Daily FX Market Commentary

Good morning,

 

LMAX Close

USDJPY 111.135 | EURUSD 1.15947 | AUDUSD 0.71134 | NZDUSD 0.65224 | USDCAD 1.31633 | USDCHF 0.97503 | GBPUSD 1.30267 |

 

LMAX Highs and Lows 5.15am GMT

                                High | Low

EURUSD               1.16042 | 1.15777

USDJPY                 111.480 | 111.076

GBPUSD               1.30483 | 1.30209

USDCHF               0.97591 | 0.9745

AUDUSD              0.71259 | 0.7092

USDCAD               1.31718 | 1.31442

NZDUSD               0.65315 | 0.65184

EURCHF                1.13107 | 1.12989

EURGBP               0.89028 | 0.8890

EURJPY                 129.282 | 128.818

 

For today

• GBP: A quiet rise through the session with volumes only slightly stronger than yesterday opening around the 1.3030 areas the market slowly rose through to the 1.3040 level before drifting off until late in the session and testing through to the 1.3050 areas and into the grey hour, Topside offers into the 1.3050 level with a mix of weak stops and congestive offers through the level with the offers likely to increase on any move towards the 1.3100 level and reasonable strong in that area, any move through will likely take time on a move to the 1.3150 level with stronger stops likely through that level, downside bids light back through the 1.3000 level with weak stops on a push through on to the 1.29 handle and opening up a quick test back to the 1.2950 before bids truly start to appear and continue through to the stronger 1.2900 levels.
• JPY: Holding quietly through into the Tokyo session the market traded around the opening 111.10 level before heading quickly higher to push towards the 111.50 level before holding quietly around the level through to the grey hour, nothing special seen on the move higher, light offers into the current highs with the market lightly congestive to the 111.80 level and stronger offers moving in from there into the 112.00 areas, a push through the 112.10-20 area will likely see weak stops appearing however, there could be some light profit taking appearing in the area and the market struggling through to the 112.50 level and better offers starting to appear, congestive offers are likely to continue from that point, downside bids light through to the 111.00 areas with weak stops on a dip through the 110.80 area and the market opening to the 110.50 where better bids are likely to appear and weak congestion below the level.
• AUD: Limited range but choppy nonetheless with the move through into the Tokyo session remaining quiet, NAB numbers mixed with conditions seen to be improving while confidence dipped, initially dropping to the 0.7092 level on the dip after the number before rising quickly back to the starting level and then driving higher after an hour or so to push through to the 0.7120 areas for the move into the grey hour on its highs. Downside bids through the 71 cents level with weak stops possible through the 0.7080 level however, the downside is likely to see congestive bids for a good distance with the sentimental levels likely to be stubborn through to the 70 cents level, possible option plays in that area having not seen the area since 2016. Topside offer light through the 0.7250 area with possibly some weak stops along the way and stronger offers not likely to be seen until the market pushes towards the 73 cents level with stops possibly beyond that level.
• EUR: A quiet move through into the Tokyo session holding the opening levels around the 1.1595 area then dropping back through to the 1.1580 level and slowly recovering through to the grey hours testing lightly through the 1.1600 level. downside bids could possibly be fairly strong through to the 1.1500 level with weak stops likely to appear into the 1.1480 area and the market then open to a test through to the 1.1420-00 with strong bids into the level and congestion likely through the level. Topside offers through the to 1.1620 level are likely to be light with increasing offers into the 1.1650 areas and congestion likely to increase on any test towards the 1.1680-1.1700 areas, limited stops through the level and not until a strong break through the 1.1740 level will the market see stops appearing.

 

 

Overnight News

USD:

Florence becomes a category 4 hurricane NHC

Trump plunges to new low among independent voters

OIL:

Crude dips on Saudi supply balancing Iran sanctions

USD/CNY:

US said to consider China sanctions over Muslim internment camps

RUB:

Ruble plunges on US sanction fears

NZD:

NZ traffic gauges suggests economy losing momentum ANZ

USD/EUR/GBP:

US holds talks with UK and France on possible Syria strikes

GBP:

UK may lose £7b in VAT if no law changes post Brexit Times

CNY:

China steel producers slide as Moody’s sees demand contracting

SEK:

Sweden’s Democrats get additional parliament seat in latest count

 

Today’s data

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

JPY         Japan Money Stock M2+CD Y/Y Aug A 2.90% | C 3.00% | P 3.00% | R 2.90%

AUD       NAB Business Conditions Aug A 15 | P 12

AUD       NAB Business Confidence Aug A 4 | C 5 | P 7

JPY         Tertiary Industry Index M/M Jul A 0.10% | C 0.10% | P -0.50% | R -0.60%

