Daily FX Market Commentary

Good Morning,

 

LMAX Close

USDJPY 113.279 | EURUSD 1.13692 | AUDUSD 0.72202 | NZDUSD 68568 | USDCAD 1.33512 | USDCHF 0.99351 | GBPUSD 1.26291 |

LMAX highs and Lows 06.00 GMT

                                Highs | Lows

EURUSD               1.13771 | 1.13647

USDJPY                 113.504 | 113.207

GBPUSD               1.26550 | 1.26101

USDCHF               0.99398 | 0.9922

AUDUSD              0.72304 | 0.72126

USDCAD               1.33658 | 1.3344

NZDUSD               0.68651 | 0.6843

EURCHF                1.13038 | 1.12824

EURGBP               0.90198 | 0.89904

EURJPY                 129.033 | 1.28662

For Today

  • GBP: Excitement over with for the day with the market drifting away from the opening levels to test through to the 1.2610 level, with limited bids to the downside the market is likely to see some weak stops on a move back through the 1.2590 areas opening the market to weak sentimental 1.2550, and to be honest very little difference from 24hrs ago, stronger bids on a move the 1.2480 limit and congestion likely through to the 1.2450 areas before possibly a deeper level of weakness through to the 1.2300 areas and an old trendline possibly key to any further dips. Topside offers light through to the 1.2680 area having mostly being cleared, with weak stops likely to appear on any move through the 1.2700 level and competing with limited congestion.
  • JPY: Opening around the 113.25 level the market moved into the Tokyo session moving off the 113.20 lows to steadily climb through the early part of Tokyo and recover the highs from yesterday around the 113.50 level, no clear break saw the market then ranging close to that high through to the grey hours, Topside offers into the 1.1380-114.00 areas with congestion above the level and weak stops hanging just above the area and opening the market to the stronger 114.40-60 areas, a push through the level will likely see weak offers through to the 115.00 area with limited congestion through the level and into the 115.50 area with a break here opening a stronger move through to the 117.00 level intraday. Downside bids light through to the 113.20 level with strong congestion likely to continue through the figure area and into the 112.50 levels however, even through this level the opportunity for yield buyers to continue buying opens and the any move to the 112.00 is likely to be a struggle.
  • AUD: I’d like to say it was an exciting day in the Oz however, it would be a tall one for a day of drink and barbies, the market opened just below the 0.7220 level and slipped as low as 0.7212 before rising through to test the 0.7230 and the range was set with the market running to the grey hours holding just below that level, downside bids into the 0.7150 likely to be particularly strong and likely to be very congested on any dip through the levels to the 71 cents level. topside offers lightly congested through to the 0.7220 cents level with any move to the 0.7250 areas likely to meet little resistance before opening for a move higher and stronger offers into the 0.7280-0.7300 levels.
  • EUR: Quiet from the opening with the market ranging around the opening levels, early push above the 1.1375 areas saw the Tokyo session open and the drift through to the 1.1365 area for a long run through to the grey hours, Downside bids strong through the 113.00 level and likely to see weak stop appearing on any strong selling through the 112.80 areas with minor congestion through the level and the market reopening the downside 1.1220-00 support areas for testing. Topside offers light through to the 1.1400 levels some congestion then running through the level with limited stops and stronger congestion through the 1.1440-60 levels with increasing offers then appearing on any test into the 1.1480-1.1500 level.

 

Overnight News

EUR:

Recession risk leaves EU acutely vulnerable to British Brexit walk out – Telegraph

A .38caliber rosary, the dangerous new face of Salvini’s Italy – Spiegal

USD:

Trump’s antitrust chief says still studying anti-OPEC bill

Ross says US seeks fundamental structural changes from China

GBP:

PM May no confidence vote result, PM survives with 200 votes to 117

No confidence vote gives PM May 1 year to go unchallenged

GBP/EUR:

Bad news for PM May’s Brussels trip as EU leaders will give her only 10 minutes of their time

NZD:

NZ slips as NZ treasury lowers GDP – Budget forecasts

APAC:

Cooling measures start to bite in APAC housing markets – S&P

CNY:

China’s rich rush to shelter $1T from new taxes – BBG

 

