Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 109.463 | EURUSD 1.1287 | AUDUSD 0.77378 | NZDUSD 0.69093 | USDCAD 1.27345 | USDCHF 0.97515 | GBPUSD 1.43226 |

LMAX Highs and Lows 5am GMT

                                High | Low

EURUSD               1.13088 | 1.12822

USDJPY                 110.193 | 109.263

GBPUSD               1.43559 | 1.43033

AUDUSD              0.77741 | 0.77357

USDCHF               0.97562 | 0.97326

USDCAD               1.27366 | 1.26865

NZDUSD               0.69355 | 0.69073

EURGBP               0.78844 | 0.78701

EURJPY                 124.417 | 123.416

EURCHF                1.10099 | 1.00001

 

For Today

• EUR: Light trading through into the Tokyo session with the Euro’s rising from just below the 1.1290 levels and pushing quietly to the 1.1310 levels before holding around the figure area for the move into the grey hour before London, Topside offers light now through to the 1.1400 levels and stronger offers likely to be connected to option barriers into the level, a move through the level is likely to continue to see selling appear and the market into the 1.1440-60 areas likely to cause the market to pause on any strong move, PMI of note for the day with little for the NYK session, Downside bids likely to be light through to the 1.1280 areas and then stronger into the 1.1240-60 areas before the market opens for a test through the 1.1200 areas and possible weak stops.
• GBP: Cable moved steadily higher from the opening pushing from the 1.4320 level and into the 1.4350 area before stalling and ranging around the level into the London session, Topside offers weaker through the 1.4400 levels before better offers start appearing around the 1.4450 areas a breakthrough of the area is likely to see further offers into the 1.4500 levels and the highs from last month under pressure, with the market opening for a test of the 1.4600 levels a potential. Downside bids light into the 1.4300 levels however, the market held yesterday and likely weak stops on a move through the areas opening up a deeper move through the 1.4200 levels.
• JPY: USDJPY ranged through the session between the 109.25-50 level and seemed reluctant to move in either direction, postal pension will move into more riskier assets in an attempt to boost profitability as negative interest rates shrink its income, did little to the market overall with the numbers doing very little, a change to the BoJ lending facility and talk of the BoJ lending to Banks at a negative rate saw the USDJPY rise quickly to the 110.20 and then hold above the 110.00 area. Topside offers into the 110.20 areas still holding any rally higher with a move through the level likely to see weak stops and the market opening to the 110.80-111.00 areas, downside bids light through the 109.00 with better bids just below and the market likely to be slowed to the 108.60 levels before the potential to test the 108.20-00 areas, and a break here likely to see stronger bids making an appearance into that double bottom around the 107.60 areas protecting a bigger drop.
• AUD: The Oz spent the early part of the session moving off yesterday’s lows around the 0.7735 area and pushing steadily towards the 0.7775 areas as talk of strong 1.1200 AUDNZD option expiries for the day made the rounds and the market remained around the level in the cross. The Oz drifted back to the 0.7750 levels into the latter part of the session and holds around the level as we head towards the London session, Topside offers light through to the 0.7820 areas and stronger offers are likely to materialize into the 0.7840-60 levels further offers into the 79 cent level are likely to be a little weaker and the target is likely to be the 80 cent levels, downside bids increase as the market moves again to the 0.7730 areas and likely to cause some support through the day, a push through to the 77 cent level though is likely to see weak stops appearing and the market likely to see better bids on any move through to the 0.7650 area.

Overnight News

JPY:

BOJ Officials Said to Eye Possible Negative Rate on Loan Program

Japan Post to Fight Negative Rates by Shifting to Riskier Assets

Nikkei Japan April Flash Manufacturing PMI 48 vs 49.1 in March

CNY:

China 1Q Data Suggests Downturn Avoided, Researcher Says: Daily

NZD:

English Says RBNZ Board Letter Not Driven by Performance Concern

HKD:

