Andy Harrison
Good morning,
LMAX Close
USDJPY 122.683 | EURUSD 1.13239 | AUDUSD 0.77627 | NZDUSD 0.72014 | USDCAD 1.22568 | USDCHF 0.93154 | GBPUSD 1.55303 |
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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 123.29 | 122.63
EUR/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.1335 | 1.1284
EUR/JPYÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 139.35 | 138.845
AUD/USDÂ Â Â Â Â Â Â Â Â Â Â 0.7793 | 0.7698
NZD/USDÂ Â Â Â Â Â Â Â Â Â Â Â 0.7180 | 0.7010
USD/CADÂ Â Â Â Â Â Â Â Â Â Â Â 1.2286 | 1.2253
EUR/CHFÂ Â Â Â Â Â Â Â Â Â Â Â Â 1.0550 | 1.05305
USD/CHFÂ Â Â Â Â Â Â Â Â Â Â Â 0.9336 | 0.9310
GBP/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.5532 | 1.5490
EUR/GBPÂ Â Â Â Â Â Â Â Â Â Â Â 0.7302 | 0.7285
For today
- EUR: Euro’s steadily slipped through the session easing from the opening around the 1.1325 levels and easing into the Tokyo session dipping through the 1.1320 and continuing its decent steadily through the 1.1300 level to find support into the 1.1280 areas and recovering a little as the market moved to the grey hours. Topside offers into the 1.1380 levels and through the 1.1400 area, the offers are likely to continue further with those offers likely to continue towards the 1.1500 building in size with possible option barriers. Downside bids into the 1.1260-50 areas before opening a little into the 1.1220 and possibly better bids before the market breaks down through 1.1170 levels and opens a test of the 1.1100 areas again.
- GBP: A slow drift for the Cable from the opening 1.5330 levels and dipping to trade around the 1.5500 levels for much of the session. Topside offers likely to appear around the 1.5550 levels and increasing to the 1.5600 areas before the market truly opens up for a test to the highs from May. Downside bids light into the 1.5400 levels see continuing light bids through the level and into 1.5350 before the market opens up and has potential to test low, however, today is lacking in tier 1 data from the UK and the EUR areas so movement is likely to be contained to the movement in the Euro and Greece.
- JPY: The market has had several hours to digest yesterday’s comments and although its fairly mixed with people taking the comments as not exactly market intervention as they would normally expect however, it’s not been the first and probably not going to be the last, it had its desired effect and the USDJPY has today only tentatively moved higher, slow rising from the opening 122.70 areas to push gradually through the 123.00 levels into the Tokyo session and testing as high as 123.20 before spending several hours holding in between 123.00-15 and holding just above the figure into the grey hours. Downside bids seem to be into the 122.60-50 before the market opens for a return to the 121.00 areas and stronger bids, a poor retail sales number in the US the market is likely to be quiet. Topside offers are likely to be thin through the 123.20-40 levels; if the market has the impetus to rise a push through the level could find the market a little thin from there into the 124.00 level before offers are likely to thicken sufficiently to slow the market for any further moves.
- AUD: The Oz opened gapping lower around the 0.7750 after the RBNZ announcement to cut interest rates by 0.25% from 3.50% as the drag of the Kiwi pulled the market to the 0.7730’s in opening trading on the LMAX exchange, active AUD/NZD buying was sufficient to hold the market then around the 0.7740 areas before unnerved Tokyo traders moved in and slowly sold the Oz as the USDJPY rose, the market again dipped through to the 0.7710 levels before the release of the Oz employment/unemployment number hit the news and another good set sent the market quickly back to touch above the 0.7790 areas before holding around the 0.7770 levels in a quiet period of trading to the close. Offers into the 78 cent levels are likely to see a fair few short term players around and only a strong push through the 0.7840 area is likely to see any stops in that direction and the potential for the market to rise to the stronger 79 cent areas. Downside never changes for the moment and while the bids are thin into the 77 cent levels as soon as the market starts to test through the 0.7650 area the market is likely to find plenty willing to buy with the market possibly strong until a push through 75 cents.
