Daily FX Market Commentary

Andy Harrison

Good morning,

LMAX Close

USDJPY 106.883 | EURUSD 1.22955 | AUDUSD 0.78403 | NZDUSD 0.72941 | USDCAD 1.26315 | USDCHF 0.93623 | GBPUSD 1.39709 |

 

LMAX Ranges 6am London time

Highs    Lows

EURUSD               1.23294 | 1.22802

USDJPY                 107.208 | 106.437

GBPUSD               1.40193 | 1.39641

AUDUSD              0.78790 | 0.78292

USDCHF               0.93774 | 0.93346

USDCAD               1.26607 | 1.26185

NZDUSD               0.73371 | 0.72768

EURGBP               0.88001 | 0.87885

EURCHF                1.15185 | 1.14968

EURJPY                 131.679 | 131.111

For today

• EUR: Early trading saw the market slip from an unchanged opening and falling back in limited selling to the 1.2280 areas before finding some buying moving into the market and a slow rise through the next couple of hours pushing the 1.2320 level, further tests higher appeared late in the market on a push towards the grey hour testing through to the 1.2327 level. Topside light offers through the 1.2340 level with a mix of weak stops and further congestion into the 1.2360 levels, offers then reappear in strength through the 1.2380-1.2400 levels with congestion then continuing through to the 1.2420-30 level before opening to limited offers around the 1.2450 areas and building in size the closer you get to the 1.2500 areas. Downside bids light into the 1.2280 level with weak stops through the level and limited congestion continuing through to the 1.2250 level and limited bids then through to the 1.2220-00 level and stops quickly appearing on a push through the 1.2180 area, limited data for the day would suggest a quieter session overall
• GBP: USD selling was non-existent until deeper into the Tokyo session with the market initially holding around the opening 1.3970 level and then steadily pushing through to the 1.4000 level drifting for a couple hours around the figure area before starting a slow climb into the grey hours testing the 1.4020 level. Topside sees light offers continuing through to the 1.4050 areas with congestion all but disappearing on a push through the level and the market then open to a test of the 1.4100 levels with stronger offers then appearing from the 1.4100 level through to the 1.4115 areas, weak stops on a test through this level meeting some light congestion all the way through to the 1.4200 level which is likely to see stronger offers reappearing in the area but with weak stops on any break above the level, once through the market is still likely to see only light congestion through to the stronger 1.4250-1.4300 areas. Downside bids light through the 1.3900 level with some congestion around that area and limited stops on a move through with congestive bids likely to continue through to the 1.3850 areas before increasing in size through to the 1.3800 level.
  JPY: Pre-market saw the USDJPY rushing to the 107.15 level in a push for stops the market believes however, when the market officially opened it was just off those levels around the 107.05 areas and steadily moved through to the 107.15 areas again, talk of the hourly cloud top just above this area attracted the attention however, the market failed the level and moved into the Tokyo session slipping lower steadily to push below the 106.50 areas with possible early buyers cutting those positions on the failure and USD unsupported through the session, the market did see limited buying but those 106.70 areas were short lived as the market moved to the 106.50 areas into the grey hours, Topside offers weak through to the 107.20 areas where there appears to be some stronger offers from real money a push through the 107.25-30 level will likely see weak stops appearing and the market then quickly rising into the congested 107.50 areas with stronger offers from there the higher you go towards the 108.00 levels, Downside bids light through to the 106.00 level with decent bids likely to be in the area and running through to the 105.50 level and particular strong however, a break here will likely see stronger stops appearing and the market then open on a break through the 105.00 areas to larger dips with limited congestion through 104.80 and then 104.50.
  AUD: Oz saw a better range than the whole of Friday through the Asian session, from the opening around the 0.7835 areas the market slipped from early highs around 0.7845 to the 0.7830 level before starting a rise through to the 0.7865 areas before seeing some limited relief, the move through to the grey hours saw a secondary move and the market testing into the grey hours pushing lightly through the 0.7880 levels with slightly better volumes than we saw last week for the sessions. Topside offers into the 0.7900 cent level and increasing offers through to the 0.7930 levels with weak stops on a move through the level and then limited congestion through to the 0.7960 level, from that point through stronger offers are likely to increase on any move to test the 80 cent areas with congestion through to the 0.8030 levels before any chance of stops appearing, Downside bids light through to the 78 cent areas with bids likely to increase on a move through the level and into the 0.7750 level, with stops then waiting below the level and leaving the 77 cent level vulnerable to a test.

