Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 112.685 | EURUSD 1.07379 | AUDUSD 0.77052 | NZDUSD 0.70182 | USDCAD 1.33473 | USDCHF 0.99758 | GBPUSD 1.23958 |

 

LMAX Ranges 6am London time

Highs    Lows

EURUSD               1.07650 | 1.07386

USDJPY                 112.753 | 112.478

GBPUSD               1.23947 | 1.23809

AUDUSD              0.77292 | 0.76972

USDCHF               0.99770 | 0.99591

USDCAD               1.33455 | 1.33125

NZDUSD               0.70561 | 0.70175

EURGBP               0.86919 | 0.86689

EURCHF                1.07255 | 1.07142

EURJPY                 121.230 | 120.965

For today

• EUR: With G20 weekend over with and a softening of postures the Euro faired a little better from the opening with the market rising slowly through to the Tokyo session and then testing through to the 1.0760 levels from the opening just below the 1.0740 areas with some stating that Mnuchin’s first G20 was one of unpreparedness than anything contrary as previous statements had indicated, Euro’s, Topside offers light through to the 1.0780 areas where stronger offers build through to the 1.0800 areas, likely stops on a move through the 1.0810-20 areas with another level around the 1.0860 areas and stronger offers appearing, before the topside opens up for a large move above the 1.1000 levels with sentimental levels likely only, Downside bids light into the 1.0700 areas with the market likely to see limited bids before weak stops appear on a move through the 1.0680 areas, and the market finding some support into the 1.0650 areas, with limited data for the day the market is likely to be confined to a tight range, however, a test through the 1.0650 areas will likely see the market testing the stronger 1.0600 areas.
• GBP: A quiet range for the day so far with the market opening around the 1.2390 areas and limited movement to the 1.2395 level to the topside and the downside holding around the 1.2380 areas. Topside offers into the 1.2400 areas with likely weak stops on a move through the 1.2410 areas however, the topside is likely to see plenty of congestion through to the 1.2450 areas and strong offers and continuing congestion to the 1.2500 levels, a push through the level see’s the congestion continuing with good offers likely into the 1.2550 areas before the market opens a little. Downside bids light through to the 1.2300 areas with stronger bids in that area but still not earthshattering, a push through the level sees limited bids until the 1.2250 areas where the bids start to increase on a move through the level and into the 1.2200 areas.
• JPY: The USDJPY eased into the new day trading around the closing/opening level 112.70 areas, the move into the Tokyo session the USDJPY drifted to the 112.50 levels trading along that level through to the grey hours holding the area, Topside offers light into the 113.00-20 areas with limited stops through the level and congestion on the move to the 113.50 areas, stronger offers likely on a move through to the 114.00 area with any move through the level likely to find similar type congestion on a move towards 115.00. Downside bids into the 112.00 levels with congestive bids in front of those strong bids and only a strong push through the 111.80 area is likely to leave the market open to a deeper move with sentimental levels holding the support to slow a fall.
• AUD: A weaker USD saw the Oz push a little higher through the session with the market initially opening lower around the 0.7695 areas trading through to the Tokyo session pushing above the 0.7705 areas, Tokyo took the market quickly to the 0.7720 level before the market stalled and struggled through the next 10 pips to test the 0.7730 level and into the grey hours. Offers into the 0.7735 levels and while this has been the sticking point over the last couple of months a push through is likely to run into the sentimental 0.7740-60 areas and possibly a struggle into the stronger 78 cent levels, downside bids light through to 0.7660-40 with some limited support and possible weak stops through the level to open a test of the 76 cent levels, pushing through the level is likely to see some congestive bids through to the 0.7540 areas and support appearing on a test through the 0.7530-00 areas.

Overnight News                                                                  

Today’s data

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

NZD       Westpac Consumer Confidence Q1 A 111.9 | P 113.1

GBP       Rightmove House Prices M/M Mar A 1.30% | P 2.00%

07:00     EUR        German PPI M/M Feb C 0.40% | P 0.70%

07:00     EUR        German PPI Y/Y Feb C 3.20% | P 2.40%

12:30     CAD       Wholesale Sales M/M Jan C 0.40% | P 0.70%

Weekend News

G20:

G-20 Drops Anti-Protectionist Pledge as Price of U.S. Assent
USD:

Mnuchin at G-20 Plays Nice While Snubbing Rules of World Trade
Mnuchin Says U.S. to Re-Examine Trade Deals Including Nafta
U.S. Told G-20 It Supports International Tax Cooperation: OECD
Keep Trump’s Promise, Pence Tells Republicans on Health Bill

Hawaii Objects to U.S. Request Limiting Scope of Travel Ban
USD/EUR/CNY:

America First’ Trump Play Opens Door for EU-China Trade Detente
USD/CNY:

Tillerson, Chinese Officials Make Good Progress in Talks: Xi
China, U.S. Agree Korea Tensions at Dangerous Level: Tillerson
CNY:

