Daily FX Market Commentary

Good morning,

LMAX Close

USDJPY 109.379 | EURUSD 1.19409 | AUDUSD 0.75412 | NZDUSD 0.69643 | USDCAD 1.27957 | USDCHF 1.0004 | GBPUSD 1.35411 |

 

LMAX Ranges 5am GMT

Highs    Lows

EURUSD               1.19686 | 1.19427

USDJPY                 109.409 | 109.209

GBPUSD               1.35749 | 1.35422

AUDUSD              0.75650 | 0.75423

USDCHF               1.00074 | 0.99882

USDCAD               1.27934 | 1.27704

NZDUSD               0.69745 | 0.69587

EURGBP               0.88231 | 0.88152

EURCHF                1.19577 | 1.19479

EURJPY                 130.842 | 130.588

For today

• EUR: A slow steady climb through the session to test the highs from Friday saw the limited movement then stalling and drifting into the grey hour around the 1.1960 area, light offers through to the 1.2000 area where the market is likely to be a little stronger with some congestion running to the 1.2020 areas with weak stops likely to be through the level and weakness until through the 1.2050 areas and stronger offers likely to reappear, a push to the 1.2100 level is likely to continue to be defended and only a strong break through the 1.2120 is likely to clear the topside for further testing. Downside bids light back into the 1.1900 level before the market opens a little however, the downside is likely to see stronger bids appearing on any test through the 1.1880 level and increasing the closer the market gets to the 1.1840 level.
• GBP: Opening just above the closing level saw the market slip back to fill the small gap and make the lows around the 1.3540 areas before slowly rising through to test the 1.3575 areas into the mid-session, the market then hung around the level repeatedly testing the level before slipping slowly back to the 1.3565 areas into the grey hour, Downside strength into the 1.3500 areas and has shown notable support through the past weak or so, a push through to test the 1.3450 level could see stronger stops appearing and the market opening, topside offers through the 1.3600 level have also been resistance over the same period as the downside support however the topside stops are likely to be just through the 1.3620 level and closer for any test through, a push through to the 1.3650 area could see stronger bids appearing and the market running through to a weaker 1.3700 level.
• JPY: USDJPY in a very narrow range with the market opening around the closing level and testing to the 109.40 areas before dropping back into the Tokyo session to test towards the 109.20 level holding quietly then rising slowly through to the grey hour pushing towards the highs for the move into the grey hour, downside bids dependent on the yield players and a push through to the 108.50 area is likely to see stops appearing and the market breaking quickly to test to the 108.00 level, maybe a breath before pushing aside that level with congestion likely not to appear until closer to the 107.50 level and stronger bids likely to appear. Topside offers through to the 110.00 level with the topside showing resistance all the way through but increasing into the figure, a break through the 110.20 areas will likely see stops appearing and the market quickly challenging the 110.50 level.
• AUD: Slipping from the opening to the 0.7535 areas before slowly rising through the session to push eventually to the 0.7565 areas before running out of steam, the market then drifted through the session but generally held through to the grey hour around the 0.7555. Topside offers into the 76 cent area will likely see weak congestion through the level and then stops on a break through the 0.7620 areas opening through to the 0.7660 areas before starting to meet anything meaningful, congestion then into the stronger 77 cent levels and likely to be a little deeper with offers then increasing into the 0.7740 areas, downside bids light through the 75 cent level however, the congestion then is likely to increase with possible weak stops in the mix the market continues to see stronger bids on a move through to the 0.7420 level providing a base for the market.

