Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 103.835 | EURUSD 1.08838 | AUDUSD 0.76067 | NZDUSD 0.71621 | USDCAD 1.33577 | USDCHF 0.99353 | GBPUSD 1.22295 |

 

LMAX Ranges 6am London time

Highs    Lows

EURUSD               1.08845 | 1.08594

USDJPY                 104.001 | 103.818

GBPUSD               1.22311 | 1.21859

USDCHF               0.99561 | 0.99377

AUDUSD              0.76180 | 0.75922

USDCAD               1.33600 | 1.33244

NZDUSD               0.71714 | 0.71443

EURCHF                1.08226 | 1.08062

EURGBP               0.89135 | 0.88965

EURJPY                 113.156 | 112.846

For today

• EUR: Another quiet session with the market opening around the 1.0880 levels moving through into the Tokyo and then dipping to the 1.0860 levels again to test the resolve of the market and held around the 1.0870 levels to the London session with very little volume moving through the market, downside bids into the 1.0860 levels dating back to earlier in the year seem to be the key level for the moment with bids likely to continue to the 1.0840 areas before possible weakness appears and a move through to the 1.0800 level possibly limited and more sentimental than anything, with a push through the level opening a deeper move and technically looking weak to the 1.05-1.06 levels. Topside offers likely to be light on a move through the 1.09 areas with weak stops likely through the 1.0920 levels with the market again opening for a test through to 1.1000 however, the market is likely to meet stronger resistance to any moves higher.
• GBP: Opening a little weaker with the rise of the Scottish National Party’s call for another neverendum and its severance from the rest of the UK however, the market continued with a steady dip through to the 1.2190 levels before turning back to hold the 1.2200 areas into the London session, downside bids into the 1.2150 levels are likely to be limited however, possibly stronger bids then appear on a move towards the 1.2100 levels, possibly stronger stops on a break here and the downside vulnerable for another silly move as the banks run for cover, Topside offers light into the 1.2300 areas with the stronger offers likely to be on a move towards the 1.2350 areas with a push here opening the potential for a stronger move on a break above the 1.2400 areas.
• JPY: A quiet session with the market moving off the opening 103.85 levels and tested towards the 104.00 once the market moved into the Tokyo session however, with a lack of volume with the Trade balance number better than expected but a revision of the previous number lower we moved through the session in a 15 tic range for the most part and into the London session holding the 103.90 levels. Topside offers likely to be weak through to the 104.40-50 areas with stronger offers likely to appear, even through that level the market is likely to see offers continuing through to the 105.00 areas however, with the recent ranges broken the market could have the ability to push through towards the 108.00 levels. Downside bids light through to the 103.00 levels with limited bids into the area, better bids are not likely to appear until the 102 level is challenged and the better bids then run downwards increasing into the 100-101 area.
• AUD: A very narrow range for the Oz with the market marking time around the 0.7600 levels dipping through from the opening around the 0.7610 level triggering light stops on a move through the 76 cent levels and holding the 0.7590 area before pushing back higher gain to move into the London session around the 0.7620 levels. Topside offers into the 0.7650 areas with those offers breached several times will likely buckle and allow the market to run towards the stronger offers from 77 cents to the recent 3 month highs around the 0.7750 levels and possibly very strong areas. Downside bids light through to the 75 cents with bids likely to continue through to the 0.7450 levels before any weakness is likely.

Overnight News                                                                  

CNY:

China Should Be Vigilant Against ‘Asset Fever’: Financial News

JPY:

BOJ Watching Banks’ Risk-Taking as Negative Rates Dent Profit

Japan Sept. Exports Fall 6.9% Y/y; Est. -10.8%

Japan Loan Demand from Households Drops in October: BOJ Survey

Nikkei Japan Oct. Flash Manufacturing PMI 51.7 vs 50.4 in Sept.

