Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 111.716 | EURUSD 1.08109 | AUDUSD 0.7691 | NZDUSD 0.70487 | USDCAD 1.33520 | USDCHF 0.99387 | GBPUSD 1.24791 |

LMAX Highs and Lows 6am GMT

                                High | Low

EURUSD               1.08177 | 1.07886

USDJPY                 111.774 | 111.434

GBPUSD               1.24859 | 1.24642

USDCHF               0.99464 | 0.99308

AUDUSD              0.76894 | 0.76506

USDCAD               1.33867 | 1.33485

NZDUSD               0.70463 | 0.70164

EURCHF                1.07421 | 1.07288

EURGBP               0.86696 | 0.86496

EURJPY                 120.813 | 120.354

For Today

• EUR: A little mixed with the market opening around the 1.0810 areas to test into high teens before drifting off the early highs and into the Tokyo session slipping below the 1.0800 areas to the 1.0790 area and then based along that level before lifting back above the 1.0800 levels for the run into the grey hours, Topside offers into the 1.0820 areas with likely weak stops just beyond the level and light congestion through the 1.0840-60 areas and limited through to the 1.0900 areas with possible stronger offers into the area, Downside bids light through to the 1.0760 areas with limited bids through to the 1.0740 with weak stops through the area and limited bids to the 1.0710 area.
• GBP: Very quiet for the Cable with the market opening around the 1.2480 areas and minor deviations from the level with a dip along the 1.2470 level before rising back to the level for the move into the grey hours, congestion around and through the 1.2550 areas with the stronger offers likely around that level and then opening to a test of the 1.2600 areas limited offers with possible strong stops on a push through the level, downside bids into the 1.2450 areas are congestive rather than supportive with the market likely to continue to stronger bids into the 1.2400 area and stops likely on a move through that level.
• JPY: The USDJPY opened around the 111.70 areas and pushed quickly lower in early trading to the 111.50 areas before holding around the level and pushing steadily back to the opening levels, the market continued to range through the session before heading into the grey hours holding mid-range. Topside offers light back through the 112.00 areas with weak stops likely through the 112.20 areas for a quick move back the 112.50 areas, light offers continue through the level with possibly stronger offers moving into the 113.00 areas. Downside bids light through the 111.00 areas with the likelihood of limited sentimental buyers, with weak stops likely through the level and the market then seeing stronger bids on a test towards the 110.50 areas and congestion through the level continuing through to the 110.00 areas.
• AUD: A quiet drift lower with the market opening just below the 0.7690 areas and then slowly drifting down to test the 0.7650 areas with leading index a little below expectations the market held the level and pushed back to range around the 0.7660-70 through to the grey hours with very little independent movement, Topside offers through the 77 cent levels likely to be more speculative until the stronger 0.7750 areas and likely to continue through to the 0.7780 areas a push through the level will likely see light stops and the market likely to remain offered through to the 0.7840 areas however, a break through the level is likely to see stronger stops appearing and if the market can push quickly through the 0.7860 areas the market opens for a longer term push to above the 80cent levels. Downside bids through to the 0.7640 areas with the bids while lighter continued through to the 76 cent level and congestive bids likely to continue through to 0.7580 areas and weak stops appearing however, the congestion is likely to continue with bids through to the 75 cent and a long grind.

Overnight News

USD:

Fed’s Mester Says Open to Changing Balance Sheet Policy in 2017

Fed’s Mester Says Improved Sentiment Not Yet Showing in Economy

Fed’s Mester: I’ve built Some Fiscal Stimulus in My Forecasts

Fed’s Rosengren Warns About Dangers in Commercial Real Estate

JPY:

Aso: Not Trying to Weaken Yen Through Monetary Easing

Kuroda: Perpetual Bonds Won’t Reduce Japan’s Debt Burden

BOJ Board: Daily Market Ops Have No Implications for Policy

BOJ’s Funo: It’s Important to Continue Powerful Monetary Easing

Japan Seeking More JGB Bids from Primary Dealers: Nikkei

Japanese Exports Jump Most in Two Years, Led by Sales to China

KRW:

North Korea May Have Launched Missiles Earlier: Kyodo

KRW: S. Korea Says North Fired Missile in Unsuccessful Launch: Yonhap

KRW: North Korea to Hold Supreme People’s Assembly April 11

GBP:

Theresa May Said to Reject Demand for Scotland Referendum: Times

CNY/HKD:

Net Inflow to China via H.K. Fund Program 97.4m Yuan End-Feb.

