Andy Harrison
Good morning,
LMAX Close
USDJPY 120.714 | EURUSD 1.10772 | AUDUSD 0.74293 | NZDUSD 0.6721 | USDCAD 1.2746 | USDCHF 0.94554 | GBPUSD 1.53608 |
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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 | 120.47
EUR/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.1081 | 1.1063
EUR/JPYÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 134.405 | 133.39
AUD/USDÂ Â Â Â Â Â Â Â Â Â Â 0.7476 | 0.7393
NZD/USDÂ Â Â Â Â Â Â Â Â Â Â Â 0.6755 | 0.6699
USD/CADÂ Â Â Â Â Â Â Â Â Â Â Â 1.2745 | 1.2710
EUR/CHFÂ Â Â Â Â Â Â Â Â Â Â Â Â 1.0469 | 1.0462
USD/CHFÂ Â Â Â Â Â Â Â Â Â Â Â 0.9462 | 0.94455
GBP/USDÂ Â Â Â Â Â Â Â Â Â Â Â 1.5385 | 1.5359
EUR/GBPÂ Â Â Â Â Â Â Â Â Â Â Â 0.7208 | 0.7198
For Today
- EUR: With two unknown situations the results of which are difficult to gauge the Euro’s has seen liquidation over the past month or so and increasing over the past week, EURJPY in particular has seen plenty of selling however, the Euro has continued to hold above the earlier lows of the year and while the prospect of Grexit has been rumbling along for several months the Chinese financial crisis is a new event with a slowing economy and the asset market meltdown as always difficult to see the ramifications, for the moment China is effecting the Asian areas however, recent selling in the equity markets could be attributed to the Greek situation as much as China. Today saw a respite in most of the markets with equities in the far east holding and looking a lot more green than in the past few days however, another 300 companies suspended there stocks from trading and the total is now around 1700 or 60% of the A list shares. Opening around the 1.1075 levels the market has traded in a tight range through the session dipping into the 1.1060’s in early Tokyo before testing to the 1.1080 levels in very quiet trading for the pair, Topside offers likely to the 1.1100 areas and a push through the 1.1120 areas will likely see only a brief moment of stops before light offers appear around the 1.1150 areas and continuing into the 1.1180 levels and stronger resistance above the 1.1200 levels. Downside bids light into the 1.1000 areas with the likelihood of stops through the 1.0970 levels opening another test of a stronger bidding area around the 1.0920-00 areas before the market opens to a test through the 1.0870 areas.
- GBP: Cable opening around the 1.5360 levels and eventually started to tic a little higher to press above the 1.5380 levels before spending a lot of time in that area to move towards the grey hours, Topside offers light into the 1.5400 areas and opens to a stronger 1.5450 with likely weak stops through the level, before approaching 1.5500 and more offers, with the market adjusted for the time being and the BoE decision not likely to break from the norm for the moment the market is likely to continue to move with the Euro, Downside bids into the 1.5320-30 areas and then 1.5300 levels will likely see strong stops on a move through the level and only light bids to the 1.5250 areas and 1.5200 looking to be a key level for an approach to the 1.5000 areas.
- JPY: USDJPY opened around the 120.70 areas and initially tested towards the previous days lows before Tokyo opened, early traders were steady buyers into Tokyo pushing through to the 120.90 levels before the Oz employment numbers again saw a rise and AUDJPY buyers appeared in the market and the USDJPY kept pace with the rise pushing through the weak 121.00 levels to trigger weak stops and a push through the 121.20 levels before running out of steam and holding in that area into the grey hours. While we have seen plenty of cross/JPY selling in the market it is worth noting that the flows to yield continues with some $2bln bought in the previous week alone and marks the 33rd week of continued outflows. Topside light offers to the 121.60 areas are likely to start increasing into the 122.00 levels however, I would suspect the levels are not up to the usual standards and any impetus will open up a move to the 122.80 levels and stronger offers through to 123.20 before stops are likely to make a significant impact. Downside bids for the moment stretch from the current lows of 120.50 down into the 119.80 areas with a possibility of stops being mixed in along the way and then running into a lot of congestion from the ranges through March to May with 119.00 roughly being the preferred buying area for the Yield players back then.
- AUD: The Oz having recovered some of the lost ground opened around the 0.7430 levels and the move into Tokyo saw the market acting a little jittery with the employment numbers due with the market falling to the 74 cent levels with fresh selling of AUDJPY probably the main influence, the market did recover having made fresh lows of 89.20 in the carry trade however, the employment numbers gave the market a boost and the Oz quickly traded above 0.7450 before slumping back as the numbers to run higher again after the news traders were crushed and the market pushed to the 0.7470 levels. Topside offers now seem to be concentrated into the 0.7480-0.7500 areas however, strong buying into the level will run into further selling quiet quickly with 0.7520-40 likely to see strong offerings before the market open up and a possible rejection of the downside. Downside bids through the 74 cent level and into the 0.7380 areas with possible breakout stops appearing below those levels a push through 73 cents will likely see further stops opening up the downside range and the desired areas for the RBA, yesterday’s dip in Iron ore to below the $50 levels could continue to put the market under pressure however, with continuing good news in the employment area the pressure will begin to tell on any prospective rate cuts the RBA had planned.
