Andy Harrison
Good morning,
LMAX Close
USDJPY 114.525 | EURUSD 1.06432 | AUDUSD 0.75003 | NZDUSD 0.71284 | USDCAD 1.31158 | USDCHF 1.00894 | GBPUSD 1.21946 |
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LMAX Ranges 6am London time
Highs   Lows
EURUSDÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 1.06359 | 1.06051
USDJPYÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 114.499 | 113.914
GBPUSDÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 1.20553 | 1.20146
AUDUSDÂ Â Â Â Â Â Â Â Â Â Â Â Â 0.75056 | 0.74692
USDCHFÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 1.01161 | 1.00922
USDCADÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 1.31444 | 1.31206
NZDUSDÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 0.71489 | 0.70886
EURGBPÂ Â Â Â Â Â Â Â Â Â Â Â Â Â 0.88525 | 0.88123
EURCHF Â Â Â Â Â Â Â Â Â Â Â Â Â Â 1.07383 | 1.07255
EURJPYÂ Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â 121.700 | 121.023
For today
- GBP: A report in the Sunday Times suggested that Tuesday’s speech by UK PM Theresa May will signal plans for a hard Brexit by saying she will be willing to quit the Europeans Union’s single market for goods and services to regain control of Britain’s borders and laws, however, the report did not attribute the source and while the market was always going to react to the article where else would the UK start but at the worst case scenario and go forward with that, opening around the 1.2020 areas having seen pre-market testing a little lower in an illiquid market, the market traded lightly through the 1.2050 areas into the Tokyo session before slipping back with cross selling dominating the market, the Cable ran quietly for a short period along the 1.2020 levels before rising back to the 1.2040 level and holding through to the grey hours, downside bids more sentimental around the 1.2000 areas with possibly better bids into the 1.1930 areas become very vulnerable on a push lower and below that well its anyone’s guess, the only good thing for the day is the US is closed for Martin Luther King day so is possibly going to be quiet for the most part, topside offers light through the 1.2050-60 area with limited offers through the 1.2100 level and limited stops, a move through the level will likely see limited congestion through 1.2150 however the possibility of a short squeeze through that area will be all dependent on liquidity through the day.
- EUR: As the session progressed President elect Trump made less than favourable remarks on the subject of the European Union, stating that a trade agreement with the UK would be quick in coming and that the UK would not be the last to break from the Union, he also stated that NATO was obsolete and was probably a direct swipe at the continual underfunding of NATO forces across Europe over the decades and Europe’s reliance on the US. Opening a little lower from Friday’s close the Euro played second fiddle to the GBP with the drag of the GBP, then seeing the EURGBP sold back from the opening highs around the 0.8845 levels to test 0.8810 moving the Euro to its Topside offers likely light through the 1.0640-60 areas with stronger offers likely into the 1.0680-1.0700 areas with weak offers likely to appear on a move through the 1.0710-20. Downside bids congested through the 1.0550 levels with better bids on a move through 1.0500 areas and the 1.0450 areas very congested.
- JPY: A slow drift lower with the market initially opening around the 114.40 areas and then giving ground before the move into the Tokyo session, the market recovered to the opening levels but then drifting through the balance of the session testing the 114.00 levels in a quiet day for the JPY, Topside offers through the 114.50 areas is likely to be light with only limited offers through the 115.00 areas however, with a US bank holiday this is likely to be limited in movement and more likely to be affected by Cross trades through Euro and GBP. Downside bids into the 113.80 levels tested through last week and still in the way, a break here will likely see weak stops dominating the market and better bids as the market trades towards the 113.20 areas if it can make it.
- AUD: Very quiet session for the Oz missing much of the story lines and so having made the highs before Tokyo on cross Oz dealing with the market barely making it above the 0.7505 levels before drifting through the Tokyo session to test the 0.7470 levels and holding into the grey hours. Topside offers through the 75 cent levels that have dominated the last week and dating through to end of last year a push through the 0.7530 areas could possibly see weak stops opening the market to the 76 cent levels, Downside bids light through the 74 cent areas with a little bit of congestion on moves through to the 0.7350 areas however, a quiet day is likely for the pair unless it gets dragged around with the GBP and Euro.