Japan Ruling Party Candidates Win Tokyo, Fukuoka By-Elections

SGD:

Singapore September Consumer Prices -0.2% Y/y; Est. -0.2%

Today’s data

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

JPY         Trade Balance (JPY) Sep A 0.35T | C 0.21T | P 0.41T | R 0.36T

JPY         PMI Manufacturing Oct (P) A 51.7 | C 50.6 | P 50.4

07:00     EUR        France Manufacturing PMI Oct (P) C 50 | P 49.7

07:00     EUR        France Services PMI Oct (P) C 53 | P 53.3

07:30     EUR        Germany Manufacturing PMI Oct (P) C 54.4 | P 54.3

07:30     EUR        Germany Services PMI Oct (P) C 51.5 | P 50.9

08:00     EUR        Eurozone Manufacturing PMI Oct (P) C 52.7 | P 52.6

08:00     EUR        Eurozone Services PMI Oct (P) C 52.4 | P 52.2

10:00     GBP       CBI Trends Total Orders Oct C -5 | P -5

12:30     CAD       Wholesale Sales M/M Aug P 0.30%

Weekend News

GBP:

May Revives Meetings with U.K. Nations on Brexit Breakup Threat
U.K. Banks to Start Brexit Moves at Christmas, BBA’s Browne Says
London Police Hold Man, 19, in Custody under Terrorism Act
USD:

Clinton Says a Pres. Trump Would Spend Time Suing Women
Trump in Gettysburg Outlines ‘Contract’ With U.S. Voters
AT&T to Buy Time Warner in $85.4 Billion Cash, Stock Deal
JPY/CNY:

China Buys 3 Times More JGBs in Jan-Aug vs Year Ago: Nikkei
JPY:

Sharp to Close Mihara Factory in Japan, Cut LCD Ops: Nikkei
CNY:

China Regulator Tells Banks to Control Property Lending Risks
China Coal Cos. Should Appropriately Manage Output, Supply: NDRC
OIL:

Maduro Says OPEC, non-OPEC Producers Close to Agreement: IFX
Iran Says It Needs $130b-$140b Investment in Oil Output to 2021
TRY:

Turkey PM Yildirim Warns Banks to Stop Loansharking: Hurriyet
Turkey Banks Can Use Scrap Gold to Free Locked-Up Reserves

Harry Hindsight

• EUR: A steady decline through the day saw the Euro opening around the 1.0920 levels and falling back to the 1.0860 through into late NYK on limited volume and nothing particularly joyful news wise from Europe with Eurozone confidence numbers as expected and still weak, the market pushed off the lows twice in light trading however, the level has not been really tested since the beginning of the year and technically looks to be a key level for fresh tests to the 1.0500 levels for the future.
• GBP: A narrow range through the day with the market opening around the 1.2255 levels and then trading in a very narrow 1.2230-50 level through the Asian session, PSBR numbers failed to inspire the market and the market pushed through the 1.2230 levels into the London session and continued to move lower and trigger light stops on the break of the 1.2200 levels pushing down into the NYK session to test to the 1.2170 levels and holding the level in light trading before beginning a steady recovery through to the end of London to push to the 1.2240 areas to finish the day holding the 1.2230 levels again.
• JPY: Asia were steady buyers from the Tokyo opening to take the market back above the 104.00 levels and testing too the 104.20 level before running into offers sufficient to turn the market, the move into the London session saw the market quickly retracing the gains triggering weak stops on the move back through the 104.00 levels and trading to the 103.80 levels and holding deeper into the London session before dipping a little further, the lack of data in the US saw the Euro and GBP movements effecting the JPY more than anything else and the opening in NYK saw the USDJPY dipping further after Cable started to rally and the USDJPY slipped back to test the 103.50 areas before starting a steady move back to the 104.00 level and then finishing the day around the 103.85 areas.
• AUD: The movement through into the NYK session was narrow with the market opening around the 0.7630 levels and holding around the 0.7620-35 levels through the Asian session, the move into the London session saw some early buying however, the market was unable to push through the 0.7650 areas with any conviction before drifting back to the opening levels for the move into NYK, the Oz dropped from the opening and move through the 76 cent levels before finding a base around the 0.7590 levels and then holding around the 76 cent areas to the close.

Friday’s premiership results

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

GBP       Public Sector Net Borrowing (GBP) Sep A 10.1B | C 8.6B | P 10.1B | R 10.3B

CAD       Retail Sales M/M Aug A -0.10% | C 0.50% | P -0.10% | R -0.20%

CAD       Retail Sales Less Autos M/M Aug A 0.00% | C 0.40% | P -0.10% | R -0.20%

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

CAD       CPI Y/Y Sep A 1.30% | C 1.50% | P 1.10%

CAD       BoC CPI Core M/M Sep A 0.20% | C 0.20% | P 0.00%

CAD       BoC CPI Core Y/Y Sep A 1.80% | C 1.80% | P 1.80%

EUR        Eurozone Consumer Confidence Oct (A) A -8 | C -8 | P -8

Stay lucky

Andy

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