Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 111.267 | EURUSD 1.12076 | AUDUSD 0.74571 | NZDUSD 0.69261 | USDCAD 1.35108 | USDCHF 0.97285 | GBPUSD 1.30364 |

 

LMAX Ranges 6am London time

Highs    Lows

EURUSD               1.12099 | 1.11826

USDJPY                 111.608 | 111.149

GBPUSD               1.30257 | 1.29736

AUDUSD              0.74580 | 0.74353

USDCHF               0.97469 | 0.97257

USDCAD               1.35410 | 1.3510

NZDUSD               0.69396 | 0.69221

EURGBP               0.86236 | 0.86048

EURCHF                1.09072 | 1.08996

EURJPY                 124.887 | 124.558

For today

• EUR: A quiet session through Asia with the market moving into the Tokyo session drifting from the 1.1210 levels to push through the figure and trading through the balance of the session around the 1.1190 levels with minor dips into the 1.1185 area. Topside offers through the 1.1240-60 sentimental level with stronger offers picking up on a move through the 1.1280 areas and into the 1.1300 levels weak stops on a move through the level will likely see a continuation of a steady grind to the stronger 1.1400 areas, Downside bids light through to the 1.1100 areas with some sentimental bids in the area before stronger stops appear on a move through the 1.1080 areas with congestion through to the 1.1000 and the market looking for economic direction or ECB.
• GBP: Cable opened a little lower after Brexit news at the weekend, the market attempted to close the gap on the charts however, it was unable to move to far above the 1.3020 areas, with the market moving into the Tokyo session dipping through to test just beyond the 1.2980 level before recovering after the lows with the market holding above the 1.3000 as the market moves into the grey hour. Topside offers still remain into the 1.3050 levels with the market then finding light congestion over the next few big figures with the market then looking at the 1.3400 level,
• JPY: Opening around the 111.10 levels the market moved through the early pre Tokyo session filling a small gap on the charts. Tokyo saw strong USDJPY buying through the early part of the session however, it was unable to push to far through the 111.60 level and ranged around the 111.50 levels through to the grey hour, offers into the current levels with possible weak stops on a push through the 111.80 areas however, these are likely to be absorbed by limited sentimental offers and the market seeing offers into the 112.00 levels light with stronger stops on a move through the 112.20 levels likely for a move through to lighter offers on the way to the vulnerable 113.00 levels. Downside bids into light congestion around the 111.00 areas with stronger bids are likely to appear into the 110.50 area, a move through sees stronger bids into the sentimental level of 110.00 areas with stops likely to be strong on a move through the level leaving the downside vulnerable.
• AUD: Oz opened weaker with the market moving off the levels below the 0.7450 to fill the gap on the chart to trade towards the 0.7460 level before slowly slipping lower into the Tokyo session and test to the 0.7435 levels and trading quietly around the 0.7445 areas, Offers into the 0.7470 areas and likely to continue through to the 75 cent levels with congestion around the level and possibly limited in range with weak stops through the 0.7530 areas if it can make it however, the congestion will continue through to the 0.7540-60 stronger offers. Downside bids light through to the 74 cent levels with slightly stronger bids in the area however, a push through the figure area will likely see stronger bids appearing on any attempt of the 0.7350 level.

Overnight News                                                                  

CNY:

China’s Yuan weakens against USD, hits low against currency basket

GBP:

London house prices recover as sellers shrug off election

JPY:

April exports rise 7.5% YoY MoF

AUD:

S&P reaffirms credit ratings on the four major banks

Today’s data

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

GBP       Rightmove House Prices M/M May A 1.20% | P 1.10%

JPY         Trade Balance (JPY) Apr A 0.10T | C 0.25T | P 0.17T | R 0.11T

13:00     CNY        Conference Board Leading Index Apr P 0.90%

14:00     USD       Fed’s Harker Speaks in New York

14:30     USD       Fed’s Kashkari Speaks

Weekend News

USD:

Comey agrees to Testify as Trumps Russia crisis increases

Russia probe reaches current White House Official, People familiar with the case say

Trump attacks Iran in good and evil speech

US to sign $110B of military contracts as part of memorandum of intent to support Saudi defence

KRW:

North Korea tests another missile in latest provocation by Kim

UN security council to meet Tuesday on N.Koreas Missile test

GBP:

UK threatens to quit Brexit talks if it faces massive bill

EUR:

Greece’s bailout review stalls as creditor’s debate debt relief

Italy and France to discuss more integrated EU, migration crisis dinner

France and Germany in dispute over where EU’s top financial regulator should be.