Overnight News                                                                 Â
GBP:
U.K. Said to Seek to Calm Investors After May’s Brexit Speech
U.K. January House Prices Rise 0.4% M/m, Rightmove Says
EUR/GBP:
ESM’s Regling Says It Looks like It May Be a ‘Hard Brexit’
CNY:
China Should Let Yuan Float, Researcher Says: Sec. Journal
China MOF to Study Local Govt Bond Yield Compiling Method: News
JPY:
Japan Nov. Core Machine Orders Fall 5.1% M/m; est. -1.7%
Japan to Sell Up to 1.4t Yen Additional Japan Post Shares: Nikkei
BOJ Raises View of 3 Domestic Regions, Keeps Rest Unchanged
SGD:
Singapore Economy to Continue Modest Expansion in 2017: MAS
Singapore Dec private home sales down 57.3% month-on-month
AUD:
Australia Dec. Melbourne Inst. Inflation Gauge Rises 0.5% M/m
Today’s data
Actual = A | Consensus = C | Previous = P | Revised = R All timings GMT
JPYÂ Â Â Â Â Â Â Â Machine Orders M/M Nov A -5.10% | C -1.40% | P 4.10%
JPYÂ Â Â Â Â Â Â Â Domestic CGPI M/M Dec A 0.60% | C 0.40% | P 0.40%
AUDÂ Â Â Â Â Â TD Securities Inflation M/M Dec A 0.50% | P 0.10%
GBPÂ Â Â Â Â Â Rightmove House Prices M/M Jan A 0.40% | P -2.10%
JPYÂ Â Â Â Â Â Â Â Tertiary Industry Index M/M Nov A | C 0.20% | P 0.20%
06:00Â Â Â Â JPYÂ Â Â Â Â Â Â Â Machine Tool Orders Y/Y Dec (P) P -5.60%
10:00Â Â Â Â EURÂ Â Â Â Â Â Â Eurozone Trade Balance (EUR) Nov C 20.8B | P 19.7B
Weekend News
GBP:
May to Seek Hard Brexit by Leaving EU Market, Sunday Times Says
USD/CNY/RUB:
Trump Says Will Be Flexible in Relations With China, Russia: WSJ
USD:
Senate Panel to Probe If Trump Team Had Contact With Russia
Trump Administration May Remove Press From White House: Esquire
USD/RUB:
Trump Wants to Hold Summit With Putin in Reykjavik: Sunday Times
Trump Says Sanctions on Russia to Stay at First, WSJ Reports
CNY/USD:
China Urges U.S. to Recognize ‘High Sensitivity’ of Taiwan Issue
CNY:
Chinese Economy May Hit Bottom in 2017, Economist Says: Xinhua
Shanghai to Strengthen Property Market Rules in 2017: Report
Floating FX Rate Won’t Fix China Problems: Former SAFE Official
China Targets 3%-6% Rise in Profits of State-Owned Enterprises
CNY/VND:
China, Vietnam Sign Joint Communique on S. China Sea: Xinhua
JPY:
Japan’s Top Real Estate Firms to Report Record Profits: Nikkei
JPY/USD:
Mitsubishi Tanabe May Buy a U.S. Drug maker for 200b Yen: Sankei
JPY/AUD:
Japan, Australia Vow to Work with Trump on Regional Security
JPY/IDR:
Japan, Indonesia to Cooperate in Defence, Maritime Security
TRY:
Turkey PM Says Rate Increase Shouldn’t Be First Choice: Hurriyet
Turkey ’Must Spoil This Foreign Currency Game,’ Erdogan Says
AUD:
Australian Finance Minister Under Scrutiny for Weekend Trips
CHF:
Zurbruegg Says Negative Rate, SNB Interventions Fundamental: NZZ
Swiss Econ Min Says Franc Shock May Hit Companies: NZZ
CHF/EUR:
SNB Wants to Keep Rate Differential With Euro: Zurbruegg to NZZ
EUR/USD:
Merkel Says Will Seek Common Ground with Trump on Economy
EUR/RUB:
Germany Sees Russia Undermining Transatlantic Ties: Spiegel
OIL:
Iran Has No Oil Stored Offshore in Floating Storage: Mehr
Harry Hindsight
- EUR: A fairly quiet day with the run in for a long weekend in the US and Martin Luther King day on Monday, opening around the 1.0615 areas the market traded in a tight range around the 1.0610 levels late into the Tokyo session before pushing up from the 1.0605 areas into the grey hours and trading into the London session opening around the 1.0640 levels, no real data for the Euro didn’t help much and the market could only make it to the 1.0655 areas before the NYK session started, Advance retail sales saw the numbers balanced with a slight shortfall for the months number but a revision of last month however, less auto’s showed a less than sterling number initial selling of USD’s disappeared and the Euro dropped from the 1.0675 area highs dipping into the next set of numbers and a number showing a build-up of inventories reversing the lows around the 1.0600 level and a steady trade back to the 1.0650 areas for a close closer to 1.0640.
