Andy Harrison
Good morning,
LMAX Close
USDJPY 123.395 | EURUSD 1.12836 | AUDUSD 0.77655 | NZDUSD 0.69959 | USDCAD 1.23241 | USDCHF 0.92945 | GBPUSD 1.56008 |
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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 123.815 | 123.32
EUR/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.1284 | 1.1262
EUR/JPYÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 139.44 | 139.05
AUD/USDÂ Â Â Â Â Â Â Â Â Â Â 0.7781 | 0.7743
NZD/USDÂ Â Â Â Â Â Â Â Â Â Â Â 0.7010 | 0.6987
USD/CADÂ Â Â Â Â Â Â Â Â Â Â Â 1.2332 | 1.2312
EUR/CHFÂ Â Â Â Â Â Â Â Â Â Â Â Â 1.04945 | 1.0480
USD/CHFÂ Â Â Â Â Â Â Â Â Â Â Â 0.9316 | 0.92905
GBP/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.5615 | 1.5587
EUR/GBPÂ Â Â Â Â Â Â Â Â Â Â Â 0.7230 | 0.7220
For today
- EUR: Rhetoric continued from the Greeks with a statement that no further deals will be tabled by them and it will be up to the Eurogroup to furnish the accommodation required for a deal to be set or so it would seem, question is will it be a political solution or financial with the latter being along way apart at the moment. The market slowly slipped from the opening levels in the mid 1.1280’s slowly drifting down to the mid 1.1260’s before the market found limited interest from the JPY and EURJPY buying reversing the losses and pushing back to the 1.1280’s into the grey hours. Topside offers light into the 1.1300 areas with the possibility of only a small amount of weak stops before the offers again move in with strong selling from the 1.1320 levels to around the 1.1350 area, with no real stops expected on the 1.13 handle to the topside the market would need to push a long way to find them and the offers could very well contain the market unless a deal is struck. Downside bids are likely to be light into the 1.1250 areas and continue to possibly better bids from the 1.1220 levels, more commentary and/or outright breakdown will quickly see these swept away and the market opening to test below the 1.1180 areas and possible stops through 1.1170 with again the market a little thin once the market is through and the better bids likely to be congregated around the 1.1100 levels but exposing the downside for a deeper move.
- GBP: Cable did very little over the session following the Euro for the most part and losing only slightly in the cross EURGBP, opening around the 1.5600 levels the market initially followed the Euro lower through the 1.5590 levels before rallying on GBPJPY buying after comments from Kuroda into the Tokyo session, for the moment the market hangs around the 1.5610 levels moving into the London session. Topside offers are now likely to be light over the next 20-30 pips however the market is likely to show some resistance moving into the 1.5650 levels and a strong push to the 1.5700 will see less resistance once through. Downside bids light through the 1.5550 areas with the pattern likely to repeat down over the next 50 pips with weak stops a possibility through the 1.5500 areas and exposing a deeper test to the 1.5400 levels and better bids.
- JPY: The market opened around the 123.40 areas and looked set for another day being cautious, that was before Kuroda hit the wires reversing or trying to undo the speech from last week, and while the market reacted to the commentary, it did less damage than it did coming down with a quick rise to the 123.80 levels before dipping back to hold only some 10 pips above where it had already traded too, the downside saw selling leading up to the commentary with expectations of Kuroda repeating his comments however, it would now seem that there is more concern over the rise of the Nikkei rather than the weakness of the JPY for the moment at least however, for me the comments of last week did what they were supposed to do and deflected the market from a possible break out through the 126 levels and now it’s away from those levels there is space for them to breath. Topside offers into the 123.80 levels as you would expect however, the move through may see some light weak stops before the selling moves in again with congestion then running from around the 124.20 areas and into the 124.50 level, only a push through the 125.00 will open the market for further tests to the topside and there again I’d expect a running commentary on watching FX levels. Downside bids through the 123.00 areas and down to the 122.50 area with yield buying likely to be interested in buying however, a dip in the Nikkei and then a dip in USDJPY could see margin liquidation and we’d only need the Gold to move the wrong way and the Yield players would be exposed to some aggressive selling, with 122.50 out of the way there is really nothing to protect the downside until the market dips through 122.00 and starts to move towards the 121.50 levels and then possible support could appear through to 121.00.