Overnight News

CNY:

China Three Gorges bids $10.9B for rest of Portugal’s EDP

China’s online lenders reel from government clampdown

USD:

Trump’s betrayal of Iran deal brings USD/CNY trade war so much scarier

EUR:

Italy’s 5 star, League reach deal on Government program

France wants UK/Irish border dispute settled by June

NZD:

New Zealand population growth rate slows to 3 year low of 1.98%

NZ services industry expanded at slower pace in March

GBP:

UK shoppers continue to tighten purse strings, Visa

Today’s data

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

23:50     JPY         Domestic CGPI Y/Y Apr A 2.00% | C 2.00% | P 2.10%

06:00     JPY         Machine Tool Orders Y/Y Apr (P) P 28.10%

 

Weekend News

USD:

Trump says he and Xi are working to bring back China’s banned ZTE

US demands hard stop on N. Korea nukes before benefits can flow

Trump seeks joint statement with Kim to lock in gains

Trump say’s wants a government funding deal before August break

US retreat from trade deals poses a new threat to USD WSJ

Lighthizer: US to keep working with Canada, Mexico on NAFTA

GBP:

Trust me on Brexit says May as minister squabble

AUD:

Turnbull government loses ground to Labour in budget battle

NOK:

Norway CB Governor writes in OP-ED: Outlook shows it will soon be right to hike rates

Harry Hindsight

• EUR: A slow Asian session saw the market trading the 1.1910-20 range through to the grey hour where the market dipped slightly through the low and recovered into the London opening, early sellers saw a gentle dip through to the 1.1890 areas before starting a slow rise through to the 1.1920 level and a brief pause pushed quickly to the 1.1930 levels and then a slower push to the 1.1950 area, the move into the NYK session saw a lower than expected import price for the month and the market dipping a little to the 1.1930 level and the market again started to rally and pushing through to the 1.1970 areas before running out of steam and a slow drift to the close.
• GBP: A little more lively than the Euro however, the result was similar with the Cable rising from the opening around the 1.3515 areas and holding through into the Tokyo session rising slowly deeper into the session to test the 1.13535 area and the high in Asia done the market held around the 1.3530 through into the grey hour, London opening saw the market falling through to its lows and testing to the 1.3505 as early traders pushed towards the figure level however, as with the Euro the market moved off the lows and settled into a steady rise through to the 1.3540 levels however, the market eventually pushed through the level and into the 1.3550 area and some weak stops helped the market testing to the 1.3580 in a crisper manner before holding through to the NYK session, spiking through to test the 1.3595 level before sliding off through to the close in London and holding the 1.3550 level and starting a slow move through to the close just below the level.
• JPY: Overall a slow choppy day for the USDJPY but well contained within a 35 pip range, the market opened around the 109.55 areas and traded slowly lower through the day but finishing only slightly off the opening level, early trading saw buying into the Tokyo session before dropping back after the Tokyo fix to test quickly to the 109.20 level before spending the rest of Asia recovering to the 109.50 level for the move into London session and the sellers reappearing, the market pushed through into the NYK session pushing lightly through to the 109.16 level before bouncing around on the London close and running to the close rising just a little.
• AUD: Overall a very quiet day for the Oz, the market opened around the 0.7535 areas and then slipped to just below the 0.7530 areas and holding for the bulk of Asia on that line before rising into the grey hour to test the highs and a move into London unchanged for the most part, EARLY London tested through to the 0.7545 area and after a couple of hours testing the level broke slowly through to test towards the 0.7560 level before slipping back to finish the day in the mid-range for the day.

Yesterday’s premiership results

22:30     NZD       Business NZ Manufacturing PMI Apr A 58.9 | P 52.2 | R 53.1

23:50     JPY         Japan Money Stock M2+CD Y/Y Apr A 3.30% | C 3.20% | P 3.20% | R 3.10%

01:30     AUD       Home Loans M/M Mar A -2.20% | C -2.00% | P -0.20%

12:30     CAD       Net Change in Employment Apr A -1.1K | C 20.5K | P 32.3K

12:30     CAD       Unemployment Rate Apr A 5.80% | C 5.80% | P 5.80%

12:30     USD       Import Price Index M/M Apr A 0.30% | C 0.50% | P 0.00% | R -0.20%

14:00     USD       U. of Mich. Sentiment May (P) A 98.8 | C 98.4 | P 98.8

Stay lucky

Andy

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