H.K.’s April Primary Home Transactions Highest in 5 Mos.: HKET

Today’s data

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

JPY         Manufacturing PMI Apr (P) A 48 | C 49.6 | P 49.1

JPY         Tertiary Industry Index M/M Feb A -0.10% | C -0.40% | P 1.50%

07:30     EUR        Germany Manufacturing PMI Apr (P) C 51 | P 50.7

07:30     EUR        Germany Services PMI Apr (P) P 55.1

08:00     EUR        Eurozone Manufacturing PMI Apr (P) C 51.8 | P 51.6

08:00     EUR        Eurozone Services PMI Apr (P) C 53.3 | P 53.1

12:30     CAD       Retail Sales M/M Feb C -0.80% | P 2.10%

12:30     CAD       Retail Sales Less Autos M/M Feb C -0.80% | P 1.20%

12:30     CAD       CPI M/M Mar C 0.30% | P 0.20%

12:30     CAD       CPI Y/Y Mar P 1.40%

12:30     CAD       BoC CPI Core M/M Mar C 0.40% | P 0.50%

12:30     CAD       BoC CPI Core Y/Y Mar P 1.90%

Harry Hindsight              

• EUR: A very quiet session through Asia and deep into London with the market trading around the 1.1290-1.1300 levels for much of the day until the move towards the ECB decision which as expected was unchanged and the market rallied quickly to the 1.1400 areas, Draghi comments afterwards again reiterated the downside risks and the market dropped back even quicker triggering weak stops taking the market through the day’s lows and pushing to the 1.1270 levels before steadying and returning to the original range around the 1.1290 areas.
• GBP: Cable initially had more movement over the course of Asia and into London with the market opening around the 1.4335 areas and trading to the 1.4320 into Tokyo, the rise through the session was steady and tested into the London session pushing above the 1.4350 areas, the release of poor retail sales saw Cable drop back to the 1.4300 levels and losing ground to a rising Euro with the Cross EURGBP moving to the 0.7890 levels and eventually dragging Cable off its lows in the move, the test through the 1.4370 level saw weak stops taking the market through the 1.4400 levels and the Euro’s rise to 1.1400 pulling at the Cable until the market touched the 1.4440 levels and Euro’s reversal triggering a USD buy and Cable back to the 1.4330 levels and a slow quiet range to the close.
• JPY: USDJPY had a limited but choppy day with the events in Europe having little impact on the day, opening around the 109.80 areas and unable to push through the topside offers into the 110.00 levels and starting a steady drift into the 109.60 levels and then ranging through into the London session between those levels, early London sold to the 109.50 but the movement was lacklustre and soon returned to the previous range, deep into the NYK session the release of weaker leading indicators saw the USD dip against the JPY and the market push towards the 109.30 levels and a quiet range through to the close.
• AUD: A quiet rise through the Asian session with the market opening around the 0.7795 areas and steadily pushing to the 0.7835 areas into the NYK session with London very quiet on the pair, cross AUD buying saw the Oz being pressured lower through the Euro numbers and then USD numbers with the Oz dropping quickly to the 0.7760 areas before the ascent slowed, however, it did continue eventually pushing into the 0.7735 areas and holding quietly through to the close on those lows.

Yesterday’s premiership results

AUD       NAB Business Confidence Q1 A 4 | P 4 | R 5

CHF        Trade Balance (CHF) Mar A 2.16B | C 3.89B | P 4.07B | R 4.02B

GBP       Retail Sales M/M Mar A -1.30% | C -0.10% | P -0.40%

GBP       Public Sector Net Borrowing (GBP) Mar A 4.2B | C 5.6B | P 6.5B

EUR        European Central Bank Rate Decision A 0.00% | C 0.00% | P 0.00%

EUR        ECB Press Conference

USD       Initial Jobless Claims (APR 16) A 247K | C 265K | P 253K

USD       Philly Fed Manufacturing Index Apr A -1.6 | C 8.1 | P 12.4

USD       House Price Index M/M Feb A 0.40% | C 0.40% | P 0.50%

EUR        Eurozone Consumer Confidence Apr (A) A -9 | C -9 | P -9.7

USD       Leading Indicators Mar A 0.20% | C 0.40% | P 0.10%

Good Luck,

Andy

Any opinions, news, research, analyses, prices or other information contained on this Blog, whether by LMAX, its employees, partners or contributors, does not constitute investment advice nor has it been prepared in accordance with legal requirements designed to promote the independence of investment research. Further, the material contained within this Blog does not contain (and should not be construed as containing) investment advice or an investment recommendation, or an offer of, or solicitation for, a transaction in any financial instrument. Whilst information provided on this Blog may help with your investment research you must consider carefully whether you should make (or refrain from making) investment or other decisions based on what you see without doing further research on the investments you are interested in. Participating in this Blog cannot be a substitute for obtaining advice from an appropriate expert independent adviser who takes into account your circumstances and specific investment needs in selected investments that are appropriate for you. LMAX has not verified the accuracy or basis-in-fact of any claim or statement made by any third parties as comments for every Blog entry.

LMAX will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. No representation or warranty is given as to the accuracy or completeness of the above information. While the material produced in this Blog was obtained from sources deemed to be reliable, LMAX does not provide any guarantees about the reliability of such sources.

Consequently any person acting on it does so entirely at his or her own risk.

If you currently hold an account with LMAX for the purposes of trading FX and CFD’s, you are encouraged to use a different Username and Password to access the Blog or any other online systems. The Blog is a place to learn, discuss and share information and ideas with Blog followers. It is not a place to slander, use unacceptable language or to promote LMAX or any other FX, Spread Betting and CFD provider and any such postings, excessive or unjust comments and attacks will not be allowed and will be removed from the site immediately.