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Daily FX Market Commentary

Good morning,

 

LMAX Close

USDJPY 112.291 | EURUSD 1.17957 | AUDUSD 0.75637 | NZDUSD 0.68719 | USDCAD 1.27878 | USDCHF 0.98987 | GBPUSD 1.33924 |

 

LMAX Highs and Lows 6am GMT

                                High | Low

EURUSD               1.18090 | 1.17893

USDJPY                 112.540 | 112.217

GBPUSD               1.33992 | 1.33641

USDCHF               0.99074 | 0.98737

AUDUSD              0.75696 | 0.75418

USDCAD               1.28095 | 1.27866

NZDUSD               0.68883 | 0.68499

EURCHF                1.16895 | 1.16569

EURGBP               0.88241 | 0.88051

EURJPY                 132.741 | 132.451

 

For today

  • EUR: A very limited range for the Euro with the market moving around the 1.1800 areas throughout the session with the market making early efforts to the topside to test towards the 1.1810 areas making the push to that level twice before drifting back into the grey hours to make the lows around the 1.1790 level, Topside offers through into the 1.1840-60 areas likely to slow the market with congestion likely to continue through to the 1.1880 areas before the market weakens a little and free to move through the 1.1900 with limited impedance, through to the 1.1940 levels is likely to be weak but from there the market increases in offers with the market likely to see weak stops on a move above the 1.1960 areas and the market running into possibly stronger offers including option interest. Downside bids light through to the 1.1750 level with some congestive bids likely to run through the level and into the possibly weak 1.1700 areas, a test through the level will see stops appearing as the market opens to a deeper move with 1.1660 likely to be a key level for the short term.
  • GBP: Dipping from the opening highs the Cable moved into the Tokyo session some 15 pips adrift and broadly held the 1.3380 areas through deep into the session finally pushing through the level in the last hour before the grey hours testing to the 1.3365 level and close to yesterday’s lows, Topside offers light back through the 1.3400 levels with possibly weak stops just beyond the level the market is likely to be slightly congestive with a push through the 1.3440 areas opening a return to the 1.3500 levels with stronger offers through the level and into the 1.3550 key to any further gains. Downside bids into the 1.3350 areas the strongest point for the moment with a push through the level likely to open up a quick move through to the 1.3200 areas where stronger support is likely
  • JPY: A move higher from the opening with the market pushing from the opening lows around the 112.20 areas to test into the first hour of Tokyo to the 112.50 level, the market held deep through towards the grey hours before making a move above the 112.50 area, Topside offers light through to the 113.00 areas with stronger offers likely to appear on a move through to the 113.20 area with congestion continuing through to 113.50 were short term players are likely to be offering, towards the 113.80-114.00 areas the market is likely to increase with a move through facing further congestion and not really opening until well beyond the 114.60 level and ranges not seen since the beginning of the year, Downside bids light through the 112.00 areas with weak stops just beyond with better bids then moving in around the 111.50 level with congestive bids continuing through to 111.00 even here though the market is likely to be limited and not until the market presses towards the 110.55 area are we likely to see stronger bids.
  • AUD: As with yesterday the Oz was generally quiet apart from another disappointing set of data, opening around the 0.7565 levels the market made it into the Tokyo session pushing slightly higher before the release of the Trade balance numbers which looked extremely weak and even last month’s number was revised lower, testing through into the low 0.7540’s and then basing quietly through to the grey hours barely moving. Downside bids into the 0.7530 levels with a push through the level likely to see weak stops appearing and then bids into the 75 cent level with some congestion mixed with weak stops on a move through the level, with 74 cent opening for the market, Topside offers back through the 76 cent levels with some limited weakness on a push through to the 0.7640 level however, from that point onwards the market is likely to see stronger offers moving into the market for the move to the 77 cent level and continuing through to the 0.7730 areas before weak stops appear.