08:30     GBP       Jobless Claims Change Aug C 3.6K | P 6.2K

08:30     GBP       Claimant Count Rate Aug P 2.50%

08:30     GBP       Average Weekly Earnings 3M/Y Jul C 2.50% | P 2.40%

08:30     GBP       Weekly Earnings ex Bonus 3M/Y Jul C 2.70% | P 2.70%

08:30     GBP       ILO Unemployment Rate 3Mths Jul C 4.00% | P 4.00%

09:00     EUR        German ZEW Economic Sentiment Sep C -13.4 | P -13.7

09:00     EUR        German ZEW Current Situation Sep C 72.3 | P 72.6

09:00     EUR        Eurozone ZEW Economic Sentiment Sep C -14.9 | P -11.1

09:00     EUR        Eurozone Employment Change Q/Q Q2 C 0.40% | P 0.40%

09:00     EUR        Eurozone Employment Change Y/Y Q2 C 1.40% | P 1.40%

12:15     CAD       Housing Starts Aug C 218K | P 206K

14:00     USD       Wholesale Inventories M/M Jul (F) C 0.70% | P 0.70%

 

Harry Hindsight

• GBP: A quiet range through the Asian session with the market opening around the 1.2925 areas and unable to really push through the 1.2930 level or much below the opening level to be honest, the move towards the grey hour saw the market drifting and testing to the 1.2910 areas for the move into the grey hour, London opening saw the market test through the 1.2900 level on a quick early move however, having tested just below the level it was unable to continue the move and rose steadily on the London opening pushing through to the 1.2940 before seeing any resistance to the move, Trade balance and services index were the bright highlights out of the numbers and the market managed to move just above the 1.2950 level before totally stalling and drifting to the NYK session, news that EU negotiators are being directed to compromise and get a deal gave the market hope and the market quickly moved through to the 1.3050 level dropping back having hit a limited barrier and trading quietly through to the close.
• JPY: Opening around the 111.00 level the market moved quietly through the Asian session basing along the 110.90 area and unable to push to far beyond the 111.05 areas, the move into the London session saw very little difference with early morning holding the same range before slowly moving up to range around the 111.10 areas and a slow tight range through to the close testing late in the day to the 111.20 areas before closing little changed on the day.
• AUD: The Oz opened and tested through towards the 71 cents level before rising back to above the 0.7110 level and range around that level in quiet trading through to the London session, early London saw the market testing the lows again and failing only to bounce off the level and steadily push to above the 0.7120 areas and base along that level deep into the NYK session before drifting through to the end of the session with poor volumes to settle little changed on the day.
• EUR: Opening around the 1.1550 area with the market slowly lifting through to the 1.1565 area and the Asian high before drifting slowly lower through into the through to the grey hour testing the 1.1540 areas, the grey hour saw the low for the day as the market quickly dropped through to the 1.1525 level before heading back steadily through to the 1.1570 as London opened, moving quietly through midmorning to test to the 1.1585 level before drifting until the NYK session and the opening there seeing the market quickly move to above the 1.1615 area as the GBP dragged the Euro along, the rest of the session was a slow drift through to the close with a very light session over.

 

Yesterday’s premiership results

NZD       Manufacturing Activity Q2 A 1.80% | P 0.60% | R 0.70%

JPY         GDP Q/Q Q2 (F) A 0.70% | C 0.70% | P 0.50%

JPY         GDP Deflator Y/Y Q2 (F) A 0.10% | C 0.10% | P 0.10%

JPY         Current Account (JPY) Jul A 1.48T | C 1.56T | P 1.76T

CNY        CPI Y/Y Aug A 2.20% | C 2.10% | P 2.10%

CNY        PPI Y/Y Aug A 4.10% | C 4.10% | P 4.60%

EUR        Eurozone Sentix Investor Confidence Sep A 12 | C 13.8 | P 14.7

GBP       Visible Trade Balance (GBP) Jul A -10.0B | C -11.7B | P -11.4B | R -10.7B

GBP       Industrial Production M/M Jul A -0.20% | C 0.40% | P 0.40%

GBP       Industrial Production Y/Y Jul A 0.90% | C 1.00% | P 1.10%

GBP       Manufacturing Production M/M Jul A 0.10% | C 0.30% | P 0.40%

GBP       Manufacturing Production Y/Y Jul A 1.10% | C 1.50% | P 1.50%

GBP       Construction Output M/M Jul A 0.50% | C -0.40% | P 1.40%

GBP       GDP M/M Jul A 0.30% | C 0.20% | P 0.10%

GBP       Monthly GDP 3M/3M Change Jul A 0.60% | C 0.60% | P 0.40%

GBP       Index of Services 3M/3M Jul A 0.60% | C 0.50% | P 0.50%

 

 

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