Today’s Data

Actual – A | Consensus – C | Previous – P | Revised R | all timings GMT/UTC

AUD       Consumer inflation expectation Dec A 4.00% | P 3.60%

GBP       RICS house price balance Nov A -11% | C -9% | P -10%

0700       EUR        German CPI MoM Nov (F) C 0.10% | P 0.10%

0700       EUR        German CPI YoY Nov (F) C 2.30% | P 2.30%

0815       CHF        Producer & Import prices MoM Nov C 0.00% | P 0.20%

0815       CHF        Producer & Import prices YoY Nov P 2.30%

0830       CHF        SNB sight deposit interest rate C -0.75% | P -0.75%

0830       CHF        SNB 3-month Libor lower target range C -1.25% | P -1.25%

0830       CHF        SNB 3-Month Libor upper target range C -0.25% | P -0.25%

1245       EUR        ECB Bank rate decision C 0.00% | P 0.00%

1330       CAD       New Housing price index MoM Oct C 0.00% | P 0.00%

1330       USD       Import price index MoM Nov C -1.00% | P 0.50%

1330       USD        Initial jobless claims (Dec 8) C 227K | P 231K

1530       USD       Natural Gas storage C -81B | P -63B

1900       USD       Monthly Budget statement Nov P -100.5B

 

Harry Hindsight

  • GBP: A slow rise from the opening around the 1.2485 lows saw the market rising through to push above the 1.2505 areas and ranging around the level through to the grey hours, light buying saw the market entering the grey hours testing a little above the 1.2510 area before dipping on light selling to test through to the 1.2480, the move into the London session saw the long awaited delivery of the 48th letter to the 1922 committee and initiating a no confidence vote, conservative estimates through the day but initially the market pushed quickly through to the 1.2550 before holding through to the move into the afternoon around the 1.2535 levels, the move towards the NYK session saw the Cable again lifting with several media outlets suggesting that PM May would win the confidence vote with a vast majority and the market pushed through into the NYK session grinding steadily higher to press the 1.2670 levels however, it ran out of space and ides as the market held through to the vote and result, with voting starting at 1800hrs and ending 2000hrs with the result due to be released at 2100hrs several new expectations started to appear, the no confidence vote (expected to be beaten) became the focus of attention with early expectations of 80-90 however, the higher this could go the more descension likely within government, the market dipped a little back to the 1.2630 level before holding into the release around the 1.2650 area, 200 vs. 117, the reaction initially was to test again to the highs before dropping quickly back to push the 1.2600 level before finishing just above the 1.2600 for the close.
  • JPY: Holding quietly through into the Tokyo session with the market dipping lower on the Tokyo opening to the 113.30 areas before quickly regaining the opening and pushing through to the 113.50 areas, the market ranged through the Asian session around the 113.45 levels deep into the London session, the market started to dip through into the NYK session with the market slowly drifting through to hold the 113.15 level on very little interest and basing through to the close.
  • AUD: A very limited range for the Oz with the currency rising from the opening 0.7200 area and testing through to the 0.7230 in early Tokyo which was roughly the range for the day, the market traded quietly for a couple of hours before starting a slow drift through to the grey hours and the London opening trading around the 0.7210 areas, some range through to the NYK session but unable to push above the 0.7220 level and eventually dipping through to the 72 cents level again, NYK pushed the market a little and the drag of the Cable as it moved higher saw the Oz pushing for the one attempt through the 0.7230 level and testing to the 0.7238 areas before dipping back to range in the 0.7210-20 to the close.
  • EUR: A slow rise in early Tokyo saw the market moving from the opening around the 1.1320 areas to test through to the 1.1335 areas before drifting for the balance of the session slipping lower until the grey hours and light buying into the London session a little bit of a chop between the 1.1315 level and the 1.1330 areas eventually saw the market move a touch higher to hold around the 1.1335 area before the move to just before NYK opening and a push quickly through to the 1.1365 areas, before settling into a 1.1360-80 range with one brief test through the highs before halting and moving back into the range for the move to the close.

 

Yesterday’s Premiership results

AUD       Westpac consumer confidence Dec A 0.10% | P 2.80%

JPY         Domestic CGPI YoY Nov A 2.30% | C 2.40% | P 2.90% | R 3.00%

JPY         Machine orders MoM Oct A 7.60% | C 10.20% | P -18.30%

JPY         Tertiary industry index MoM Oct A 1.90% | C 0.90% | P -1.10% | R -1.20%

EUR        Eurozone industrial production MoM Oct A 0.20% | C 0.20% | P -0.30%

USD       CPI MoM Nov A 0.00% | C 0.10% | P 0.30%

USD       CPI YoY Nov A 2.20% | C 2.20% | P 2.50%

USD       CPI Core MoM Nov A 0.20% | C 0.20% | P 0.20%

USD       CPI Core YoY Nov A 2.20% | C 2.20% | P 2.10%

USD       Crude Oil Inventories A -1.2M | C -3M | P -7.3M

 

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