TRY:

Turkey’s Erdogen vows fight against enemies as returns to lead party

Harry Hindsight

• EUR: The market moved quietly through the Asian session with market moving off the lows around the 1.1100 areas and trading around the 1.1110 level into the London session, rising PPI numbers out of Germany and more pressure building for a rate rise in Europe or an end to QE, the move through the London session saw the market steadily push through the 1.1150 areas with little problem and held the 1.1160 areas into the NYK session, with the market continuing to push to just below the 1.1200 levels before struggling through to the London close, late in the session the market pushed through to the 1.1210 triggering some weak stops along the way however, the market was unable to push through the level and closed just off the highs. Less chatter today however, what there was saw Coeure having doubts about allowing inflation overshooting the 2% level.
• GBP: Cable rose from the 1.2930 levels through into the Tokyo session pushing above the 1.2950 areas and trading in a tight range through to the London session, CBI numbers showed a strong improvement and the market tested steadily through to the 1.3020 areas and holding in close proximity to the level through into the NYK session, the Euro move over the Cable found itself playing catch up however, it was very slow going with the market slowly rising to the 1.3030 eventually testing the 1.3040 as it ground slowly through the levels. A general USD weakness for the most part, with pressure over the Trump allegations causing concerns.
• JPY: With USD under pressure the JPY found its on level and any dip in the USDJPY was quickly absorbed and turned slowly higher again, Opening around the 111.60 level the market traded around that level through the day and while the dips were deeper than the rises the market always found bidders into the 111.00 areas, with the market testing down during Tokyo initially and then rising for the London opening and pushing through to the 111.70 level to make the highs, the move through into the NYK session again saw the market trading again to make the lows, again the market tested back higher towards the top of the range before slipping slowly lower into the close.
• AUD: Oz like the other currencies saw the market slowly rise through the session trading quietly into the Tokyo session and eventually test through to the 0.7425 levels from the 0.7405 areas, the move through into the London session saw a quick move to the 0.7440 levels before pausing and then moving quickly again to test the 0.7470 areas in a spike higher with strong EURAUD buying pulling the AUD higher and triggering some weak stops on the move through the 0.7460 level, the move through the rest of the session saw the market struggling slowly through to the 0.7465 areas before drifting into a close just short of those highs.

Yesterday’s premiership results

EUR        German PPI M/M Apr A 0.40% | C 0.20% | P 0.00%

EUR        German PPI Y/Y Apr A 3.40% | C 3.20% | P 3.10%

EUR        Eurozone Current Account (EUR) Mar A 34.1B | C 32.3B | P 37.9B | R 37.8B

GBP       CBI Trends Total Orders May A 9 | C 4 | P 4

CAD       Retail Sales M/M Mar A 0.70% | C 0.30% | P -0.60% | R -0.40%

CAD       Retail Sales Less Autos M/M Mar A -0.20% | C 0.20% | P -0.10%

CAD       CPI M/M Apr A 0.40% | C 0.50% | P 0.20%

CAD       CPI Y/Y Apr A 1.60% | C 1.70% | P 1.60%

CAD       CPI Core – Common Y/Y Apr A 1.30% | C 1.40% | P 1.30%

CAD       CPI Core – Trim Y/Y Apr A 1.30% | P 1.40%

CAD       CPI Core – Median Y/Y Apr A 1.60% | P 1.70%

EUR        Eurozone Consumer Confidence May (A) A -3 | C -3 | P -4

Stay lucky

Andy

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