Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 110.896 | EURUSD 1.0670 | AUDUSD 0.76051 | NZDUSD 0.7002 | USDCAD 1.3381 | USDCHF 1.00147 | GBPUSD 1.24863 |

LMAX Highs and Lows 5am GMT

                                High | Low

EURUSD               1.06738 | 1.06632

USDJPY                 110.891 | 110.374

GBPUSD               1.24956 | 1.2459

USDCHF               1.00214 | 1.00122

AUDUSD              0.76154 | 0.75779

USDCAD               1.33959 | 1.33745

NZDUSD               0.70222 | 0.69825

EURCHF                1.06906 | 1.06838

EURGBP               0.85619 | 0.85377

EURJPY                 118.304 | 117.742

For Today

• EUR: A quiet drift through the Tokyo session with the market ranging between the 1.0675-63 areas through to the grey hours with cross Euro’s doing more work than straight Euro, Topside offers into the 1.0680 levels for the moment seem to be a little larger than you’d expect with those offers likely to continue through the 1.0700 areas with weak stops likely on a push through the 1.0710-20 areas however, the market is likely to see some congestion through to the 1.0750 areas with increasing offers on a move through the level and into the stronger 1.0800-20 areas. Downside bids into the 1.0650 areas with light congestion on any move towards the stronger 1.0600 areas and continuing congestion through the level if it can manage a move down.
• GBP: Opening around the 1.2485 areas the market slowly pushed through to the 1.2495 levels over the bulk of the session then traded around the 1.2490 areas until close to the grey hour when the market dropped quickly to the 1.2460 area before bouncing to the 1.2470 for the move into the grey hour, there was very little news around so one assumes a single ticket of size moving through the market, Topside offers into the 1.2500 levels are likely to be light with the market finding more resistance on a move to the 1.2550 areas, any break here will likely see weak stops appearing and the market to the 1.2600 level becoming a little vulnerable however, 1.2600-30 is likely to be far more stubborn and only a strong push through the level will open up a fresh test of the 1.2700 levels not seen since Feb, downside bids light through to the 1.2450 areas with congestive bids in that area before the market opens to fresh test of the 1.2400 areas with weak stops on a move through the level however, stronger bids are likely into the 1.2350 areas
• JPY: USDJPY continued its drift lower through the session opening around the 110.90 areas and then losing ground once the Tokyo session opened to push down to the 110.50 areas the market initially held the level and it wasn’t until late in the session that the market eased through the area and pushed to the 110.40 areas leading into the grey hour, Topside offers weak through the 111.00 areas with congestive offers likely to continue to a stronger 111.50 areas with weak stops likely on a move through the 111.60 level for a renewed push at the 112.00 stronger areas, downside bids light through to the 110.20 areas with stronger bids likely into the more sentimental level of 110.00, likely strong stops on a move through the 109.80 areas with the market opening to a weaker range through to the 1.0800 levels with weaker sentimental levels expected.
• AUD: The market looked set for a quiet range again with the session opening around the 0.7605 areas, the move into the Tokyo session saw the market test to the 0.7690 levels before finding some support and slowly pushing back through the 76 cent level and pushing to the 0.7615 areas, no change from the RBA saw the market drop back quickly testing to the 0.7580 areas before finding some support and holding into the grey hour, Topside offers into the 0.7640-60 levels are possibly rebuilding with stronger offers on a move through into the 77 cent level, congestive offers and 0.7750 the key level for any further moves higher, with strong stops likely through the 0.7760 areas, Downside bids through the current levels with congestive bids likely to appear all the way down to the strong supportive 75 cent areas, weak stops likely on a strong push low however, for the moment there does not seem to be any reason for the market to become any more active than we’ve seen for the bulk of the year so far.

Overnight News

AUD:

RBA Extends Rate Pause as Property’s Heat Meets Economic Slack

Australia Feb. Trade Surplus A$3.57 Bln; Est. A$1.90 Bln

Australia ANZ Weekly Consumer Confidence Falls 2.4% to 111.1

JPY:

Kuroda: BOJ’s ETF Purchases Aren’t Distorting Market Function

Japanese Cos Inflation Expectations Unchanged From 3 Months Ago

NZD:

New Zealand Business Confidence Falls to One-Year Low: NZIER

New Zealand Survey Shows Steady Growth, Faster Inflation: NZIER

New Zealand Raises Forecast 2016-17 Primary Sector Exports

RUB/USD:

Putin, Trump Agree Terrorism Should Be ‘Combated Together’

