Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 110.737 | EURUSD 1.06734 | AUDUSD 0.7564 | NZDUSD 0.69739 | USDCAD 1.34024 | USDCHF 1.00185 | GBPUSD 1.24397 |

LMAX Highs and Lows 5am GMT

                                High | Low

EURUSD               1.06857 | 1.06762

USDJPY                 110.882 | 110.675

GBPUSD               1.24424 | 1.24299

USDCHF               1.00181 | 1.0015

AUDUSD              0.75718 | 0.75652

USDCAD               1.34009 | 1.33958

NZDUSD               0.69795 | 0.6974

EURCHF                1.06996 | 1.06954

EURGBP               0.85911 | 0.85824

EURJPY                 118.385 | 118.229

For Today

EUR: A very quiet session with an initial push above the 1.0685 areas before drifting back to the 1.0675 areas and holding the level through to the grey hour, Topside offers into the 1.0700 areas likely to be light with congestion through the level and continuing through to the 1.0740-60 with likely stronger offers through the area and then increasing into the 1.0800 levels, downside bids light through to the stronger 1.0600 areas with congestion through the level, better bids into the 1.0550 areas and the market becoming a little tired in the current range.

GBP: Opening around the 1.2445 levels and apart from a dip into the Tokyo session to the 1.2430 levels the market has remained around the 1.2445 areas through to the grey hours, Topside offers light through to the 1.2490-1.2500 with some offers around the level and then stronger resistance through the level and into the 1.2550 areas, downside bids light through to the 1.2400 areas with the market seeing further support through to the 1.2350 before weakness appears.

JPY: The market traded quietly through to the Tokyo session around the opening 110.75 areas, Tokyo were early buyers through to the 110.90 areas before the market again ran into regional tensions and the market drifted back through the session to the 110.50 areas before holding into the grey hour, Topside offers into the 111.00 areas are likely to be light with weak stops on a move through the level with some congestion on a move through to the 111.50 areas and possibly some stronger stops opening a test to the 112.00 levels and a possible squeeze higher on a strong move through, Downside bids strong through from the 110.30 level and down into the 110.00 areas a push through the 109.80 areas is likely to see the potential for a larger move lower with sentimental bids through to the 1.0800 areas with better bids below the levels.

AUD: A very limited range through the day so far with the market holding above the opening levels for the bulk of the session trading around the 0.7570 areas before drifting towards the grey hours to test back to the opening levels around the 0.7565 area, Downside bids remain congestive with particular support through to the 0.7540 areas and again appearing around the 0.7520-0.7490 areas, a push through the level could see weak stops opening the downside to only sentimental levels on a move towards the 74 cent areas with limited bids through the area and the market opening for a deeper move. Topside offers through the 76 cent level likely to be light with increasing resistance on a move above the 0.7640 level with the offers thinning on a move through the 0.7660 areas only to increase on a test of the 77 cent level and through into heavy congestion.

Overnight News

KRW:

North Korea Fires Ballistic Missile Before Xi-Trump Meeting

JPY:

Japanese Premier Abe Slams North Korea’s Latest Missile Launch

JPY: Suga Says N. Korea Ballistic Missile Fell outside Japan’s EEZ

JPY: Japan’s Output Gap Positive for 1st Time Since 1Q of 2015: BOJ

JPY/USD:

Japan Welcomes U.S. Keeping All Options Open on N. Korea: Suga

USD:

Meadows Says ‘No Agreements’ on Health-Care Path after Meeting

U.S. Pacific Command Comments on North Korea Missile Launch

EUR:

Melenchon Seen Most Convincing in French TV Debate: Elabe

CNY:

PBOC Calls for Macro Prudential Management Against Risks: Study Times

AUD:

Australia March Services Index Rises 2.7 Pts M/m to 51.7

GBP:

U.K. March BRC Shop Price Index -0.8% Y/y vs Feb. -1% Y/y

NZD:

New Zealand Household Lending Growth Slowed in February: RBNZ

Auckland Average House Price Rises at Slower Pace: Barfoot

Today’s data

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

GBP       BRC Shop Price Index Y/Y Mar A -0.80% | P -1.00%

07:45     EUR Italy Services PMI Mar C 54.3 | P 54.1

07:50     EUR France Services PMI Mar (F) C 58.5 | P 58.5

07:55     EUR Germany Services PMI Mar (F) C 55.6 | P 55.6

08:00     EUR Eurozone Services PMI Mar (F) C 56.5 | P 56.5

08:30     GBP Services PMI Mar C 53.5 | P 53.3

12:15     USD ADP Employment Change Mar C 189K | P 298K

14:00     USD ISM Non-Manufacturing Composite Mar C 57 | P 57.6

14:30     USD Crude Oil Inventories P 0.9M

18:00     USD FOMC Meeting Minutes

Harry Hindsight

• EUR: Asia was quiet with the Euro trading around the opening 1.0670 areas and then dipping on the opening in London and pushing slowly down through the 1.0650 levels before holding quietly through into the mid-morning, the market again took a run lower this time trading to the 1.0635 areas before starting a slow rise back through into the NYK session eventually setting a high just above the 1.0675 level in a limited range.
• GBP: Cable moved a little higher through from the opening with the market testing the 1.2495 levels through into the late part of the session, what I can only assume was a large single ticket moving through the market Cable dropped back quickly into the London session testing the 1.2420 levels before ranging around the 1.2430 areas to the only data of the day with a weaker construction PMI believed by some to be responsible for the move however, given the fickle weather during the month any decline could be assumed to be wet weather and remains in expanding mode, the market ranged from the numbers around the 1.2440 levels briefly attempting the 1.2465 areas and unable to push down through the 1.2420 lows.
• JPY: Opening around the 110.90 levels the market slipped slowly lower through the Asian session with the market testing to the 110.50 areas initially, whether part of the new financial year or strangely safe haven flows given tensions in the region, the market drifted to the 110.35 levels with the market ranging through into the London session around the 110.45 levels, the move into the NYK session saw the market initially dip before a slightly better trade balance saw the market move off the lows trading steadily back to the 110.70 areas before pausing and then ranging through to the close around the 110.75 area.
• AUD: A better trade balance had little effect on the market with the Oz moving off the early 0.7590 lows to test back through the 0.7605 to test to the 0.7615 highs, the move through to the London session was a steady drift back towards the 76 cent level and then London were quick sellers and the market pushed to the 0.7585 areas and a quiet drift from there through to the NYK session testing through the 0.7550 areas, the rest of the session was a slow climb through to the close around the 0.7565 level.

Yesterday’s premiership results

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%

GBP       Construction PMI Mar A 52.2 | C 52.5 | P 52.5

EUR        Eurozone Retail Sales M/M Feb A 0.70% | C 0.50% | P -0.10% | R 0.10%

CAD       International Merchandise Trade (CAD) Feb A -1.0B | C 0.7B | P 0.8B | R -0.4B

USD       Trade Balance Feb A -43.6B | C -46.0B | P -48.5B | -48.2B

USD       Factory Orders Feb A 1.00% | C 0.90% | P 1.20%

Good Luck,

Andy

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