Overnight News                                                                                                                        Â
AUD:
Australian May Employment Rose 42,000 M/M; Est. 15,000 Rise
NZD:
Wheeler: Market Shouldn’t Be Surprised by Today’s RBNZ Rate Cut
Wheeler Says RBNZ Cuts Rates, Further Easing Possible
New Zealand House Price Excluding Auckland Gains 2.6% Y/Y
JPY:
Japan growth strategy sets sights on shift to IT – draft – RTRS
Japanese Sold Net 385.2 Billion Yen Overseas Debt Last Week
Tokyo May Office Vacancies Fall to 5.17% From Month Earlier
CNY:
China May Industrial Output Rises 6.1% Y/y; Est. 6%
China Jan.-May Property Development Investment Rises 5.1% Y/y
China May Scrap Forex Purchase Cap for FTZ Account: Sec. Journal
China May Fiscal Revenue Rises 5% Y/y to 1.44t Yuan
Today’s data
Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT
NZDÂ Â Â Â Â Â RBNZ Rate Decision A 3.25% | C 3.50% | P 3.50%
GBPÂ Â Â Â Â Â RICS House Price Balance May A 34% | C 35% | P 33%
JPYÂ Â Â Â Â Â Â Â BSI Large Manufacturing Q/Q Q2 A -6 | C 3.2 | P 2.4
AUDÂ Â Â Â Â Â Consumer Inflation Expectation Jun A 3.00% | P 3.60%
AUDÂ Â Â Â Â Â Employment Change May A 42.0K | C 15.2K | P -2.9K
AUDÂ Â Â Â Â Â Unemployment Rate May A 6.00% | C 6.20% | P 6.20%
CNYÂ Â Â Â Â Â Â Retail Sales Y/Y May A 10.10% | C 10.20% | P 10.00%
CNYÂ Â Â Â Â Â Â Industrial Production Y/Y May A 6.10% | C 6.10% | P 5.90%
CNYÂ Â Â Â Â Â Â Fixed Assets Ex Rural YTD Y/Y May A 11.40% | C 12.00% | P 12.00%
12:30Â Â Â Â CADÂ Â Â Â Â Â New Housing Price Index M/M Apr C 0.20% | P 0.00%
12:30Â Â Â Â CADÂ Â Â Â Â Â Capacity Utilization Rate Q1 C 83.60% | P 83.60%
12:30Â Â Â Â USDÂ Â Â Â Â Â Advance Retail Sales May C 0.80% | P 0.00%
12:30Â Â Â Â USDÂ Â Â Â Â Â Retail Sales Less Autos May C 0.70% | P 0.10%
12:30Â Â Â Â USDÂ Â Â Â Â Â Import Price Index M/M May C 0.80% | P -0.30%
12:30Â Â Â Â USDÂ Â Â Â Â Â Initial Jobless Claims (JUN 6) C 277K | P 276K
14:00Â Â Â USDÂ Â Â Â Â Â Business Inventories Apr C 0.10% | P 0.10%
Harry Hindsight                  Â
- EUR: Opening around the 1.1280 levels the market eased into the 1.1270 before seeing good buying of the EURJPY into the Tokyo session, it rose to above the 1.1300 levels on the but once it had made its way there it ran out of steam and spent the rest of the session dropping back to the opening levels. Comments from BoJ’s Kuroda then turned a normal day into something different and the Euro again pushed into the 1.1300 levels and into the grey hours, early London were quick buyers on the initial move through the level but the official opening saw strong buying then started to enter the market with mixed comments from the Greeks and Eurogroup with the market thinking a deal was close only to find that no it hadn’t and there was to be more intense negotiations, one has to smile, and still no one has blinked and the market moved straight back from the highs above the 1.1380 and through to the 1.1320 levels before slowing and slipping further to push through the 1.1280 levels triggering weak stops and setting the days low in the 1.1260 area. NYK were light buyers to return the market back to the 1.1300 areas and the market saw a little choppy action through NYK before settling down to trade around the 1.1320 into the close.