Today’s data

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

JPY         Monetary Base Y/Y Mar A 20.30% | C 23.20% | P 21.40%

AUD       Trade Balance (AUD) Feb A 3.57B | C 1.75B | P 1.30B | R 1.50B

AUD       RBA Rate Decision A 1.50% | C 1.50% | P 1.50%

08:30     GBP Construction PMI Mar C 52.5 | P 52.5

09:00     EUR Eurozone Retail Sales M/M Feb C 0.50% | P -0.10%

12:30     CAD International Merchandise Trade (CAD) Feb C 0.7B | P 0.8B

12:30     USD Trade Balance Feb C -46.0B | P -48.5B

14:00     USD Factory Orders Feb C 0.90% | P 1.20%

Harry Hindsight

• EUR: A reasonably quiet range through the day with the market opening around the 1.0665 areas and heading steadily higher to the 1.0680 levels where the market held through to the London session, London were steady sellers with the market drifting lower into the NYK session and testing to the 1.0650 levels with steady PMI numbers from the European areas and the Rhetoric from Brexit yesterday’s news that’s if you discount Boris Johnson which isn’t so difficult. NYK took the market higher and again tested towards the highs before the US numbers were released, good US ISM numbers saw a quick return to the lows and some weak stops and the market spiked through to the 1.0640’s to set the low for the day, the market then spent the balance of the session moving steadily back towards the highs to finish the day only slightly higher than it started.
• GBP: Opening around the 1.2550 areas the market struggled to maintain the highs pushing only marginally higher before ranging around the 1.2540 areas through to the opening in London, early London quietly sold the Cable down to the 1.2500 areas with a brief move through the level to test the 1.2490 before starting a little rise into the NYK session, as with the Euro the market dipped on the US ISM numbers trading down to the 1.2470 area and holding the level through a few hours before rising to the 1.2485 levels into the close.
• JPY: The move through to the NYK session was a quiet affair with the Asian session selling early in Tokyo testing to the 111.10 levels before rising back to the opening levels and trading to its highs in early London testing the 111.60 level and then ranging through to the NYK session holding the 111.50-30 levels, The US numbers did little for the market, whether the first day of the fiscal year is to blame for the strengthening of the JPY or a safe haven play with Pres. Trump talking on North Korea the USDJPY dipped back into the 110 handle and held the 110.90 areas to the close.
• AUD: Opening around the 0.7635 areas the market tested to the 0.7640 levels into the Tokyo session before dropping back on poor retail sales numbers to push to the 0.7620 areas, the market then continued a steady drop through to the 76 cent areas with the market ranging through the London session generally holding the 76 cent the market dipped to the lows of the day during early London testing the 0.7590 areas but the move into the NYK session saw the market again basing off the 0.7600 areas, NYK tested towards the 0.7625 areas however, it was limited and the market again strayed to the 76 cent level to run along the level to the close.

Yesterday’s premiership results

JPY         Tankan Large Manufacturers Index Q1 A 12 | C 14 | P 10

JPY         Tankan Large Manufacturers Outlook Q1 A 11 | C 13 | P 8

JPY         Tankan Non-Manufacturing Index Q1 A 20 | C 19 | P 18

JPY         Tankan Non-Manufacturing Outlook Q1 A 16 | C 19 | P 16

JPY         Tankan Large All Industry Capex Q1 A 0.60% | C -0.30% | P 5.50%

JPY         Tankan Small Manufacturing Index Q1 A 5 | C 3 | P 1

JPY         Tankan Small Manufacturing Outlook Q1 A 0 | C 1 | P -4

JPY         Tankan Small Non- Manufacturing Index Q1 A 4 | C 2 | P 2

JPY         Tankan Small Non- Manufacturing Outlook Q1 A -1 | C -1 | P -2

JPY         PMI Manufacturing Mar (F) A 52.4 | C 52.6 | P 52.6

AUD       TD Securities Inflation M/M Mar A 0.10% | P -0.30%

AUD       Retail Sales M/M Feb A -0.10% | C 0.30% | P 0.40%

AUD       Building Approvals M/M Feb A 8.30% | C -1.50% | P 1.80%

CHF        Retail Sales (Real) Y/Y Feb A 0.60% | C -0.80% | P -1.40%

CHF        SVME PMI Mar A 58.6 | C 58 | P 57.8

EUR        Italy Manufacturing PMI Mar A 55.7 | C 55.1 | P 55

EUR        France Manufacturing PMI Mar (F) A 53.3 | C 53.4 | P 53.4

EUR        Germany Manufacturing PMI Mar (F) A 58.3 | C 58.3 | P 58.3

EUR        Eurozone Manufacturing PMI Mar (F) A 56.2 | C 56.2 | P 56.2

GBP        PMI Manufacturing Mar A 54.2 | C 55 | P 54.6 | R 54.5

EUR        Eurozone PPI M/M Feb A 0.00% | C 0.10% | P 0.70% | R 1.10%

EUR        Eurozone PPI Y/Y Feb A 4.50% | C 4.30% | P 3.50% | R 3.90%

EUR        Eurozone Unemployment Rate Feb A 9.50% | C 9.50% | P 9.60%

USD        ISM Manufacturing Mar A 57.2 | C 57.1 | P 57.7

USD        ISM Prices Paid Mar A 70.5 | C 66 | P 68

USD        Construction Spending M/M Feb A 0.80% | C 1.00% | P -1.00% | R -0.40%

Good Luck,

Andy

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