Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 122.868 | EURUSD 1.07341 | AUDUSD 0.71948 | NZDUSD 0.65675 | USDCAD 1.32838 | USDCHF 1.01275 | GBPUSD 1.52919 |

 

Interbank Ranges as of 6am London time

Highs    Lows

USD/JPY               123.06 | 122.85

EUR/USD             1.07395 | 1.0710

EUR/JPY               131.93 | 131.68

AUD/USD            0.7211 | 0.7185

NZD/USD             0.6606 | 0.6552

USD/CAD             1.3307 | 1.3284

EUR/CHF              1.0875 | 1.0864

USD/CHF             1.0154 | 1.0125

GBP/USD             1.5298 | 1.5270

EUR/GBP             0.7020 | 0.7006

For Today

• EUR: A steady slip lower from the opening 1.0735 areas and the market tested to the 1.0710 levels before ranging through a quiet session holding that downside levels but never pushing to far above the 1.0725 levels. Light offers through the 1.0760 levels into the 1.0780 area before the market stiffens and the offers increase the closer the market moves to the 1.0800 levels, a push through the level could possibly see light stops however, selling is likely to reappear quickly through into the 1.0820 areas and getting stronger as the market pushes to the 1.0840 areas, the offers then are likely to continue in patches to the 1.0900 levels with stops likely in that area. Downside bids likely weak from the 1.0710 areas and into the 1.0680 areas, weak stop likely below the level before stronger bids make an appearance on a move to the 1.0650 area, with the possibility of weak stops below the 1.0640-30 areas and the 1.0600 level vulnerable.
• GBP: The market drifted lower from the opening 1.5290 opening areas and drifted into the low 1.5270 levels as the before steadily recovering with only patchy liquidity on the move back towards the highs just short of the 1.5300 level, from there the market has drifted back to hold around the 1.5290 levels in slow trading. Topside offers likely from the 1.5340 area with those offers quickly expending themselves through the 1.5360 area and then a concentration of potential offers from the 1.5390 areas and into the 1.5420 areas, even then the offers are likely to continue through the 1.5450 levels. Downside bids light into the 1.5250 areas however, the bids then start to increase as the market moves into the 1.5200 levels and several days of trading around the level, limited bids into the 1.5150 areas and the market needs to break the level to have any chance of moving lower, even so the 1.5100 provides a limited support areas and once through the level the 1.5050 area is likely to be key to further downside movement.
• JPY: USDJPY saw quiet trading through the session with the market lifting into the Tokyo session to test above the 123.00 levels however, it was a lacklustre move and the market soon dipped back towards the 122.85 areas where it opened, and then continued to move into the grey hours holding the levels. Topside offers weak again through the 123.20 areas before the market see’s stronger offers again building from the 123.60 levels onwards and the 124.00-20 areas the possible key area for a breakout, downside bids light through 122.50 areas before the market opens to better bids through 122.00 area and then continuing through the 121 handle however, it’s Friday little data and not even crackerjack at 5 to 5 so a slow day ahead one would guess.
• AUD: A quiet session for the Oz with little data and only limited news for the day, the market spent the early part of the day trading tightly around the 0.7190 levels before lifting above the 72 cent level and touching the 0.7210 areas before the market slipped slowly back to those opening levels again. Topside offers continue through the 0.7210 areas and although those offers are not likely to be too strong any move towards the 0.7240 areas is likely see stronger offers appearing through to the 0.7260 levels, with the offers likely to continue the strength could be a little weaker on a move to the 73 cent levels and a push through will likely to see stops triggered and the topside opens to a test to the 74 cents. Downside bids remain the same with nothing special through to the 0.7100 areas, a move through that area will likely see the strength of bids improving as the market probes below 0.7050 and then into the 70 cent level and then strong bids from then on.

Overnight News

Asia:

OECD Says Emerging Asia Growth to Moderate to 6.2% Over 2016-20

USD:

Fischer Says Fed Has Tried Not to Surprise EMs with Rate Hike

AUD:

RBA’s Heath Reiterates Growth ‘Not as Strong as We Would Like’

RBA’s Heath Says Labour Market Improving over Course of Yr

JPY:

BOJ to Release Its Own CPI Figures after Govt. Release

Aso: Will Make Necessary Policy While Considering Fiscal Reform

Japan Plans Wage Increase to Meet 600t Yen GDP Target: Kyodo

Japan’s Abe to Consider SDF Dispatch to South China Sea: Kyodo

CNY:

China Oct. Leading Economic Index Rises 0.6% M/m to 341.7

Today’s data

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

07:00     EUR        German PPI M/M Oct C -0.20% | P -0.40%

07:00     EUR        German PPI Y/Y Oct C -2.00% | P -2.10%

09:30     GBP       Public Sector Net Borrowing (GBP) Oct C 5.5B | P 8.6B

13:30     CAD       Retail Sales M/M Sep C 0.20% | P 0.50%

13:30     CAD       Retail Sales Less Autos M/M Sep C -0.20% | P 0.00%

13:30     CAD       CPI M/M Oct C 0.10% | P -0.20%

13:30     CAD       CPI Y/Y Oct C 1.00% | P 1.00%

13:30     CAD       BoC CPI Core M/M Oct C 0.20% | P 0.20%

13:30     CAD       BoC CPI Core Y/Y Oct C 2.00% | P 2.10%

15:00    EUR       Eurozone Consumer Confidence Nov (A) C -7 | P -7.7

Harry Hindsight              

• EUR: A steady rise through the Asian session saw the market move from the 1.0660 levels and pushing through the 1.0700 levels, light stops triggered to the 1.0720 area before the market held through top the London session in the 1.0690-00 level, the move into the grey hours saw light selling in the market and the Euro dipping back to just above the opening ranges, an increase in the Eurozone current account helped to raise the Euro again and push into the offers around the 1.0720 levels as with the first attempt the offers proved tough and the market drifted into NYK with fresh sellers making an appearance. While the US figures were on the face of it decent the market saw the USD again starting a sell off across the board and Euro’s pushed through the offers with weak stops triggered to the 1.0740 areas and continuing through light offers to the 1.0760 areas before running out of steam and drifting to the close.
• GBP: USD was in general retreat in early Asia and Cable managed to push from the 1.5230 levels and pushing through the 1.5260 levels to trigger minor stops and force the pair to 1.5290 before holding the 1.5270-90 levels into the London session, sellers from the opening in London managed to push the market a little lower and into the 1.5250 levels and even though the retail sales numbers were slightly worse than expected the market recovered and moved into the NYK session again seeing USD weakness and a test to the 1.5300 levels, a strong push on the second attempt saw weak stops triggered and a quick move to above the 1.5330 levels before drifting off and testing back through the 1.5300 level and into a quiet close.
• JPY: USD selling through the session saw the USDJPY fall back from the opening 123.60 levels, steadily drifting to the 123.40 areas before briefly holding the market, having struggled to make headway the market dropped quickly to the 123.10 levels and the better bids and the market held the 123.30 into the London session, quick selling again tested the lows on the opening in London and again the market held and only started to drift lower as the market approached the NYK session, as with the other pairs the USD made a weak attempt to rise before the market dropped to the 123.00 levels and pushed slowly lower and into the 122.60 levels before finding sufficient bids to hold the market and the slow rise to the close never getting back above the 122.90 levels.
• AUD: The Oz saw steady gains from the opening 71 cent levels and steadily rising to the 0.7160 levels before meeting light resistance and the market then holding in the 0.7160-70 areas for several hours to the London session, London were unable to break the topside extending the highs to the 0.7180 levels however, the market was still contained in a tight range as it ran to the NYK opening, NYK continued the movement selling the USD’s through the session and the Oz tested through the 0.7200 areas to post highs just above the 0.7210 level and then a slow move to the 0.7190 area closing.

Yesterday’s premiership results

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

NZD       PPI Inputs Q/Q Q3 A 1.60% | C 0.10% | P -0.30%

NZD       PPI Outputs Q/Q Q3 A 1.30% | C 0.20% | P -0.20%

JPY         Trade Balance (JPY) Oct A -0.20T | C -0.38T | P -0.36T

JPY         All Industry Activity Index M/M Sep A -0.20% | C 0.20% | P -0.20% | R -0.10%

CHF        Trade Balance (CHF) Oct A 4.16B | C 3.18B | P 3.05B | R 3.25B

EUR        Eurozone Current Account (EUR) Sep A 29.4B | C 18.3B | P 17.7B

GBP       Retail Sales M/M Oct A -0.60% | C -0.40% | P 1.90%

GBP       CBI Trends Total Orders Nov A -11 | P -18

EUR        ECB Monetary Policy Meeting Accounts

CAD       Wholesale Sales M/M Sep A -0.10% | C 0.20% | P -0.10%

USD       Initial Jobless Claims (NOV 14) A 271K | C 272K | P 276K

USD       Philly Fed Survey Nov A 1.9 | C 0 | P -4.5

USD       Leading Indicators Oct A 0.60% | C 0.50% | P -0.20%

 

Good Luck,

Andy

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