- GBP: Cable traded very quietly through the Asian session and lifted only towards the end of the session with the comments from Kuroda helping the Cable move off the opening 1.5380 levels where it had traded with little movement through the session. Moving smartly higher it pushed through the 1.5400 levels and then spent the grey hours moving around the 1.5420 areas before the official opening saw further buying moving in and the market then staged step movements up 20 pips every few hours as the market continued to rally, a good set of IP, MP numbers helped to underpin the GBP strength with EURGBP cross falling from the early London highs above the 0.7360 levels and trading through into the NYK session sinking below the 0.7300 level and continuing to 0.7270 just before the end of London. Cable gradual rise pushed through the 1.5550 levels with little resistance before slipping back as the day moved on and eventually finished the day around the 155.30 levels into the close.
- JPY: A quiet day initially for the USDJPY moving quietly around the 124.40 levels, dipping into the 124.20’s to make initial lows and barely making it above the 124.40 areas through to late in the session when Kuroda made several comments basically suggesting that the weakness of the Yen was overdone however, as with early comments on any number of occasions the market reacted and dropped quickly from the 124.60 levels where the market had pushed to in late trading and didn’t look as if it was ever going to stop, pushing quickly through 124 and then 123 before finding sufficient bids into the 122.80 levels and slowing the market, the move into the London session saw the market becoming a little messy as the market bounced around the level for several hours, finding some impetus as the market moved towards the NYK session but failing to push beyond the 123.30 levels before again settling to trade the 122.80 areas and touching down to 122.60 as the market quietened and ranged to the close.
- AUD: Good confidence numbers one day and poor the next saw the Oz trade quietly before dipping on those numbers from Westpac with the market dipping from above the 77 cent levels and holding around the 0.7680 areas until RBA’s Stevens mentioned that the RBA still had the ability to cut rates and the market fell quickly to test into the waiting bids below 0.7650 and eventually holding the 0.7640 level until the Kuroda comments entered the market, Oz reacted to the sudden drop in the USDJPY and moved back to the 77 cent level and eventually pushed through the level and continued to the 0.7780 levels before finally running out of steam, NYK were sellers initially before the market picked up a little and moved to trade around the 0.7760 levels for the rest of the session.
Yesterday’s premiership results
Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT
JPYÂ Â Â Â Â Â Â Â Machine Orders M/M Apr A 3.80% | C -1.70% | P 2.90%
JPYÂ Â Â Â Â Â Â Â Domestic CGPI Y/Y May A -2.10% | C -2.20% | P -2.10%
AUDÂ Â Â Â Â Â Westpac Consumer Confidence Jun A -6.90% | P 6.40%
GBPÂ Â Â Â Â Â Industrial Production M/M Apr A 0.40% | C 0.20% | P 0.50% | R 0.60%
GBPÂ Â Â Â Â Â Industrial Production Y/Y Apr A 1.20% | C 0.60% | P 0.70% | R 1.10%
GBPÂ Â Â Â Â Â Manufacturing Production M/M Apr A -0.40% | C 0.10% | P 0.40%
GBPÂ Â Â Â Â Â Manufacturing Production Y/Y Apr A 0.20% | C 0.40% | P 1.10% | R 1.20%
GBPÂ Â Â Â Â Â NIESR GDP Estimate May A 0.60% | P 0.40% | R 0.50%
USDÂ Â Â Â Â Â Crude Oil Inventories A -6.8M | C -1.5M | P -1.9M
USDÂ Â Â Â Â Â Monthly Budget Statement May A -$82.4B | C -$100.5B | P $130.0B
Good Luck,
Andy
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