Daily FX Market Commentary

Good morning,

 

LMAX Close

USDJPY 111.851 | EURUSD 1.1683 | AUDUSD 0.71821 | NZDUSD 0.65795 | USDCAD 1.3043 | USDCHF 0.96257 | GBPUSD 1.3159|

 

LMAX Highs and Lows 5.15am GMT

                                High | Low

EURUSD               1.17031 | 1.16665

USDJPY                 112.024 | 111.67

GBPUSD               1.31630 | 1.31402

USDCHF               0.96298 | 0.96171

AUDUSD              0.72090 | 0.71444

USDCAD               1.30649 | 1.30338

NZDUSD               0.66029 | 0.65619

EURCHF                1.12521 | 1.12339

EURGBP               0.88921 | 0.8872

EURJPY                 131.035 | 130.305

 

For today

• GBP: Opening quietly the Cable dipped into the Tokyo session falling back through the 1.3150 areas testing into midsession to the 1.3140 areas and holding quietly for a long period, the market quickly recovered with a couple of hours to the grey hours to return to the opening levels around the 1.3160 for the move into the grey hour, Topside offers through to the 1.3200 levels limited with stronger congestion on a push through the figure level and too the 1.3220 areas before weak stops appear, however, congestion from that point on and through to the 1.3300 level with stronger offers in the area, with some stronger congestion likely through that level and into the 1.3350 areas. Downside bids light through to the 1.3120-00 areas with some stronger bids likely but possibly disappearing quickly on a strong dip lower and opening the market to the 1.3050 areas where better bids appearing.
• JPY: A weaker USDJPY from the opening saw the market move into the Tokyo session dropping quickly back to the 111.70 level with minor dips below the level before starting a steady rise back through the opening levels and push through the session to the 112.00 areas before holding quietly through to the grey hour holding just below the highs. Light offers through the 112.20 area opens up the market to the 112.50 area and possibly stronger offers around that level and only once the market is pushing the 112.80-113.00 area does the market possibly opening up to a stronger move higher.
• AUD: Opening around the 0.7180 areas before dropping quickly off too the 0.7145 areas before holding the level and a steady reversal and quickly triggering weak stops on a move through the opening level through to the 72 cents level spiking to the 0.7210 areas before holding around the figure area through to the grey hour thanks to a limited RBA minutes. Downside bids into the 0.7140 levels likely sees stronger congestive bids through to the 71 cents level however, so far this month the market has been fairly supportive in the area and any dip through is likely to see those bids continuing through the 0.7080 area with strong stops likely through the level.
• EUR: Same pattern as the Oz with the Euro initially dropping back to the 1.1670 areas before starting a slow rise through to late in the session and a quick climb higher push to the 1.1700 level and holding for a couple of hours through to the grey hour, topside offers into the 1.1700 area, with congestive offers likely to continue through to the 1.1740 areas what stops there are, are likely to be just behind the level however, the congestion from there is likely to increase on any move to push through to the July highs and increasing into the 1.1800 area. Downside bids light through to the 1.1640 area with congestion then appearing for any move to the 1.1600 level, possible weak stops on a move through but one suspects that the congestion is likely to continue through the level and 1.1540 and the months lows are likely to see bids appearing.

 

 

Overnight News

NZD:

NZ Ardern “pretty pleased” after hint on 2q GDP

EUR:

Irish said to face EU Tax pressure in return for Brexit support

EU is said to insist that UK can’t renegotiate Brexit Times

Brexit and beyond: EU sees Theresa May’s plan as competitive threat

Italy’s Di Maio renews threat to seek FinMin’s Ouster Stampa

CNY:

China’s Central bank has $1.3T headache with money funds BBG

Swine fever mystery threatens China’s $128B pork industry

China Commerce minister: China has confidence, ability to achieve this year’s targets

CCM: China will step up its opening up on a higher level

CCM: There is no winner in a trade war

CCM: US’s unilateralism, protectionism will impact both US and China’s interests

CCM: Will hurt global economy, does no good to any country

CCM: Cooperation between China and us is the only correct choice on trade

CCM: China will create better business environment for companies

Representatives that met with CCM said they will continue to expand investment, cooperation in China