- AUD: A reasonably quiet session for the Oz moving from the opening 0.7760 levels to dip in the early part of Tokyo to below 0.7750 before the market saw some choppy trading around the Kuroda comments, touching above the 0.7780 levels and back into the 0.7750 as AUDJPY carry drove the market around, the market again settled down to trade around the 0.7760 levels and move into the grey hours starting to sag a little from that level. Topside offers remain into the 0.7780 levels moving through to 0.7800-20 before the market could see a move to the topside with possible weak stops and light breakout trades in the market however, the market is then likely to struggle with congestion to the 0.7850 areas before it truly opens for a test into the previous ranges that led to the highs in May. Downside bids reasonably light into the 77 cent level however, the market then starts to see strength appearing on the bid side the closer you move to the 0.7650-0.7550 levels and with only UK inflationary data of major concern today the market is likely to be dominated by the JPY.
Overnight News                                                                                                                        Â
JPY:
Kuroda Says He Wasn’t Trying to Influence Yen Exchange Rate
Kuroda: Didn’t Mean to Predict Future Nominal FX Rate
Japan Post May Share ATM Network with Local Banks: Nikkei
AUD:
RBA Repeats That Further A$ Drop Is ‘Likely and Necessary’
Debelle: Scope for More Australia Financial Integration in Asia
Australia ANZ Weekly Consumer Sentiment Rises 2.1% to 114.5
AUD/CNY:
Abbott Allows Too Much Chinese Investment in Real Estate: Poll
EUR:
Varoufakis Won’t Submit Any New Reform Proposals, Bild Reports
German Federal Board Member Says Greece Won’t Repay Debts: Bild
KRW/JPY:
- Korea Not Ready to Sign Intelligence-Sharing Pact with Japan
CNY:
China PBOC Said to Let Private Funds into Interbank Bond Market
Today’s data
Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT
05:45Â Â Â Â CHFÂ Â Â Â Â Â Â SECO June 2015 Economic Forecasts
06:00Â Â Â Â EURÂ Â Â Â Â Â Â German CPI M/M May (F) C 0.10% | P 0.10%
06:00Â Â Â Â EURÂ Â Â Â Â Â Â German CPI Y/Y May (F) C 0.70% | P 0.70%
08:30Â Â Â Â GBPÂ Â Â Â Â Â CPI M/M May C 0.20% | P 0.20%
08:30Â Â Â Â GBPÂ Â Â Â Â Â CPI Y/Y May C 0.10% | P -0.10%
08:30Â Â Â Â GBPÂ Â Â Â Â Â Core CPI Y/Y May C 1.00% | P 0.80%
08:30Â Â Â Â GBPÂ Â Â Â Â Â RPI M/M May C 0.30% | P 0.40%
08:30Â Â Â Â GBPÂ Â Â Â Â Â RPI Y/Y May C 1.10% | P 0.90%
08:30Â Â Â Â GBPÂ Â Â Â Â Â PPI Input M/M May C 0.60% | P 0.40%
08:30Â Â Â Â GBPÂ Â Â Â Â Â PPI Input Y/Y May C -11.30% | P -11.70%
08:30Â Â Â Â GBPÂ Â Â Â Â Â PPI Output M/M May C 0.10% | P 0.10%
08:30Â Â Â Â GBPÂ Â Â Â Â Â PPI Output Y/Y May C -1.60% | P -1.70%
08:30Â Â Â Â GBPÂ Â Â Â Â Â PPI Output Core M/M May C 0.00% | P 0.00%
08:30Â Â Â Â GBPÂ Â Â Â Â Â PPI Output Core Y/Y May C 0.10% | P 0.10%
09:00Â Â Â Â EURÂ Â Â Â Â Â Â Eurozone Employment Q/Q Q1 C 0.10% | P 0.10%
09:00Â Â Â Â EURÂ Â Â Â Â Â Â German ZEW (Current Situation) Jun C 63 | P 65.7
09:00Â Â Â Â EURÂ Â Â Â Â Â Â German ZEW (Economic Sentiment) Jun C 37.3 | P 41.9
09:00Â Â Â Â EURÂ Â Â Â Â Â Â Eurozone ZEW (Economic Sentiment) Jun C 60.3 | P 61.2
12:30Â Â Â Â USDÂ Â Â Â Â Â Housing Starts May C 1.10M | P 1.14M
12:30Â Â Â USDÂ Â Â Â Â Â Building Permits May C 1.11M | P 1.14M
12:30Â Â Â CADÂ Â Â Â Â Â International Securities Transactions (CAD) Apr P 22.50B
Harry Hindsight                  Â
- EUR: With a nervous start to the week the market opened with a gap to the downside of some 40 pips then held in the area into the Tokyo session around the opening 1.1220 levels before dipping further to test below the 1.1200, recovering into the grey hours early Europe sold to test the lows again and this time the market managed to move a little further into the bids and test the 1.1190 level before bouncing into the London open and moving to just above 1.1260 with the early shorts squeezed out of the market, mixed CHF data saw the EURCHF rally before the Euro started to drift again, the move into the NYK session again saw the market pushing against the 1.1200 levels but the release of US data took the pressure off the Euro for the time being as the USD dipped and the Euro was able to rally steadily over the course of a quiet day to test above the 1.1290 levels and a quiet close around 1.1280.