CNY:

China Economy May Face More Downward Pressure in 2H: Info Daily

AUD:

Australia’s Feb. Leading Index Falls 0.07% M/m to 97.54

PHP/CNY:

Philippines Asks China to Clarify Plan, Monitors Disputed Shoal

TRY/EUR:

Turkey to Cut Cooperation w/ EU on Refugees If Deal Fails: Celik

Today’s data

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

AUD       Westpac Leading Index M/M Feb A -0.10% | P 0.00%

JPY         BOJ Minutes (Jan 30-31)

JPY         Trade Balance (JPY) Feb A 0.68T | C 0.55T | P 0.16T | R 0.20T

JPY         All Industry Activity Index M/M Jan A 0.10% | C 0.00% | P -0.30% | R -0.20%

09:00     EUR        Eurozone Current Account (EUR) Jan C 29.3B | P 31.0B

13:00     USD       House Price Index M/M Jan C 0.40% | P 0.40%

14:00     USD       Existing Home Sales Feb C 5.59M | P 5.69M

14:30     USD       Crude Oil Inventories P -0.2M

20:00     NZD       RBNZ Rate Decision C 1.75% | P 1.75%

Harry Hindsight

• EUR: A slight dip from the opening to set the lows for the day trading down to the 1.0720 level before Tokyo took the market quickly back through the opening 1.0740 areas and pushing through the 1.0750 a little slower, the rise continued in the first few hours of Tokyo and eventually stalled at the 1.0770 areas before ranging around the 1.0760 through to the grey hours, London were steady buyers through the session with the market rising through to the 1.0800 levels with the market struggling with the 1.0820 areas for the move into the NYK session and unable to gain any further ground holding the 1.0800-20 levels to the close.
• GBP: A slow start to the day with the market opening around the 1.2360 areas with Tokyo slowly buying to the 1.2380 areas, that was the high for Tokyo and the market slipped slowly lower through the rest of the period into the grey hours with the market testing down to the 1.2340 areas, Early London were quick buyers, the market rose steadily into the 1.2390 levels the release of stronger inflationary numbers saw the market push quickly through the 1.2400 areas triggering weak stops on the move to the 1.2450 level as the sellers backed away from the market, the move through to the NYK session saw a quiet range ranging between the 1.2450-70 levels for the most part with limited pushes to the 1.2480 areas, the move into the close of London saw a final push and the market pushing above the 1.2490 areas and a range through to the close holding around the 1.2480 areas.
• JPY: A quiet move through to the Tokyo session with the USD weakening into the new session and the market testing the 112.30 levels, the market eventually recovered rising to the 112.60 areas and the move through to the grey hours saw a steady rise to range around the 112.80 levels peaking just above the 112.85 areas and through the grey hours, the opening in London saw the market slip back as the USD weakened in the face of a rising GBP and although NYK bought the USDJPY a little the break back below the 112.50 areas with sellers increasing as the market testing back to the 112.00 areas and grinding through the bids into the 111.80 areas, with brief moves to the 111.50 levels as weak stops were triggered and holding then to the close around the 111.70 areas.
• AUD: A wider range for the Oz over the day, with the market opening around the 0.7730 areas and struggling to touch above the 0.7735 areas over the early part of the day, the move through deeper into the session saw the market slip slowly lower through the session as the USD strengthened a little with the Oz testing down to the 77 cent levels, the market based off that level through into the London session with a lack of day traders jumping in from the London opening however, the buyers steadily appeared as the market again ran back to the opening levels and into the NYK session, NYK attempted to push the market through the 0.7750 areas, after a couple hours of pushing at the level the market dropped back quickly to the 77 cent areas and the market eventually broke late in the session triggering some light stops on a dip into the 0.7680 areas and the close.

Yesterday’s premiership results

AUD       House Price Index Q/Q Q4 A 4.10% | C 2.50% | P 1.50%

AUD       RBA Minutes

CHF        SECO March 2017 Economic Forecasts

CHF        Trade Balance (CHF) Feb A 3.11B | C 3.85B | P 4.73B | R 4.83B

GBP       CPI M/M Feb A 0.70% | C 0.50% | P -0.50%

GBP       CPI Y/Y Feb A 2.30% | C 2.10% | P 1.80%

GBP       Core CPI Y/Y Feb A 2.00% | C 1.70% | P 1.60%

GBP       RPI M/M Feb A 1.10% | C 0.80% | P -0.60%

GBP       RPI Y/Y Feb A 3.20% | C 2.90% | P 2.60%

GBP       PPI Input M/M Feb A -0.40% | C 0.10% | P 1.70% | R 1.60%

GBP       PPI Input Y/Y Feb A 19.10% | C 20.10% | P 20.50% | R 20.10%

GBP       PPI Output M/M Feb A 0.20% | C 0.30% | P 0.60%

GBP       PPI Output Y/Y Feb A 3.70% | C 3.70% | P 3.50% | R 3.60%

GBP       PPI Output Core M/M Feb A 0.00% | C 0.20% | P 0.50%

GBP       PPI Output Core Y/Y Feb A 2.40% | C 2.50% | P 2.40%

GBP       House Price Index Y/Y Jan A 6.20% | C 6.30% | P 7.20% | R 5.70%

GBP       Public Sector Net Borrowing (GBP) Feb A 1.1B | C 2.9B | P -9.8B | R -11.7B

GBP       CBI Trends Total Orders Mar A 8 | C 5 | P 8

CAD       Retail Sales M/M Jan A 2.20% | C 1.30% | P -0.50% | R -0.40%

CAD       Retail Sales Less Autos M/M Jan A 1.70% | C 1.30% | P -0.30% | R -0.50%

USD       Current Account (USD) Q4 A -112B | C -129B | P 113B | R -116B

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.