CCM: Made remarks during a meeting with representatives of Foreign firms on Monday

GBP:

Voters prefer no deal to Theresa May’s Brexit, project fear won’t change that TEL

Moment of truth, Italy on very of disaster ahead Express UK

Italy budget headlines to (potentially) set the risk tone for Europe this week Express

USD:

Trump announces plans for China tariffs worth roughly $200B

Tariff rate on China list 10% to end of 2018, rises to 25%

Trump: If China retaliates he will immediately pursue tariffs on $267B

TRY:

Turkey: Presidential decree on carrying out tertian transaction on TRY

 

Today’s data

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

AUD       House Price Index Q/Q Q2 A -0.70% | C -0.70% | P -0.70%

AUD       House Price Index Y/Y Q2 A -0.60% | P 2.00%

AUD       RBA Minutes Sep

12:30     CAD       Manufacturing Sales M/M Jul C 1.00% | P 1.10%

14:00     USD       NAHB Housing Market Index Sep C 66 | P 67

20:00     USD       Net Long-term TIC Flows (USD) Jul C 65.1B | P -36.5B

22:45     NZD       Current Account (NZD) Q2 C -1.32B | P 0.18B

23:50     JPY         Trade Balance (JPY) Aug C -0.14T | P -0.05T

 

Harry Hindsight

• GBP: A slow rise through the Asian session trading from the 1.3075 areas and basing just below that level through into the Tokyo session, the market rose steadily through the 1.3080 into the grey hour and tested the 1.3090 before light selling into the opening in London and reversing much of the gains, with stronger rumours of a fix for Brexit the market started to rise steadily initially to the 1.3100 level and holding until early afternoon before pushing through and the addition of NYK buyers saw the market quickly running through to the 1.3150 areas, the end of London and the market testing to the 1.3165 areas to make the high and holding close to the level through to the close.
• JPY: A choppy limited range for the USDJPY saw the market trading around the 112.00 areas through to the latter part of the day however, Tokyo made the highs for the day with some limited buying for the Tokyo fix taking the market steadily through to just above the 112.10 areas before falling back to the figure level again, London opening saw the market sold back to the 111.85 areas before bouncing and recovering to the figure and trading around the level through into the NYK session, the move through NYK was limited until late in the day with a quick move through the lows and testing to the 111.80 areas slipping a little through the area before recovering only slightly into the close.
• AUD: Early selling saw the market drifting from the opening around the 0.7155 areas to test to the lows of the day and slowly recovering from that 0.7142 area to push through into the London session testing above the 0.7160 area, London continued through early morning to push above the 0.7170 levels and then a quiet range into the London session and light buying resumed with the market pushing through the 0.7180 area and triggering some light stops to test towards the 72 cents level before running out of steam however, the market remained quiet before running to the close around the 0.7180 area.
• EUR: A slow range through the Asian session with the market basing off the 1.1625 areas and eventually moving through to the 1.1635 area for the move into the London session, some weak selling on the move into the London session saw the market testing through the 1.1620 areas before reacting to the stronger inflationary numbers and rising through to the 1.1650 area, with Cable pushing steadily higher the Euro tagged along for the ride, the move through to the NYK session saw the market slowly pushing through to the 1.1690 areas before finding sufficient offers to slow its ascent and finally finish its rise just below the 1.1700 areas, the market then drifted to the close holding the 1.1685 areas.

 

Yesterday’s premiership results

GBP       Rightmove House Prices M/M Sep A 0.70% | P -2.30%

EUR        Eurozone CPI M/M Aug A 0.20% | C -0.30% | P -0.30%

EUR        Eurozone CPI Y/Y Aug (F) A 2.00% | C 2.10% | P 2.10%

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

CAD       International Securities Transactions (CAD) Jul A 12.65B | C 4.35B | P 11.55B | R 10.30B

USD       Empire State Manufacturing Index Sep A 19 | C 23.2 | P 25.6

 

 

 

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