Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 112.434 | EURUSD 1.1338 | AUDUSD 0.76706 | NZDUSD 0.69098 | USDCAD 1.29656 | USDCHF 0.96502 | GBPUSD 1.4379 |

LMAX Highs and Lows 5am GMT

                                High | Low

EURUSD               1.13413 | 1.13105

USDJPY                 112.666 | 112.153

GBPUSD               1.43823 | 1.43275

AUDUSD              0.76723 | 0.76387

USDCHF               0.96626 | 0.96463

USDCAD               1.30017 | 1.29530

NZDUSD               0.69248 | 0.68910

EURGBP               0.78952 | 0.78808

EURJPY                 127.578 | 126.970

EURCHF                1.09381 | 1.09286

 

For Today

• EUR: After some initial steady buying from the opening around the 1.1335 levels the market moved deeper into the Tokyo session unable to push beyond the 1.1340 levels with any conviction and drifted down to the 1.1310 levels some strong EURJPY selling moving in from the 127.60 levels, the move into the grey hours saw the market holding just off the lows, Topside offers still remain and likely to continue through the 1.1360 levels with stronger offers around the 1.1400 areas, a push through the 1.1430 area is likely to see stops appearing and the market then opening to the 1.1480 levels with possibly only light offers making an appearance in the mid 1.1400. Downside bids are likely to be light through the 1.1300 areas and a break could quickly open a test lower to the 1.1200 levels with weak stops on a move through the 1.1270 levels and mild congestion to 1.1220. Eurozone CPI numbers and initial US jobless claims are likely to be of more import than anything else today.
• GBP: EURGBP cross continues to probe higher towards the 0.7900 level however, its been a reasonably quiet session for the Cable with the market holding the 1.4380 areas for the move through into Tokyo before the steady fall back of the Euro dragged on the Cable, the lesser liquidity of the pair saw the Cable dipping to the 1.4330 levels before the market found sufficient support and more the mechanics of the Euro bids than anything else, Topside offers again into the 1.4450 levels with a push through the level likely to see profit taking into the 1.4500 areas and possibly short term sellers appearing with congestion through the level, however, 1.4600 now seems to be the key level on any movement to the end of last year’s ranges so likely strong offers, Downside bids are likely to remain weak through to the lows from last month with the continuation of Brexit chatter likely to dominate the market, as each side uses shock and horror to persuade the electorate they are right, 1.4300 is likely to be the central level with the likelihood of a total mix of bids and stops appearing around the area and the market becoming weaker the further it penetrates that area, for the day though the market will possibly find further weakness if the EURGBP moves significantly so take the lead from the Euro with UK GDP not likely to change for the moment.
• JPY: USDJPY opened quietly and drifted through the opening of the Tokyo session to test to the 112.25 levels before offshore banks appeared to take the market higher again in the face of the Japanese sellers, with the market testing quickly above the 112.65 areas before again drifting back to the lows to define the range. Topside offers light through to the 112.80 areas before better offers are likely to be seen on any renewed attempt to the 113.50 highs, possibly significantly stronger offers from there are likely on any attempt through the 114.00 levels that have held for the most part over the past month. Downside bids into the 112.20-111.80 levels are likely to be less impressive than previous moves through the level and the better bids move in around the 111.50 levels with move through that level meeting more and more support into the sub 111.00 area.
• AUD: The Oz has drifted through the session with the range being comparable to the major pairings and from the 0.7670 level tested back to 0.7640 late into Tokyo, the market is running into the grey hours just above the 0.7650 levels. Downside bids are likely to be reasonable into the 0.7600 levels and for the moment looking comfortable given the lack of direction from the RBA over the past weeks however, chatter in the media about the possibility of a downgrade to Australia’s credit rating could see that downside severely tested and a strong run lower with the support around the 75 cent level melting quickly away and exposing a far larger move, Topside offers remain into the 0.7700 levels with option barriers possibly still remaining in play and congestion from there too the 78 cent level.

 

Overnight News

JPY:

BoJ’s Kuroda: No limits or obstacles to BoJ’s monetary policy

AUD:

Australia’s job vacancies jump to highest since 2012 with a rise to 172,800 seasonally adjusted

CNY:

