the 1.1250 areas. Downside bids into the 1.1080 level and lighter continuing to the 1.1050 area a break here will open up a test of the 1.1000 levels and possibly strong stops through the level.
- GBP: Cable followed the Euro higher from the opening 1.5530 levels and pushed into the 1.5560 area before drifting a little, and heading into the London session holding around the 1.5550 levels. Downside bids into the 1.5450 areas sees some congestion and for the moment is the strongest point in the market with a push through the level negating a good proportion of the move up and exposing the downside for a further test into the 1.5350 levels. Topside offers into the 1.5600 level are likely to be weak however, stops through the level opens up further tests to the 1.5700 areas, this of course is all dependent on the retail sales numbers early in the session.
- JPY: USDJPY was under pressure from the opening slipping back from just below the 121.40 levels in a steady move into Tokyo to move below the 121.10 levels before generally holding the level through the session as a mixture of profit taking and exporter selling limited the market, light offers in EURJPY into the 134.80 areas and a rising Euro helped pin the USDJPY late into the Tokyo session. Topside offers in USDJPY continue probably all the way through to the 122.00 areas with those offers likely to increase through the 121.70 levels and particularly strong into and likely through 122.00, a strong push through that level will likely see break out stops and fresh buying appear in the market possibly beyond 122.20-30 before a renewal of offers appear however, this opens the topside for a move towards the end of year targets for most of 124-125. Downside bids are light into the 121.00 areas with a push through the 120.70 levels likely to see weak stops in the market triggered and the market open to a test back to the 120.00 areas. The downside then becomes more limited and the bids increase into the 119.80 levels and only a push through the 119.50 level will open up further downside potential.
- AUD: The Oz for the moment seems to be at the mercy of the carry trade AUDJPY, which has held in the 95-96 levels for the week and movement in the USDJPY has generally dictated the direction of the Oz, and today was little different with the Oz gradually moving to above the 79 cent levels as the USDJPY slipped from its opening levels, as with the other pairs though action has been limited somewhat and is not likely to move to much until the Eurozone PMI’s and initial claims in the US are out of the way. Topside offers light through the 0.7930 levels and a push through 0.7940 will open up another test to the 80 cent levels and weak stops through the level. Downside bids into the 0.7860 areas and a push through 0.7850 will see only light bids through to a test below the 78 cent level and an opening to last month’s ranges.
Overnight News                                                                                                                        Â
JPY:
BOJ to Consider Upgrading Economic Assessment, Nikkei Says
Japanese Bought Net 1099.2 Billion Yen Overseas Debt Last Week
Markit/JMMA Japan May Flash Mfg PMI 50.9 vs 49.9 in April
Japan’s Lower House Approves Yukitoshi Funo for BOJ Board Seat
Japan March All Activity Index Falls 1.3% M/m; Est. -0.4%
CNY:
HSBC China May Flash Manufacturing PMI 49.1; Est. 49.3
China Looks at Boosting Currency Swap With Latam Countries: Li
CNY/USD:
China Warns U.S. Surveillance Plane Over Spratlys, CNN Reports
NZD:
New Zealand Projects Smaller Budget Surpluses as Growth Slows
N.Z. Budget Supports Aaa Rating, Stable Outlook, Moody’s Says
N.Z. Has First Net Immigration From Australia Since 1991
Today’s data
Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT
AUDÂ Â Â Â Â Â Consumer Inflation Expectation May A 3.60% | P 3.40%
JPYÂ Â Â Â Â Â Â Â Manufacturing PMI May (P) A 50.9 | C 50.3 | P 49.9
CNYÂ Â Â Â Â Â Â HSBC Manufacturing PMI May (P) A 49.1 | C 49.4 | P 48.9
JPYÂ Â Â Â Â Â Â Â All Industry Activity Index M/M Mar A -1.30% | C -0.50% | P 0.10%
07:00Â Â Â Â EURÂ Â Â Â Â Â Â France Manufacturing PMI May (P) C 48.5 | P 48
07:00Â Â Â Â EURÂ Â Â Â Â Â Â France Services PMI May (P) C 51.9 | P 51.4
07:30Â Â Â Â EURÂ Â Â Â Â Â Â Germany Manufacturing PMI May (P) C 52.1 | P 52.1
07:30Â Â Â Â EURÂ Â Â Â Â Â Â Germany Services PMI May (P) C 53.9 | P 54
08:00Â Â Â Â EURÂ Â Â Â Â Â Â Eurozone Manufacturing PMI May (P) C 51.8 | P 52
08:00Â Â Â Â EURÂ Â Â Â Â Â Â Eurozone Services PMI May (P) C 53.9 | P 54.1
08:00Â Â Â Â EURÂ Â Â Â Â Â Â Eurozone Current Account (EUR) Mar C 24.3B | P 26.4B
08:30Â Â Â Â GBPÂ Â Â Â Â Â Retail Sales M/M Apr C 0.40% | P -0.50%
10:00Â Â Â Â GBPÂ Â Â Â Â Â CBI Trends Total Orders May C 3 | P 1
