Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 102.431 | EURUSD 1.12503 | AUDUSD 0.74677 | NZDUSD 0.72816 | USDCAD 1.31965 | USDCHF 0.97335 | GBPUSD 1.32368 |

LMAX Highs and Lows 5am GMT

                                High | Low

EURUSD               1.12520 | 1.12404

USDJPY                 102.613 | 101.990

GBPUSD               1.32800 | 1.32330

AUDUSD              0.74855 | 0.74471

USDCHF               0.97392 | 0.97255

USDCAD               1.32140 | 1.31924

NZDUSD               0.73028 | 0.72585

EURGBP               0.84991 | 0.84671

EURJPY                 115.400 | 114.647

EURCHF                1.09492 | 1.09414

 

For Today

• EUR: A very quiet session for the Euro with the market drifting a little from the opening levels to test the 1.1240 areas and basing along that area through to the London opening, Eurozone trade balance and the CPI numbers of import today with a set of US numbers later in the day with could define the next FED move to come, Topside offers through the 1.1280 areas will likely see sharp buying on a strong move to discount the congestion to the 1.1350 levels and then some stronger offers likely to appear from there onwards, Downside bids light through to the 1.1150 areas with the congregation around the 1.1200 limited on a sharp move as with the topside, a move through the level though will likely see stops appearing on a move below the 1.1140 areas if it can push that far and the congestive area vulnerable to those stops.
• GBP: Cable saw limited buying into the Tokyo opening and pushed off the 1.3235 area opening to test higher through to the 1.3280 levels before slowly sliding lower through the session to hold just below the 1.3250 levels into the London session. Topside offers weak through the 1.3300 areas with possibly stronger offers moving in around the 1.3350 areas but I’d not really hold my breath for them holding on a strong move, the MPC meeting today is likely to be a drab affair and we will have to wait for the commentary that could intimate better ideas for the future, a push through the 1.3350 areas will likely see stronger offers appearing only on a move through the 1.3400 levels and into the 1.3450, downside bids through the 1.3200 levels very light and the market has congestive bids through the 1.3150 levels however, from 1.3100 through to the 1.3050 areas is likely to see stronger bids appearing and the market is not likely to see any major stops until a good way through the level.
• JPY: Early buying into the Tokyo session saw the highs around the 102.60 areas before solid selling moved into the market with concerns over central banks running out of ideas in the US and Japan the commentary in the media and financial guru’s saw the USDJPY push back to the 102.00 levels into mid-session before a steady rise back towards the opening levels, Topside offers through the 103.00 levels with little in the market until around the 103.50 areas and then congestion to the 104.00 areas with stops likely to be positioned beyond that point, downside bids light through to the 101.00 levels and then stronger bids appearing on any dip below the level and through to the 100.00 areas.
• AUD: Another quiet session for the Oz with t4he market rising in early trading from the opening 0.7470 levels to make highs just beyond the 0.7485 levels however, the fresh AUDJPY longs started to take fright as the USDJPY started to push lower and the movement in the cross saw the Oz dragged lower to test back to the 0.7450 level and set the range for the session, the market did recover and moves into the London session little changed on the day, topside offers around the 0.7480-0.7500 levels with likely weak stops appearing on a move through the level and the market then open to test higher with weaker offers than previously, downside bids into the 0.7450-40 areas will likely see weak stops appearing and the market vulnerable to those stops and congestive bids into the 0.7350 becoming vulnerable on any strong moves especially with the US numbers.

Overnight News

AUD:

Australian Aug. Employment Falls 3,900 M/M; Est. 15,000 Gain

JPY:

Japanese Sell Most Foreign Bonds Since April as Home Yields Jump

BOJ Board to Discuss Defining Conditions for Easing Exit: Nikkei

Abe Aide Expects BOJ to Return to Starting Point of Abenomics

NZD:

New Zealand Economy Expands 0.9% on Construction Boom

SGD:

Singapore July Retail Sales +2.8% Y/y; Est. +1.4%

HKD:

