Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 104.184 | EURUSD 1.08816 | AUDUSD 0.76116 | NZDUSD 0.71256 | USDCAD 1.32874 | USDCHF 0.9937 | GBPUSD 1.22383 |

LMAX Highs and Lows 5am GMT

                                High | Low

EURUSD               1.08816 | 1.08678

USDJPY                 104.497 | 104.152

GBPUSD               1.22407 | 1.22182

USDCHF               0.99454 | 0.99325

AUDUSD              0.76308 | 0.75893

USDCAD               1.33611 | 1.32758

NZDUSD               0.71543 | 0.71095

EURCHF                1.08159 | 1.08073

EURGBP               0.89097 | 0.88916

EURJPY                 113.669 | 113.316

For Today

• EUR: Dull with a capital D but a little bit better volume wise with the Euro stuck in the 1.0870-80 levels dipping from the opening to make lows just below 1.0870 into the Tokyo session and then reversing to the 1.0880 level for the run to London, Topside offers light through the 1.0880 levels with slightly stronger offers into 1.0900-20 areas however, the level is likely to be still limited in the area with better offers likely to continue above the 1.0950 areas through to 1.1000 with US consumer confidence likely to be of more importance. Downside bids into the 1.0860 area with possible weak stops on a move through the 1.0840 areas and only limited bids into the 1.0800 areas vulnerable if the market can push through there and then possibly opening up the range down to 105 as seen through 2015.
• GBP: Well the arrange was a little larger than the Euro however, the movement was still limited and having dropped from the opening 1.2235 areas to move into the Tokyo session trading the 1.2215 levels the market moved tightly for the most part in the 1.2215-25 areas with limited test to the 1.2210 levels before making a little last gasp move to the opening levels and ranging to the London session around the 1.2225 with volumes suspect. Topside offers into the 1.2250 level now showing over the past couple days however, the level is still suspect and a move through has stronger offers on any moves above the 1.2300 levels with weak stops probably positioned through the 1.2320 level and then only limited to congestion on a move towards the stronger 1.2400 levels exposing the possibility of a stronger move higher.
• JPY: Yesterdays lift above the 104.00 levels set the market for another test into the 104.50 levels and from the opening the market moved steadily towards the level moving into the Tokyo session pushing through the 104.45 levels but never quiet challenging the 104.50 levels which has been the sticking point all this month however, the market has remained in the area of 104.40 for the bulk of the session with volumes reasonable for the USDJPY, while the 104.50 level has been sticky for the month weak stops are likely to be behind the area and the market opens quickly for a test to the 105.00 levels with congestion likely to be around the level and then opening the range up towards the 107 areas. Downside bids finding congestion now around the 103.50 areas and stronger bids likely to be into the 103.00 areas with weak stops on a push through the 102.80 areas.
• AUD: Opening around the 0.7610-15 areas the market quickly dropped back from the opening and the move into the Tokyo session saw the market pressing the 0.7590 levels and the low for the day as the market bounced off the level and Oz gained with the help of light AUDJPY buying with the market in USDJPY up against the resistance level, the Oz pushed back to the 0.7625 areas and held the areas for a decent amount of time and the run to the London session saw the market gaining a few more tics pushing to the 0.7630 area. Topside offers through the 0.7640 areas with congestive offers through the level and likely to continue through the 77 cent levels with stronger offers likely then to start appear, with 0.7750 level a tough level to push through with the level general holding from August with several pushes with diminishing returns since, Downside bids light through to the 76 cent level then possibly stronger with recent week seeing dips through the level but seeing bids quickly move in with weak stops possibly appearing on a move through the 0.7580 areas and 0.7540 level with congestion in-between.

Today’s data

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

08:00     EUR        German IFO – Business Climate Oct C 109.5 | P 109.5

08:00     EUR        German IFO – Current Assessment Oct C 114.8 | P 114.7

08:00     EUR        German IFO – Expectations Oct C 104 | P 104.5

13:00     USD       House Price Index M/M Aug C 0.50% | P 0.50%

13:00     USD       S&P/Case-Shiller Composite-20 Y/Y Aug C 5.10% | P 5.02%

14:00     USD       Consumer Confidence Oct C 101 | P 104.1

Harry Hindsight              

• EUR: Early selling in the Asian session saw the market dipping back to test the 1.0860 levels again and as before the level held and Asia saw a slight recovery into the move into the London session, PMI numbers were better than expected across the board and the Euro quickly moved up through the opening levels around the 1.0880 areas and eventually tested towards the 1.0900 levels into the NYK session, however, NYK were steady sellers through a quiet session dipping back to the 1.0870 levels before holding the level and ranging to the close around the 1.0875 areas.
• GBP: A little rangy over the day with the market pinned between the 1.2200-50 level for the most part with early trading in Asia showing the market dipping down from the opening to test through the 1.2190 levels to set the lows for the day, rising back to the 1.2200 level areas the market pushed back higher with weak stops triggered through the level and the Euro helping the Cable rise through to test towards the 1.2250 level and hold the areas into the NYK session and the steady rise of the USD in a quiet market, although the market tested back to the 1.2200 levels the end of the day saw a nervous rise off those lows to finish the day a little higher than the opening.
• JPY: USDJPY moved from the opening quietly to test through to the 104.00 levels however although the market was unable to break through the level the market remained in touch with the areas with the range through Asia being broadly 103.85-104.00 area, the move into the London session saw the downside tested but only marginally moving off the 103.75 levels to move back into the tight range into the NYK session and early buyers eventually pushed the market through the 104.00 levels for a stronger test later in the session pushing into weak stops and a move to the 104.30 level before grinding to a halt in quiet trading through to the close.
• AUD: Oz was again quiet with some light AUDJPY cross selling early in the session to take the market down back through the opening 0.7610 areas to test towards the 0.7590 levels for a brief period, the move through the Asian session saw the Oz gradually regaining the highs and the move towards the London session saw weak stops triggered and the market continuing its quiet rise through to the 0.7640 areas before struggling from mid-morning London to the NYK sellers, NYK sold the market back towards the lows and the market really did struggle from that point and managed to regain 0.7615 into the close with light profit taking in low volume allowing the move.

Yesterday’s premiership results

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

EUR        France Manufacturing PMI Oct (P) A 51.3 | C 50 | P 49.7

EUR        France Services PMI Oct (P) A 52.1 | C 53 | P 53.3

EUR        Germany Manufacturing PMI Oct (P) A 55.1 | C 54.4 | P 54.3

EUR        Germany Services PMI Oct (P) A 54.1 | C 51.5 | P 50.9

EUR        Eurozone Manufacturing PMI Oct (P) A 53.3 | C 52.7 | P 52.6

EUR        Eurozone Services PMI Oct (P) A 53.5 | C 52.4 | P 52.2

GBP       CBI Trends Total Orders Oct A -17 | C -2 | P -5

CAD        Wholesale Sales M/M Aug A 0.80% | C 0.20% | P 0.30%

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.