Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close Wellington open

USDJPY 111.777 1.1150-75 | EURUSD 1.12248 1.1220-495 | AUDUSD 0.77116 0.7701-15 | NZDUSD 0.68518 0.6836-76 | USDCAD 1.2669 1.2667-86 | USDCHF 0.97857 0.97445-98 | GBPUSD 1.44021 1.4401-26 |

 

LMAX Ranges 6am London time

Highs    Lows

EURUSD               1.12471 | 1.12182

USDJPY                 111.886 | 111.039

GBPUSD               1.44713 | 1.44250

USDCHF               0.97877 | 0.97663

AUDUSD              0.77116 | 0.76911
USDCAD               1.26940 | 1.26500

NZDUSD               0.68660 | 0.68436

EURCHF                1.09918 | 1.09810

EURGBP               0.77932 | 0.77535

EURJPY                 125.499 | 124.842

For today

• EUR: Opening a little lower the market slowly picked its way through a none existent Sydney session with both Oz and NZ out for the day for ANZAC day, the Euro slowly moved off the 1.1220 levels and traded quietly through to the 1.1245 areas before holding the level for the move into the grey hours, Topside offers are likely to be light through the 1.1280 areas and while the market is likely to struggle for a short period on any move higher the 1.1320 has been well traversed over the past week and the market is likely to open to a test towards the 1.1400 levels and better offers. Downside bids into the current 1.1220 lows and through to the 1.1180 areas before the chance of weak stops appear and the market opens for a limited period into the 1.1150 areas, and those bids likely to see further opening to the 1.1100 areas.
• GBP: Initial pre market opening saw the market in line with the close on Friday however, early longer term buyers moved in and by the time the official market opened the market was trading towards the 1.4470 levels before spending the rest of the session slipping slowly back in an attempt to fill the gap, the market then based on the 1.4430 levels for a long period into the grey hours, Topside offers through the 1.4480 levels and likely into the 1.4500 area and possibly through the level and into the 1.4550 areas , a push through this level will likely see some light stops and then further offerings. Downside bids into the 1.4400 levels are likely to be light with better bids possibly not seen until the 1.4300 levels however, if the market is moving that quickly they will likely to be token bids and the market has the potential to move onto the 1.42 handle.
• JPY: Opening a little higher the market drifted off from the 111.80 levels as the bank holidays in Oz and NZ weighed on the market a little and the USDJPY headed towards the 111.00 level through the course of the session, for the moment the market looks to be moving into the grey hour around the 111.20 levels with the downside likely to be weak and support unformed unto the mid 110 levels, a push through here will see bids in the 110.20 levels and while a little stronger still leaves something to be desired.
• AUD: With a bank holiday in both Australia and New Zealand the market has been lacking the usual movements from the local market and has ranged around the 77 cent levels in a tight range. Topside offers into the 0.7740-60 levels are likely to be very light and the test of the 0.7780 areas is likely to see stronger offers appear with those offers likely to continue through the level as short term trades look to fade any move towards the 0.7840 areas. Downside bids light through the 0.7680 areas with some bids likely on a test into the 0.7640-50 areas and then lighter towards 76 cents.

Overnight News                                                                  

JPY:

BOJ Officials Are Said to Want Government to Do More for Growth

Abe’s Party Wins Tight By-Election in Test for Japan Summer Vote

CNY:

China May Introduce New Regulator in Securities Law Review: 21^st

SGD:

Singapore March Consumer Prices -1% Y/y; Est. -1%

Today’s data

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

JPY         Corporate Service Price Y/Y Mar A 0.20% | C 0.20% | P 0.20%

08:00     EUR        German IFO – Business Climate Apr C 107.1 | P 106.7

08:00     EUR        German IFO – Current Assessment Apr C 113.8 | P 113.8

08:00     EUR        German IFO – Expectations Apr C 100.9 | P 100

10:00     GBP       CBI Trends Total Orders Apr C -17 | P -14

14:00     USD       New Home Sales Mar C 521K | P 512k

Weekend News

JPY:

Abe Says Japan to Compile Extra Budget for Kumamoto Quake
BOJ to Mull Financial Aid to Banks in Quake-Hit Area: Yomiuri
EUR:

Sovereign-Debt Debate Divides EU as Schaeuble Pushes for Limits
Germany Resists IMF Push to Cap Interest for Greece: Spiegel
Most EU Nations Against Sovereign-Debt Limits, Padoan Says
Greek Support for Euro Drops in Public Issue Survey For Avgi
Dutch Minister Dijsselbloem Says Greek Liquidity Is Short
CNY:

PBOC’s Chen Sees More Factors Affecting Stability: China News
AUD/CNY:

Australian Government Imposes Dumping Duties on Chinese Steel
USD:

U.S. Regulators to Propose New Liquidity Demand for Big Banks
U.S. Won’t Stand in Way of Allowed Business With Iran: Kerry
Sanders Says Losses to Clinton Show `Poor People Don’t Vote’
JPY/USD/KRW:

Japan, U.S., S. Korea May Seek Oil-Export Ban TO N. Korea: Asahi
AUD:

Turnbull Bets on Property Votes, Decries `Sledgehammer’ Tax Plan
TRY:

IMF Says Tighter Fiscal and Monetary Policy Advised for Turkey
RUB:

Russia Affirmed by Moody’s, Outlook Negative

Harry Hindsight

• EUR: Opening around the 1.1290 levels the move through into the Tokyo session eventually saw the market pushing higher and through the 1.1300 levels before holding the level through into the London session, mixed PMI numbers saw the Eurozone again under performing and the market saw a steady drift lower over the course of the day, the move into NYK saw very little difference to the general mood and the market eventually based off the 1.1220 levels into the close.
• GBP: Asia opened quietly and the Cable moved from the 1.4320 levels and started to rise to test around the 1.4350 levels, the talk of Brexit from early in the London session initially saw the Cable returning to the opening levels however, once that initial talk was over with the market again started to move back through the highs and the break of the 1.4360 levels saw weak stops triggered to the 1.4400 level, and the move into the NYK session saw the market again testing to the 1.4440-50 levels in a quick move before failing and slipping back to trade around the 1.4400 levels to the close.
• JPY: USDJPY struggled through the Asian session with the market trading in a very tight range around the 109.40 areas, the move towards London saw the level break and weak stops triggered with the market pushing through into the London session to test through 110.00 levels and light offers, the market stalled into the 110.50-60 areas running out of steam before the NYK session moved in, with increasing belief in further stimulus to come this week the NYK session again saw USDJPY rallying in a steady climb through the day and testing the 111.80 levels and while the range was large the move through the day was steady.
• AUD: The Oz ranged through the day lifting from the 0.7740 areas to test the 0.7770 levels in slow trading for the pair, however, having initially lifted to the highs each return higher was limited and the market slowly edged lower to hold the 0.7740-50 areas for much of the London session, the move into the NYK session saw end of day London selling move in as day traders started to cut there longs and profit taking in AUDJPY cross, the market dipped to the 77 cent levels and drifted into the 0.7690 however, with ANZAC day on the 25^th much of the Oz traders had wrapped up for the day and the market couldn’t move to far from the 77 cent levels.

Friday’s premiership results

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%

EUR        Germany Manufacturing PMI Apr (P) A 51.9 | C 51 | P 50.7

EUR        Germany Services PMI Apr (P) A 54.6 | C 55.2 | P 55.1

EUR        Eurozone Manufacturing PMI Apr (P) A 51.5 | C 51.8 | P 51.6

EUR        Eurozone Services PMI Apr (P) A 53.2 | C 53.3 | P 53.1

CAD       Retail Sales M/M Feb A 0.40% | C -0.80% | P 2.10% | R 2.00%

CAD       Retail Sales Less Autos M/M Feb A 0.20% | C -0.80% | P 1.20% | R 1.30%

CAD       CPI M/M Mar A 0.60% | C 0.30% | P 0.20%

CAD       CPI Y/Y Mar A 1.30% | C 1.20% | P 1.40%

CAD       BoC CPI Core M/M Mar A 0.70% | C 0.40% | P 0.50%

CAD       BoC CPI Core Y/Y Mar A 2.10% | C 1.70% | P 1.90%

Stay lucky

Andy

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