HKMA Asks Hong Kong Banks for Mortgage Data Since Aug.: HKEJ

Today’s data

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

NZD       Business NZ Manufacturing Index Aug A 55.1 | P 55.8 | R 55.5

NZD       GDP Q/Q Q2 A 0.90% | C 1.10% | P 0.70% | R 0.90%

AUD       Consumer Inflation Expectation Sep A 3.30% | P 3.50%

AUD       Employment Change Aug A -3.9K | C 15.2K | P 26.2k

AUD       Unemployment Rate Aug A 5.60% | C 5.70% | P 5.70%

07:30     CHF        SNB Libor Rate C -0.75% | P -0.75%

08:30     GBP       Retail Sales M/M Aug C -0.40% | P 1.40%

09:00     EUR        Eurozone Trade Balance (EUR) Jul C 22.1B | P 23.4B

09:00     EUR        Eurozone CPI M/M Aug C 0.10% | P -0.60%

09:00     EUR        Eurozone CPI Y/Y Aug (F) C 0.20% | P 0.20%

09:00     EUR        Eurozone CPI – Core Y/Y Aug (F) C 0.80% | P 0.80%

11:00     GBP       BoE Rate Decision C 0.25% | P 0.25%

11:00     GBP       BOE Asset Purchase Target Sep C 435B | P 435B

11:00     GBP       MPC Official Bank Rate Votes C 0–0—9 | P 0–0–9

11:00     GBP       MPC Asset Purchase Facility Votes C 0–0—9 | P 0–0–9

12:30     USD       Initial Jobless Claims (SEP 10) C 262K | P 259K

12:30     USD       Advance Retail Sales Aug C 0.20% | P 0.00%

12:30     USD       Retail Sales Less Autos Aug C 0.30% | P -0.30%

12:30     USD       PPI M/M Aug C 0.00% | P -0.40%

12:30     USD       PPI Y/Y Aug P -0.20%

12:30     USD       PPI Core M/M Aug C 0.20% | P -0.30%

12:30     USD       PPI Core Y/Y Aug P 0.70%

12:30     USD       Current Account Balance Q2 C -120B | P -125B

12:30     USD       Empire State Manufacturing Index Sep C -0.9 | P -4.2

12:30     USD       Philly Fed Manufacturing Index Sep C 1.1 | P 2

13:15     USD       Industrial Production Aug C -0.20% | P 0.70%

13:15     USD       Capacity Utilization Aug C 75.70% | P 75.90%

14:00     USD       Business Inventories Jul C 0.10% | P 0.20%

Harry Hindsight              

• EUR: A quiet early part to the day with the market opening around the 1.1215 levels and moving into the Asian session rising slightly through the course of the day to push into the London session holding the 1.1225 areas, so a big 10 pip rise, early London pushed quickly to the 1.1240 areas but was unable to push much beyond the level and slowly gravitated to the opening areas to trade quietly through to the NYK session with USD selling moving in through the session the market in Euro’s showed steady gains to push through to the 1.1270 levels before running out of steam and slipping back at the back end of the session to trade around the 1.1250 levels.
• GBP: After early selling into the Tokyo session the market pushed off the 1.3170 levels and back through the 1.3190 opening levels to test into the London session pushing through the 1.3200 levels and holding around the level through into the NYK session in quiet trading, USD rally took the Cable to the lows around 1.3140 however, with the BoE unlikely to cut again the market started a steady rise through the balance of the day pushing back through the 1.3220 levels and holding the close around the 1.3240 area. With the state address by Junker or state disarray one could say, the market was limited and only the US session reacted to his comments in anyway, it is interesting to note that Das Spiegal had more to say on ongoing concerns that seem to have bypassed Mr Junker along the way and whether he likes it or not Europe needs the UK more than the UK needs Europe.
• JPY: Early gains for the USDJPY ran into offers and was unable to push through 103.00 levels testing initially to the 103.20 areas before trading around the 103.00 levels through to the London session, London quickly bought to the 103.30 levels before weak selling saw the market back to the opening 102.60 areas and holding quietly through to the NYK session, while the rest of the market was selling the USD through NYK the USDJPY was a little more resilient through to the close and based along the 102.30 levels through to the close just above those levels.
• AUD: The Oz moved off the opening 0.7460 areas and then traded in a narrow range throughout the day with early AUDJPY buying taking the market towards the highs and the market holding around the 0.7480 deep into the London session, any weakness in the USD though was balanced by the crosses and the Oz dipped to the 0.7450 levels into the NYK session but recovered once the cross selling abated and held around the 0.7470 levels pushing occasionally towards the highs but with little strength.

Yesterday’s premiership results

NZD       Current Account Balance Q2 A -0.95B | C -0.30B | P 1.31B | R 1.18B

AUD       Westpac Consumer Confidence Sep A 0.30% | P 2.00%

JPY         Industrial Production M/M Jul (F) A -0.40% | C 0.00% | P 0.00%

GBP       Jobless Claims Change Aug A 2.4K | C 1.7K | P -8.6K | R -3.6K

GBP       Claimant Count Rate Aug A 2.20% | P 2.20%

GBP       Average Weekly Earnings 3M/Y Jul A 2.30% | C 2.10% | P 2.40% | R 2.50%

GBP       ILO Unemployment Rate 3M Jul A 4.90% | C 4.90% | P 4.90%

EUR        Eurozone Industrial Production M/M Jul A -1.10% | C -0.80% | P 0.60% | R 0.80%

CHF        ZEW (Expectations) Sep A 2.7 | P -2.8

USD       Import Price Index M/M Aug A -0.20% | C -0.40% | P 0.10%

USD       Crude Oil Inventories A -0.6M | C 2.8M | P -14.5M

Good Luck,

Andy

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