Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 110.834 | EURUSD 1.19468 | AUDUSD 0.80022 | NZDUSD 0.72936 | USDCAD 1.21966 | USDCHF 0.95958 | GBPUSD 1.35903 |

 

LMAX Ranges 6am London time

Highs    Lows

EURUSD               1.19551 | 1.19338

USDJPY                 111.254 | 111.00

GBPUSD               1.36031 | 1.35731

AUDUSD              0.80355 | 0.79951

USDCHF               0.96121 | 0.95945

USDCAD               1.22013 | 1.21719

NZDUSD               0.73442 | 0.72873

EURGBP               0.87969 | 0.8783

EURCHF                1.14809 | 1.14658

EURJPY                 132.927 | 132.599

For today

• EUR: A reasonably quiet day with the market opening a little weaker as the USD saw some strength from the pre-opening, trading from the 1.1930 level the market pushed through to the 1.1950 areas to fill the gap on the charts and trade around the 1.1940 levels with a limited run above the 1.1950 area before returning to the 1.1940 level for the run into the grey hour. Topside offers into the 1.1990 areas likely to continue through to the 1.2000 areas with limited stops on a move through and stronger offers likely to appear from the 1.2040 areas and increasing through to the years highs into the 1.2180-1.2200 areas, strong stops on a move through those highs and the market pushing into the next range through to the 1.2500 areas. Downside bids increasing into the 1.1900 areas with congestion around and through the figure areas with weak stops likely to be limited to a push through to the 1.1850 areas with stronger bids likely to appear in that area.
• GBP: USD a little stronger for the opening with Cable opening around the 1.3560 areas and then filling the gap in early trading to the 1.3590 level, the market then traded in a narrow 1.3580-1.3600 range through to the grey hour with the Japanese bank holiday limiting movement. Topside offers through into the 1.3620 areas with weak stops on a move through the level and sentimental levels likely to be the strong points. Downside bids light through to the 1.3250 areas with some limited congestion protecting the stronger 1.3200 level, with likely weak stops on a move through and into congestive bids with nothing other than sentimental levels until around the 1.3050 areas.
• JPY: Stronger USD from the opening saw the USDJPY start the day above the 111.00 levels and hold through into the bank holiday Tokyo session around the 111.20 areas into the grey hour with very little movement, Topside offers likely into the 111.50 areas with possible weak stops through the level and a quick test to the 111.80 areas and further offers continuing through the 112.00 areas from the end of July. Downside bids light through to the 110.00 areas with bids still building after the move back higher last week, a push through the level will likely see weak stops on a move back to the 109.50 areas and stronger congestion.
• AUD: Moving from the opening just below the 80 cent level the Oz saw quiet trading until deeper into the Tokyo bank holiday, testing from the narrow 0.7995-0.8005 range through to the 0.8035 level with mixed buying helping the market move higher to hold around the 0.8025 level into the grey hour, Topside offers into the 0.8040-60 areas and increasing from there into the 81 cent level with limited stops along the way, a push through the figure level is likely to see weak stops but limited with stronger offers likely to appear on any move towards the 0.8140-60 areas. Downside bids light through the 80 cent level with strong congestion likely to be a major factor through the 0.7950 level and possibly even further into the 79 cent areas where the bids are likely to be stronger.

Overnight News

GBP:

House price growth slowest since 2012 with London slumping

CNY:

China says will prevent risks from excessively rapid growth in overseas investments

USD:

Federal rate hike remains uncertain after Harvey, Irma

US warns N. Korea will be destroyed if threats continue

Trumps eldest son will testify publicly on Russia: senator

Trump pushes UN reform as world leaders gather for crisis talks

Today’s data

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

GBP       Rightmove House Prices M/M Sep A -1.20% | P -0.90%

09:00     EUR        Eurozone CPI M/M Aug C 0.30% | P -0.50%

09:00     EUR        Eurozone CPI Y/Y Aug (F) C 1.50% | P 1.30%

09:00     EUR        Eurozone CPI – Core Y/Y Aug (F) C 1.20% | P 1.20%

12:30     CAD       International Securities Transactions (CAD) Jul C 4.46B | P -0.92B