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Overnight News                                                                                                                        Â
CNY:
China Security Agency to Investigate ‘Malicious’ Short Sales
China Stock Investors Need to Be Patient: Securities News
PBOC Offers China Securities Finance ‘Abundant’ Loans: Xinhua
China June Consumer Prices Rise 1.4% Y/y; Est. 1.3% Gain
CNY/IDR:
China Poses Bigger Threat than Greece to Indonesia, Kalla Says
AUD:
Australian Employment in June Rose 7,300 M/M; Est. No Change
JPY:
Japanese Bought Net 205.2 Billion Yen Overseas Debt Last Week
Abe: No Plan to Call Snap Election if Stalemate on Security Laws
Japan May Core Machine Orders Rise 0.6% M/m; est. -4.9%
JPY/CNY:
Aso: China Economy to Have Greater Effect on Japan Than Greece
GBP:
U.K. June RICS House Price Index at 40 vs Est. 36
NZD:
N.Z. June Retail Card Spending Rises on Fuel, Core Unchanged
Today’s data
Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT
GBPÂ Â Â Â Â Â RICS House Price Balance Jun A 40% | C 37% | P 34%
JPYÂ Â Â Â Â Â Â Â Machine Orders M/M May A 0.60% | C -4.60% | P 3.80%
JPYÂ Â Â Â Â Â Â Â Japan Money Stock M2+CD Y/Y Jun A 3.80% | C 4.00% | P 4.00% | R 4.10%
CNYÂ Â Â Â Â Â Â CPI Y/Y Jun A 1.40% | C 1.40% | P 1.20%
CNYÂ Â Â Â Â Â Â PPI Y/Y Jun A -4.80% | C -4.60% | P -4.60%
AUDÂ Â Â Â Â Â Employment Change Jun A 7.3K | C 0.1K | P 42.0K | R 40.0K
AUDÂ Â Â Â Â Â Unemployment Rate Jun A 6.00% | C 6.10% | P 6.00% | R 5.90%
06:00Â Â Â Â JPYÂ Â Â Â Â Â Â Â Machine Tool Orders Y/Y (JUN P) P 15.00%
06:00Â Â Â Â EURÂ Â Â Â Â Â Â German Trade Balance (EUR) May C 20.6B | P 22.3B
11:00Â Â Â Â GBPÂ Â Â Â Â Â BoE Rate Decision C 0.50% | P 0.50%
11:00Â Â Â Â GBPÂ Â Â Â Â Â BoE Asset Purchase Target C 375B | P 375B
12:15Â Â Â Â CADÂ Â Â Â Â Â Housing Starts Jun C 191K | P 201.7K
12:30Â Â Â Â CADÂ Â Â Â Â Â New Housing Price Index M/M May C 0.20% | P 0.10%
12:30Â Â Â USDÂ Â Â Â Â Â Initial Jobless Claims (JUL 4) C 277K | P 281K
Harry Hindsight                  Â
- EUR: Asia was reasonably quiet with the downside tested to just below the 1.0980 levels before again making its way to the opening 1.1015 areas into the grey hours, London initially had not direction but continual hopeful chatter from the European rumour mill leaves the market unsure but a little hopeful for a resolution for Greece, the market ticked higher with the equities doing better than the rest of the world and the market moved to the 1.1060 areas before stalling, the move into the NYK session saw the market dipping back to the opening levels before again starting a steady rise in limited volume to push towards the 1.1100 level and holding around the 1.1080 levels into the close in an uneventful day. FOMC minutes showed several officials warning of a premature rate rise however, this is likely to be out of date to some extent and any move will have to take in effect the Chinese financial crisis and Greek Saga once its resolved one way or the other.
- GBP: Opening around the 1.5460 levels the previous days production numbers have left the GBP drifting away from its strong highs against both the Euro and the USD with the market dipping in the Asian session to base on the 1.5430 levels in limited trading with grey your buyers appearing to push it back to the opening levels before early London sold it quickly to the 1.5400 levels, it struggled for awhile around the level before pushing lower just before the NYK session opened to trade to the 1.5360 levels, although the market continued to trade to the 1.5330 levels the market stalled for the most part and traded quietly into a close around the 1.5360 levels with no real data to go on.
- JPY: Cross/JPY selling continued through the day with the USDJPY coming under pressure from the opening around 122.40 level and dipping to the 122.00 into the grey hours, the market then ground through the bids over the course of the day pushing into mid-London to the 121.40 levels and then holding into the NYK session, then it pushed down to 121.20 and eventually broke below the 121.00 levels triggering light stops through to the 120.50 areas and bouncing off those levels for several hours into the close.
- AUD: Continuing cross/JPY selling and the financial market crisis in China left the Oz dropping quickly from the highs of 0.7460 to trade through the opening 0.7450 and quickly drop to below the 74 cent level with AUDJPY dropping from the 91.40 level for a big figure move in early trading, the Oz then held into the grey hours and early London broke the downside again and stops through the 74 cent level saw the market trading into the 0.7370 areas before finding sufficient support to start a steady rise back to the 0.7420 levels and continuing into the NYK session to the opening levels before finishing the day around the 0.7430 areas and off its lows.
Yesterday’s premiership results
Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT
GBPÂ Â Â Â Â Â BRC Shop Price Index Y/Y Jun A -1.30% | P -1.90%
JPYÂ Â Â Â Â Â Â Â Current Account (JPY) May A 1.64T | C 1.38T | P 1.27T
JPYÂ Â Â Â Â Â Â Â Eco Watchers Survey: Current Jun A 53.5 | C 53.2 | P 53.3
CADÂ Â Â Â Â Â Building Permits M/M May A -14.50% | C -5.20% | P 11.60% | R 12.10%
USDÂ Â Â Â Â Â Crude Oil Inventories A 0.4M | C -0.6M | P 2.4M
Good Luck,
Andy
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