G-20 Should Be ‘Adamantly Against’ Protectionism: China Minister
China Calls for BRICS to Support Free Trade Within G-20
China Growth Prospects Have Improved, PBOC’s Zhou Says at G-20
China’s Economy Has Entered a New Normal, Zhang Says
China Home-Price Rises Regain Speed, Defying Purchase Curbs
China Minister Says Country Can Attract More Investment: Xinhua
China to Ease Restrictions on Foreign Banks: Securities News
JPY:

Mainichi Says It Has Copy of Receipt Tied to Abe School Scandal
Japan’s Aso Says He Told G-20 It’s Vital to Reconfirm FX Pledges
JPY/RUB:

Japan, Russia to Discuss Flights to Disputed Islands: Kyodo
EUR:

Paris Airport Reopens, Probe Launched After Police Kill Gunman
Schaeuble: G-20 Wording on Trade Doesn’t Get us Much Further
Visco Says Negative Rates Are Real Unconventional ECB Policy
Weidmann Says Global Growth Outlook Weaker Than G-20 Desires
France’s Sapin Says U.S. Disagreed With G-20 on Trade, Climate
Italy’s Padoan Says There Was Clear Divergence on Trade at G-20
France’s Macron 1st-Round Support Slips, Le Pen Stable: BVA Poll
KRW:

North Korea Succeeds in Engine Test for New Rocket Type: NHK
GBP:

Hammond Says EU Stance on Brexit Bill is `Negotiating Position’
CHF:

SNB Policy Is Not One of Competitive Devaluation, Jordan Says
Swiss Attractive Even If Trump Cuts Company Tax, Maurer Says
CAD:

Canada’s Morneau Says U.S. Agreed with G-20 on Trade Importance
TRY:

Turkey Outlook to Negative by Moody’s, Rating Affirmed
RUB:

Russia on Cusp of Exiting Junk as S&P Outlook Goes Positive
PHP/CNY:

Duterte Sees Nothing Wrong With Chinese Ships in Philippine Seas
CZK:

Rusnok Sees Exit from Czech Koruna Cap around Mid-2017: Denik

 

Harry Hindsight

• EUR: A quiet range through the Asian session with the market ranging around the 1.0770 levels through into the grey hours, early buyers took the market higher testing the 1.0780 areas before early London came in selling strongly and taking the market back to the 1.0755 areas, the official opening saw the high tested again however, it was short lived and a weaker Eurozone trade balance saw the market drop quickly lower through to the 1.0735 areas with the market basing along that level through the day, with only a slight extension of the downside lows with the market testing through the 1.0730 level. The market finished the day only just off those lows in a quiet end to the day.
• GBP: Opening around the 1.2360 levels the market slipped a little lower through into the Asian session testing the 1.2345 levels and then holding the 1.2350-55 for the move into the grey hours, early London sold the market down to the 1.2325 areas from the 1.2370 level before the market bounced higher as the market squeezed back through the highs triggering a few stops as the market tested into the 1.2400 areas, the market struggled through the early part of London with the opening levels coming under pressure with the market eventually moving through into the NYK session slowly moving higher through to push again through the 1.2400 levels in thin trading until the figure areas and then slipping a little lower into the close.
• JPY: Opening around the 113.30 level the market rose a little into the 113.50 areas through into the Tokyo session before drifting back to the opening levels into the grey hours, the move through the London session saw the market slipping slowly lower with the market trading into the NYK session testing the 113.00 areas and the release of better numbers did little to save the market from triggering stops on the move down through the 113.00 areas quickly hitting the 112.80 areas and eventually holding the 112.60 levels through to the close.
• AUD: A quiet session over all with the market gradually moving higher through the day, opening around the 0.7675 levels the market drifted and based along the 0.7665 area through to the grey hours lifting off the lows to move through the 0.7690 area and then quickly decline again as early London sold the Oz to test the lows again before starting a steady climb higher as the official opening hit, the move into the early NYK period saw the market testing the 77 cent levels and the opening saw the market break and hold above the level, US numbers saw the market peak around the 0.7715 levels and the move through to the close saw the market move around the 77 cent extending the high slightly before drifting to a close around the 0.7705 level.

Yesterday’s premiership results

NZD       Business NZ Manufacturing Index Feb A 55.2 | P 51.6 | R 52.2

EUR        Eurozone Trade Balance (EUR) Jan A 15.7B | C 22.3B | P 24.5B | R 23.1B

CAD       Manufacturing Shipments M/M Jan A 0.60% | C -0.40% | P 2.30%

USD       Industrial Production Feb A 0.00% | C 0.30% | P -0.30% | R -0.10%

USD       Capacity Utilization Feb A 75.40% | C 75.50% | P 75.30% | R 75.50%

USD       U. of Michigan Confidence Mar (P) A 97.6 | C 97 | P 96.3

USD       Leading Indicators Feb A 0.60% | C 0.20% | P 0.60%

Stay lucky

Andy

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