- GBP: Less dramatic through the day for the Cable with the market trading quietly through the Asian session around the 1.2160 dipping to the 1.2140 areas in early selling before steadily recovering over the course of the session to trade above the 1.2170 levels, the move into the grey hours saw the market steadily rise through the morning session to test through the 1.2220 area however, the market was unable to hold the level and the market started to drift into the NYK session and a steady drift through with limited movement through the numbers but generally mirroring the Euro’s with the market moving higher again and lightly trading through the same 1.2220 level before finishing the day just short of the 1.2200 areas.
- JPY: Opening around the 114.80 areas the move into the Tokyo session saw the market test steadily through the 115.00 area, the market struggled to push through the 115.20 levels and traded around the 115.00 levels through into the grey hours before the USD sellers reappeared and the market slipped through to the London opening and the 114.60 levels, the market remained in the area until the NYK opening and the release of the first set of numbers, with the market couching the 114.20 areas a mixed reaction and the market bounced to the 114.60-70 areas triggering weak stops and pre-empting possible profit taking and a little bit of a squeeze ensued with the USDJPY trading through to the 115.40 before drifting through to the London close and back to the 115.00 levels, end of week and position liquidity before the long weekend saw the USDJPY then drifting for the session and finishing the day holding around the 114.50 areas.
- AUD: For the most part the Oz held a very quiet range with the largest moves coming around the numbers in the US, opening around the 0.7485 levels the market repeatedly tested above the 75 cent levels with very little conviction and possibly more to do with the long weekend ahead, having tested for the first time the market dipped back to the 0.7480-85 areas for the run into the grey hours, early buyers again tested the topside offers above the 75 cent level and the market then traded around the 0.7490 areas for the long run into the grey hours and the US numbers, as with the rest of the market USD’s climbed and the Oz dipped to the 0.7450 levels before the inventories and Michigan numbers did their work to reverse the dip and the market rallied to the opening levels and then steadily rose to challenge the highs into the close of the day.
Yesterday’s premiership results
JPYÂ Â Â Â Â Â Â Â Japan Money Stock M2+CD Y/Y Dec A 4.00% | C 4.10% | P 4.00% | R 3.90%
CNYÂ Â Â Â Â Â Â Trade Balance (USD) Dec A 40.8B | C 47.6B | P 44.6B
CNYÂ Â Â Â Â Â Â Trade Balance (CNY) Dec A 335B | C 345B | P 298B
USDÂ Â Â Â Â Â PPI M/M Dec A 0.30% | C 0.30% | P 0.40%
USDÂ Â Â Â Â Â PPI Y/Y Dec A 1.60% | C 1.60% | P 1.30%
USDÂ Â Â Â Â Â PPI Core M/M Dec A 0.20% | C 0.10% | P 0.40%
USDÂ Â Â Â Â Â PPI Core Y/Y Dec A 1.60% | C 1.50% | P 1.60%
USDÂ Â Â Â Â Â Advance Retail Sales Dec A 0.60% | C 0.70% | P 0.10% | R 0.20%
USDÂ Â Â Â Â Â Retail Sales Less Autos Dec A 0.20% | C 0.50% | P 0.20% | R 0.30%
USDÂ Â Â Â Â Â Business Inventories Nov A 0.70% | C 0.50% | P -0.20% | R -0.10%
USDÂ Â Â Â Â Â U. of Michigan Confidence Jan (P) A 98.1 | C 98.5 | P 98.2
Stay lucky
Andy
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