Overnight News

CNY:

China trying to enforce claim to South China sea : Trump advisor

PBoC head from Zhu Rongji Mold will be warmly welcomed

China’s Xi follows Putin in laying ground to rule for decades

TPP:

Revised TPP faces obstacles on road to ratification

AUD:

Rising chorus demanding that APRA loosen their rules for mortgage lending in the face of slipping prices

Today’s data

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

09:30     GBP       BBA Loans for House Purchase Jan C 37.2K | P 36.1K

15:00     USD       New Home Sales Jan C 646K | P 625K

Weekend News

USD:

FED report signals no worries about recent market volatility

FED’s crisis era, bond buying plan was largely ineffective economists say

Trump public works plan gets nudge from $2T pension pool

Trump is said to favour stiffest US steel, aluminium tariffs

FED’s Williams says 3 to 4 rate hikes this year makes sense

CNY:

Three Chinese insurers found to have violated investment rules

EUR;

Italy’s Berlusconi looks set to return as Kingmaker after years in Political limbo

JPY:

Pre market saw USDJPY print to the 107.14 level in thin markets

Harry Hindsight

• EUR: Slowly weaker through the Asian session for the Euro however, having opened around the 1.2330 areas pushing towards the 1.2340 level before moving into the Tokyo session and slowly slipping lower through the Asian session to test into the grey hours testing to the lows, the market moved off the 1.2280 level, early London were quick buyers from the low and the market moved through the official opening testing to the 1.2320 levels before stopping and holding through to the Euro numbers, no change on the CPI numbers saw the market dipping back to the 1.2290 levels and the market based along the line through to the close with occasional sojourns above the 1.2310 level and narrowing down through to the close.
• GBP: A quiet Asian session with the market holding around the 1.3950 levels and trading a few times to the opening 1.3960 area but very little movement with the lows appearing into the end of the Tokyo session and limited selling on a test through to the 1.3925 level before moving into the London session fully and rising quickly through to the 1.3995 areas with some limited hope for trade negotiations, holding around the 1.3975 areas the knockback by the EU came quickly and the market dipped quickly to the 1.3905 levels before bouncing back and heading into the NYK session and testing to the 1.4000 level, the market was unable to push cleanly through the level and continued trying to breach the level through to the London close before dropping back and holding around the 1.3975 areas through to the close.
• JPY: USDJPY saw the market dipping a little before moving into the Tokyo session and the market rising through to the 107.00 levels before falling away again, the market again started to rally pushing through to the grey hours again testing the 107.00 levels, early London took the market through towards the 107.15 level however, that was the high for the day as once London officially opened the market dipped back to hold for several hours in the 106.80-90 range, the move into the NYK session saw the market dipping through to the 106.70 levels rebounding a little before slipping through towards the 106.50 areas before holding quietly around the 106.60 levels, late trading saw the market rise back through the opening levels to finish just short of the 106.90 levels with limited volume.
• AUD: A very limited day for the Oz with the market drifting lower through into the London session with the market opening around the 0.7845 areas and falling back to the 0.7814 area into the grey hours, limited trading through London saw the market extend its lows a little to the 0.7810 areas before moving into the NYK session and starting a recovery in the same manner that it drifted off with the market moving slowly into the 0.7840 areas to close just short of the opening.

Yesterday’s premiership results

NZD       Retail Sales Ex Inflation Q/Q Q4 A 1.70% | C 1.30% | P 0.20% | R 0.30%

JPY         National CPI Core Y/Y Jan A 0.90% | C 0.80% | P 0.90%

JPY         Corporate Service Price Y/Y Jan A 0.70% | C 0.80% | P 0.80%

EUR        German GDP Q/Q Q4 (F) A 0.60% | C 0.60% | P 0.60%

EUR        Eurozone CPI M/M Jan A -0.90% | C -0.90% | P 0.40%

EUR        Eurozone CPI Y/Y Jan (F) A 1.30% | C 1.30% | P 1.40%

EUR        Eurozone CPI Core Y/Y Jan (F) A 1.00% | C 1.00% | P 1.00%

CAD       CPI M/M Jan A 0.70% | C 0.50% | P -0.40%

CAD       CPI Y/Y Jan A 1.70% | C 1.50% | P 1.90%

CAD       CPI Core – Common Y/Y Jan A 1.80% | P 1.60%

CAD       CPI Core – Median Y/Y Jan A 1.90% | P 1.90%

CAD       CPI Core – Trim Y/Y Jan A 1.80% | P 1.90%

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.