China bank chiefs warn of tough times as profit growth stalls

Today’s data

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

GBP       GfK Consumer Sentiment Mar A 0 | C -1 | P 0

NZD       NBNZ Business Confidence Mar A 3.2 | P 7.1

JPY         Housing Starts Y/Y Feb A 7.80% | C -2.20% | P 0.20%

07:55     EUR        German Unemployment Change Mar C -5K | P -10k

07:55     EUR        German Unemployment Rate Mar C 6.20% | P 6.20%

08:30     GBP       Mortgage Approvals Feb C 74K | P 74.6k

08:30     GBP       M4 Money Supply M/M Feb C 0.10% | P 0.00%

08:30     GBP       GDP Q/Q Q4 (F) C 0.50% | P 0.50%

08:30     GBP       Current Account (GBP) Q4 C -21.8B | P -17.5B

08:30     GBP       Index of Services 3M/3M Jan C 0.80% | P 0.70%

09:00     EUR        Eurozone CPI Estimate Y/Y Mar C -0.10% | P -0.20%

09:00     EUR        Eurozone CPI – Core Y/Y Mar (A) C 0.90% | P 0.80%

11:30     USD       Challenger Job Cuts Y/Y Mar P 21.80%

12:30     CAD       GDP M/M Jan P 0.20%

12:30     CAD       GDP Y/Y Jan P 0.50%

12:30     USD       Initial Jobless Claims (MAR 26) C 269K | P 265K

13:45     USD       Chicago PMI Mar C 50.6 | P 47.6

Harry Hindsight              

• EUR: A quiet start to the day with the Euro opening around the 1.1290 areas and making the early lower for the day to test into the low 1.1280’s, the market continued to drift through the Tokyo session briefly testing the 1.1300 levels but generally holding in that range until the grey hours were early London push the market through the 1.1300 level, Eurozone mixed confidence numbers helped the market a little and the Euro extended its gains to the 1.1330 areas with light stops being triggered on the move but unable to push through too far, The move through to the NYK session saw the highs extended but again it was more of a steady grind than anything else and the market moved quietly with the NYK market not overly committed to the moves the push back to the highs for another run saw strong stops appearing and the market testing up into the 1.1365 areas and the highs made before dropping back to trade quietly into the close and holding in the 1.1330.
• GBP: Cable was lacklustre through the Asian session with and traded in a tight range through into the grey hours, strong EURGBP selling helped take the Cable through the 1.4400 levels and a steady push higher to test the 1.4450 in early trading however, once the rally was over both the USD and Euro’s started to make inroads on the initial GBP gains with the EURGBP rising from the 0.7835 lows and Cable dropping back to the Asian ranges around the 1.4380-90 areas to the move into the NYK session, and a last attempt at the 1.4450 levels for the market, pushing lightly through and running into strong resistance before dropping back quickly as the rally failed to make the lows for the day around the 1.4360 levels and a quiet close to leave the market almost unchanged.
• JPY: USDJPY spent much of the day drifting steadily lower from the opening around the 112.70 with the market continuing to react to the Yellen speech and the debate of repealing the negative rates left behind, initial selling into the Tokyo session saw the market drop back to the 112.40 levels and then holding into the London session, negative USD reactions and the UDSJPY pressed to the 112.00 levels before the JPY sellers started to truly appear and a steady rise towards the opening levels ensued, the move into the NYK session was mute and the range reasonably tight through the period to the close with the market only 30 pips away from its opening.
• AUD: Oz opened around the 0.7630 levels and initial attempts to push through the 0.7650 levels were rejected into the Tokyo session which sent the Oz into a steady drift through the session and into the grey hours testing through 0.7620, London were steady buyers and the market accelerated from the official opening and the 0.7650 level was quickly broken triggering weak stops on a stab at the 77 cent level failing the move and drifting back to hold around the 0.7660 areas, however, liquidity to the topside had been damaged enough sufficiently that when the NYK session moved in and the data had been released the commodity currencies found a second wind and the Oz again tested the level to the topside and pushed to the 0.7710 levels before the market ran out of steam, the market then saw the pair quickly lower and a steady rise into the close.

Yesterday’s premiership results

NZD       Building Permits M/M Feb A 10.80% | P -8.20% | R -7.80%

JPY         Industrial Production M/M Feb (P) A -6.20% | C -5.80% | P 3.70%

CHF        UBS Consumption Indicator Feb A 1.53 | P 1.66 | R 1.45

CHF        KOF Leading Indicator Mar A 102.5 | C 102.1 | P 102.4 | R 102.6

EUR        Eurozone Business Climate Indicator Mar A 0.11 | C 0.08 | P 0.07 | R 0.09

EUR        Eurozone Economic Confidence Mar A 103 | C 103.8 | P 103.8 | R 103.9

EUR        Eurozone Industrial Confidence Mar A -4.2 | C -4.1 | P -4.4 | R -4.1

EUR        Eurozone Services Confidence Mar A 9.6 | C 10.5 | P 10.6 | R 10.8

EUR        Eurozone Consumer Confidence Mar (F) A -9.7 | C -9.7 | P -9.7

EUR        German CPI M/M Mar (P) A 0.80% | C 0.60% | P 0.40%

EUR        German CPI Y/Y Mar (P) A 0.30% | C 0.20% | P 0.00%

USD       ADP Employment Change Mar A 200K | C 194K | P 214K | P 205K

USD       Crude Oil Inventories A 2.3M | C 3.1M | P 9.4M

Good Luck,

Andy

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