14:00     USD       NAHB Housing Market Index Sep C 67 | P 68

20:00     USD       Net Long-term TIC Flows Jul C 42.3B | P 34.4B

22:00     NZD       Westpac Consumer Confidence Q3 P 113.4

Weekend News

USD:

Disappointing IP reports Friday laid at the door of Hurricane Harvey

BIS: Bank of International Settlements discovers $14T of debt offshore hidden in footnotes Telegraph

US warns N. Korea must give up Nuclear weapons WSJ

Trump sets aside UN to find allies against N. Korea and Iran

JPY:

Abe weighs snap Japan election as Korea crisis boosts support

NZD:

Too close to call NZ election spooks Financial markets BBG

EUR:

Schaeuble says Euro gain reasonable

Schaeuble says the Eurozone much more stable

Spain’s Guindos commented on the speed of the Euro rise giving rise to concerns

ECB’s Praet says substantial stimulus is still needed

GBP:

Boris Johnson outburst challenges Theresa May’s Brexit leadership – FT

Harry Hindsight

• EUR: A quiet Asian session with the market moving around the 1.1910 levels through too deep into the London session the GBP move was the trigger for the Euro to start moving slowly higher stalling initially around the 1.1950 areas before moving into the NYK session and weaker retail sales and IP numbers helping the Euro to push into the resistance in front of the 1.2000 level, rejecting the area the market drifted to a close with end of London selling the market back through the 1.1950 level with some weak stops triggered on a move to the 1.1930 before holding quietly and rising to close around that 1.1950 level.
• GBP: Cable saw a quiet rise through to the grey hour moving off the 1.3380 level and pushing into the London session testing an old trend line around the 1.3450 levels a few hours into the London session BoE’s Vlieghe commented: increasing the odds of a 4Q hike with comments that led to the rise above the 1.3600, Vlieghe has been one of the most dovish members of the MPC and caught the market a little flat footed. The move was quick testing initially through the 1.3500 levels and then rising over the next couple of hours to test above the 1.3600 area making a high just short of the 1.3620 levels, the market then ranged through to the close in the 1.3580-1.3600 area, with limited movement on the US numbers.
• JPY: USDJPY opened around the 110.20 levels before dipping as the N. Korean’s fired another missile crossing over Japanese airspace again, USDJPY dropped quickly into the 109.50’s before quickly bouncing back to hold around the 110.00 level through into the Tokyo session, the move towards the grey hour saw the market again pushing through to the opening levels and a small round of weak stops triggered as the market tested to the 110.60 level, GBP movement saw the USDJPY taken to its highs as cross GBPJPY moved quickly and the USDJPY tested through the 111.00 level with very little trouble however, the long weekend for the Japanese, the move into the NYK session saw the market back below the level holding the 110.60 level and a quiet run through to the close around the 110.80 areas.
• AUD: Limited range through the day with the market opening around the 80 cent levels and drifting through to the 0.7985 areas and holding in that area through to the London session, movement in the GBP saw the market push through to the 0.8030 areas, the market held in a 15 pip range through to the NYK session with the high eventually pushed to the 0.8035 level before dropping quickly back to range around the 0.8000 areas through to the close.

 

Yesterday’s premiership results

NZD       Business NZ Manufacturing Index Aug A 57.9 | P 55.4 | R 55.5

EUR        Eurozone Trade Balance (EUR) Jul A 18.6B | C 22.1B | P 22.3B | R 21.7B

USD       Empire State Manufacturing Sep A 24.4 | C 18 | P 25.2

USD       Advance Retail Sales Aug A -0.20% | C 0.10% | P 0.60% | R 0.30%

USD       Retail Sales Less Autos Aug A 0.20% | C 0.50% | P 0.50% | R 0.40%

USD       Industrial Production Aug A -0.90% | C 0.10% | P 0.20% | R 0.40%

USD       Capacity Utilization Aug A 76.10% | C 76.80% | P 76.70% | R 76.90%

USD       U. of Michigan Confidence Sep (P) A 95.3 | C 95.6 | P 96.8

USD       Business Inventories Jul A 0.20% | C 0.20% | P 0.50%

Stay lucky

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.