 

Overnight News                                                                  

NZD:

NZ house price inflation picks up for first time since January

Rises 6.4% from 3.9% in October

CAD:

BoC reiterates caution in holding rates steady

GBP:

UK’s Davis allies are said to launch bid to replace PM May – The Sun

EU’s Juncker fears Theresa May’s Government will collapse next week – UKT

Tory MP’s urge PM May to ignore highly irresponsible colleagues pushing for no deal – Independent

CNY:

China’s growth will be much, much lower, when debt comes under control – CNBC

JPY:

BoJ Chief says current policy framework is sustainable

 

Today’s data

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

AUD       Trade Balance Oct A 0.11B | C 1.41B | P 1.75B | R 1.60B

JPY         Leading Index CI Oct (P) A 106.10 | C 106.1 | P 106.4

06:45     CHF        Unemployment Rate Nov C 3.10% | P 3.00%

07:00     EUR        German Industrial Production M/M Oct C 1.00% | P -1.60%

08:00     CHF        Foreign Currency Reserves (CHF) Nov C 745B | P 742B

10:00     EUR        Eurozone GDP Q/Q Q3 (F) C 0.60% | P 0.60%

12:30     USD       Challenger Job Cuts Y/Y Nov P -3.00%

13:30     CAD       Building Permits M/M Oct P 3.80%

13:30     USD       Initial Jobless Claims (DEC 02) C 241K | P 238K

15:00     CAD       Ivey PMI Nov P 63.8

15:30     USD       Natural Gas Storage P -33B

 

Harry Hindsight

  • EUR: Early trading was limited somewhat with the market moving a touch higher to the 1.1830 areas before dropping back through towards the 1.1815 levels before bouncing back again to the opening levels, Euro rallied a little as the market moved towards the Tokyo lunch pushing through to the 1.1845 levels with some light stops helping it along the way before holding through to the London session, London were light sellers back to that 1.1815 level but the market held through towards the NYK session before slowly slipping lower into the NYK session, drifting through to the 1.1800 levels with difficulty and testing through to the 1.1780 areas before starting a steady rise through to just below the figure level.
  • GBP: The market opened on its highs around the 1.3440 levels and slipped into the Tokyo session trading around the 1.3410 level, the market started to recover with GBPAUD cross buying helping to move it back towards the opening levels before drifting through the session into the grey hours holding the 1.3420 area. Early London through the grey hours saw the market dip for the first time through the 1.3400 levels to test the 1.3390 area for a few hours before starting a slow decline through to the 1.3360 levels where the market based deep into the NYK session before lifting towards the 1.3400 levels to the close.
  • JPY: Rumours that the BoJ has quietly stopped the easing policy was enough to see the USDJPY drifting through the Asian session with the market opening around its highs in the 112.60 trading into the Tokyo session around the 112.40 before pushing through to 112.20 and another step lower into the grey hour to test the 112.00 levels, while the market did recover a little the opening in London around the lows saw the market take the rest of the day pushing through to the 112.40 areas before drifting for several more hours around the 112.30 to the close.
  • AUD: The Oz was all about the GDP figures and while on the face of it there was a decline of 0.10% on the headline number this was balanced somewhat on the revision higher for last month, the move to the number saw the market rally sharply on limited liquidity testing through the 0.7630 levels in small amounts and likely caused initially on a single ticket in the market pushing through to the 0.7616 areas however, the market continued in those few seconds before dropping back quickly as the number was seen, the market dropped down to the 0.7572 level before finding sufficient bids in the market to turn the market and apart from the shouting that was it for the day and the market traded through Asia around the 0.7580 level, the market moved through the London session attempting to push back to the 76 cent areas but couldn’t manage it and as the market moved into the NYK session the market lost ground again testing through to the 0.7560 and holding quietly through to the end of the day in that area.

 

Yesterday’s premiership results

AUD       GDP Q/Q Q3 A 0.60% | C 0.70% | P 0.80% | R 0.90%

EUR        German Factory Orders M/M Oct A 0.50% | C -0.20% | P 1.00%| R 1.20%

CHF        CPI M/M Nov A -0.10% | C 0.00% | P 0.10%

CHF        CPI Y/Y Nov A 0.80% | C 0.80% | P 0.70%

EUR        Eurozone Retail PMI Nov A 52.4 | P 51.1

USD       ADP Employment Change Nov A 190K | C 191K | P 235K

CAD       Labour Productivity Q/Q Q3 A -0.60% | C -0.40% | P -0.10% | R -0.20%

USD       Nonfarm Productivity Q3 (F) A 3.00% | C 3.30% | P 3.00%

USD       Unit Labour Costs Q3 (F) A -0.20% | C 0.30% | P 0.50%

CAD       BoC Rate Decision A 1.00% | C 1.00% | P 1.00%

USD       Crude Oil Inventories A -5.6M | C -3.2M | P -3.4M

               

 

Good Luck,

Andy

 

 

 

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