12:30Â Â Â Â USDÂ Â Â Â Â Â Initial Jobless Claims (MAY 16) C 270K | P 264K
14:00Â Â Â Â USDÂ Â Â Â Â Â Philly Fed Survey May C 8 | P 7.5
14:00Â Â Â Â EURÂ Â Â Â Â Â Â Eurozone Consumer Confidence May (A) C -4.8 | P -4.6
14:00Â Â Â Â USDÂ Â Â Â Â Â Existing Home Sales Apr C 5.22M | P 5.19M
14:00Â Â Â USDÂ Â Â Â Â Â Leading Indicators Apr C 0.30% | P 0.20%
Harry Hindsight             Â
- EUR: Euro’s dipped into the Tokyo session having opened around the 1.1150 areas moving into the 1.1120’s as the market eased back on Greek worries and QE rumours of early increases. From the initial selling reasonable EURJPY cross selling moved into the market and the Euro reversed the moves to hold in the 1.1140’s into the grey hours. Comments from Greek ministers suggested that a no deal with Europe would leave it unable to pay the next tranche of the IMF repayments, this sent the market lower into the London opening and the Euro’s quickly moved through the 1.1100 levels and into the 1.1070’s triggering some weak stops but finding sufficient support to recover to the 1.1120 areas, German PPI numbers disappointed and the market was limited by the numbers, the move into the NYK session saw fresh buying in the EURJPY cross and the market in the Euro again headed briefly to the opening levels. The session became fairly choppy through the NYK period moving off the 1.1140’s and back into the 1.1080 areas and back with the FOMC having some impact on the day’s events but not really telling the market anything it didn’t already know. This eventually left the market below the 1.1100 levels into the close for the day.
- GBP: Cable moved quietly through the Asian session tracking the Euro for the most part opening around the 1.5510 areas and drifting only slightly through the 1.5500 areas before rebounding and pushing above the 1.5520 levels. The move into London saw some steady selling in front of the MPC announcement and although the result was unchanged the two dissenters did make limited representations for the case to hike sooner rather than later. This saw the Cable pushing off the lows around the 1.5480 levels and moving steadily into the NYK session to push to the 1.5590 levels before giving up the topside and drifting back to the 1.5540 levels into the none eventful FOMC, some minor gyrations with the Cable initially pushed below the 1.5500 levels before bouncing back to above the 1.5560 level and then back to the 1.5530-40’s to the close.
- JPY: USDJPY opened in the 120.70 levels and looked set for a slow day before the FOMC late in the session, as it was things changed with a good fixing demand sending the market to the 120.90 levels and then a continual two battle through the session, so right idea wrong time, the move into London saw the market steadily eroding those topside offers and into the London opening testing above the 121.00 level for the first time, again the offers were strong enough to hold and the market drifted back to the 120.80 areas into the NYK session before the USD again started to press steadily higher and the 121.00 melted away and the market traded in a tight channel to the 121.40 levels, the release of the FOMC saw the market attempt the 121.50 levels before quickly dropping back through 121.00 in a quick movement before again rising to above 121.30 into the close.
- AUD: The Oz made light early gains fromj the opening 0.7915 areas to trade above the 0.7930 levels however, the move into the London session saw the market drop back as the USD rose against most currencies into the day, dipping to the 0.7890 levels the market then held the level for most of the day and only gave ground as the USDJPY moved higher and the market adjusted to keep the carry trade in line. The move towards the FOMC saw the market dip again and hold the 0.7870 levels before the choppy period on the FOMC release dipping only slightly lower and rising back to the 79 cent levels before a steady drift into the close to finish again on the lows.
Yesterday’s premiership results
Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT
JPYÂ Â Â Â Â Â Â Â GDP Q/Q Q1 (P) A 0.60% | C 0.40% | P 0.40%
JPYÂ Â Â Â Â Â Â Â GDP Deflator Y/Y Q1 (P) A 3.40% | C 3.60% | P 2.40%
AUDÂ Â Â Â Â Â Westpac Consumer Confidence May A 6.40% | P -3.20%
EURÂ Â Â Â Â Â Â German PPI M/M Apr A 0.10% | C 0.20% | P 0.10%
EURÂ Â Â Â Â Â Â German PPI Y/Y Apr A -1.50% | C -1.40% | P -1.70%
GBP      MPC Official Bank Rate Votes A 0–0—9 | C 0–0—9 | P 0–0–9
GBP      MPC Asset Purchase Facility Votes A 0–0—9 | C 0–0—9 | P 0–0–9
CHFÂ Â Â Â Â Â Â ZEW (Expectations) May A -0.1 | P -23.2
CADÂ Â Â Â Â Â Wholesale Sales M/M Mar A 0.80% | C 0.30% | P -0.40%
USDÂ Â Â Â Â Â Crude Oil Inventories A -2.7M | C -1.3M | P -2.2M
Good Luck,
Andy
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