- GBP: Cable struggled to keep the pressure to the topside and slipped in early trading following the Euro to some extent until deep into the Asian session where the GBP started to lose ground against the Euro, the market having opened in the 1.5550 areas slipped only to the 1.5540-30 area and traded into the London session holding those levels, the Eur/cross saw plenty of early action with EURGBP and EURCHF doing a little work to help the Euro higher however, the Cable was forced to test through the 1.5500 levels and eventually started a recovery from the 1.5490 areas into the NYK session and traded steadily to test through the 1.5610 area late into the session before drifting into the close, as with the Euro though the market seemed to be very quiet although a respectable range and one suspects that trading is being stymied by the Greek concerns and the market unable to second guess whether the Greeks are bluffing, out of ideas and in a corner or intended to back themselves there to save face if there was an exit.
- JPY: Range trading after a weak start with plenty of EURJPY selling in the pre-market saw the USDJPY open around the 123.25 areas and then a steady rise through the session to test into mid London above the 123.65 level before the US numbers weakened the pair again, even so after the Kuroda comments last week the market seems less inclined to push too far and for the most part traded around the 123.40-50 levels for great periods of the Asian session and NYK session.
- AUD: The Oz opened higher with cross EURAUD going through in pre-market trading however, having opened above the 0.7750 levels concerns over the general economic situation with an increasing property bubble and falling revenue from exports the market soon took the market down to the closing levels from Friday and once the Tokyo market opened the follow through took the market to the 0.7710-20 levels to trade into the London session, AUDJPY carry trade buying moved in during the London session and the Oz moved up to test into the 0.7770 levels and the resistance however, although it was unable to move any higher the Oz remained fairly strong and ended the day holding much of its gains in a lacklustre day overall.
Yesterday’s premiership results
Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT
GBPÂ Â Â Â Â Â Rightmove House Prices M/M Jun A 3.00% | P -0.10%
CHFÂ Â Â Â Â Â Â Producer & Import Prices M/M May A -0.80% | C 0.10% | P -2.10%
CHFÂ Â Â Â Â Â Â Producer & Import Prices Y/Y May A -6.00% | C -5.10% | P -5.20%
CHFÂ Â Â Â Â Â Â Retail Sales (Real) Y/Y Apr A 1.60% | C -2.20% | P -2.80%
EURÂ Â Â Â Â Â Â Eurozone Trade Balance (EUR) Apr A 24.3B | C 19.0B | P 19.7B | R 19.9B
CADÂ Â Â Â Â Â Manufacturing Shipments M/M Apr A -2.10% | C -0.50% | P 2.90% | R -2.70%
USDÂ Â Â Â Â Â Empire State Manufacturing Jun A -2 | C 6 | P 3.09
USDÂ Â Â Â Â Â Industrial Production May A -0.20% | C 0.20% | P -0.30%
USDÂ Â Â Â Â Â Capacity Utilization May A 78.10% | C 78.30% | P 78.20%
USDÂ Â Â Â Â Â NAHB Housing Market Index Jun A 59 | C 56 | P 54
USDÂ Â Â Â Â Â Net Long-term TIC Flows Apr A $53.9B | C $22.5B | P $17.6B | R $25.6B
Good Luck,
Andy
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