Daily FX Market Commentary

Andy Harrison

Good Morning,

LMAX Close

USDJPY 109.252 | EURUSD 1.13888 | AUDUSD 0.71927 | NZDUSD 0.67452 | USDCAD 1.32769 | USDCHF 0.99424 | GBPUSD 1.29853|

LMAX highs and Lows 06.00 GMT

                                Highs | Lows

EURUSD               1.14000 | 1.13854

USDJPY                 109.443 | 109.057

GBPUSD               1.29951 | 1.29662

USDCHF               0.99445 | 0.99345

AUDUSD              0.72053 | 0.71859

USDCAD               1.32850 | 1.32669

NZDUSD               0.67743 | 0.67531

EURCHF                1.13262 | 1.1321

EURGBP               0.87883 | 0.87674

EURJPY                 124.676 | 124.234

For Today

  • GBP: Another slow day for Cable with the market moving sideways into Tokyo around the 1.2985 areas before dipping a little through to the 1.2965 area, the market regained its losses on a small run to the 1.2995 areas however, the range defined the market drifted to the grey hours, unchanged for the most part, topside congestion through the 1.3000 level and likely weak stops on a push through the 1.3010-20 areas could see a small squeeze through to what looks likely stronger offers through the 1.3050 areas with limited congestion once through until closer to the 1.3100 level, downside bids a little weak on any test through to the 1.2900 areas with very little in between the current level and that point, weak stops on any move through the level and the market likely to see sentimental bids only into the 1.2850 areas and weakness quickly reappearing.
  • JPY: Opening around the 109.25 level the market dropped quickly into early Tokyo to make the low just above the 109.15 level, the opening saw steady buying through to the Tokyo fix before settling into a tight range around the 109.35 level and limited rises late into the session towards the 109.45 level on weekend buying of USD’s, topside see’s light offers through the 109.50 level with the market then opening to the 109.80 area and stronger offers likely to appear on any move to push through the 110.00 levels for the moment, weak stops through the level and the market likely to test to the 110.50 areas where stronger offers are likely to reappear and increasing into the 110.80-111.00 level, downside bids light into the 109.00 level however, congestion is likely to be a little deeper with a mixture of weak stops through the 108.80 areas quickly being absorbed on any dips towards the 108.60-40 areas and stronger bids reappearing into the 108.20 areas.
  • AUD: A fairly tight range for the Oz with the market holding around the 0.7190 level through to the Tokyo session, AUDJPY buying into the Tokyo fix saw the market hit its highs just above the 0.7205 levels however the market then ranged broadly around the 0.7200-0.7190 levels through to the grey hours before dipping through the 0.7190 level to make the lows. Downside bids light through to the 0.7160 level and the congestion likely to continue into the 0.7140 levels, weak stops on a move through the level could have some impact on the 71 cents areas however, bids in the area are likely to take the edge off the move and only a break below the 71 cents will see stronger stops appear. Topside offers light through to the 0.7220 level where the market has been held for the most part this week limited potential for damaging stops with stronger offers likely to appear quickly around the 0.7240-60 level and possibly a tall order for the Oz.
  • EUR: A slow rise from the opening saw the Euro edging through early Tokyo to the 1.1400 areas then holding quietly around the 1.1395 level for much of the session, the move to the grey hours saw the market drifting with little going through on a quiet day, testing to the 1.1390 level and a pip or two through. Topside offers congested through the 1.1420 level for the moment but expect some weak stops to appear for a move to the stronger sentimental area around the 1.1440-60 area and while there may be a patch of weakness the market builds to stronger offers on any push for the 1.1500 level. downside bids in the current areas however, this congestion is likely to continue in a fashion all the way down to the stronger 1.1280-1.1300 strong bids.

 

 

Overnight News

EUR:

Google faces third EU antitrust fine within weeks

GBP:

UK House of Lords call for change in gauge used for index-linked bonds

May faces tough talks with opponents to get new Brexit deal

CNY/USD:

China confirms VP Liu will visit the US from Jan 30

China Q4 growth seen slowing to 6.4% as domestic, export demand cools Poll

China brushes off outrage over death sentence, Canada fires back

CNY/KRW/USD;

Top N. Korean official in Beijing on route to Washington

 

 

Today’s Data

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

NZD       BusinessNZ Manufacturing PMI Dec A 55.1 | P 53.5 | R 53.7

JPY         National CPI Core YoY Dec A 0.70% | C 0.890% | P 0.90%

JPY         Industrial production MoM Nov (F) A -1.00% | C -1.10% | P -1.10%

0730       CHF        Producer & Import Prices MoM Dec C -0.20% | P -0.30%

0730       CHF        Producer& Import Prices YoY Dec P 1.40%

0900       EUR        Eurozone Current Account (EUR) Nov C 24.1B | P 23.0B

0930       GBP       Retail Sales Ex Auto Fuel MoM Dec C -0.50% | P 1.20%

0930       GBP       Retail Sales ex Auto Fuel YoY Dec C 4.00% | P 3.80%

0930       GBP       Retail Sales Inc Auto Fuel MoM Dec C -0.70% | P 1.40%

0930       GBP       Retail Sales Inc Auto Fuel YoY Dec C 3.50% | P 3.60%

1330       CAD       Intl Securities Transactions (CAD) Nov P 3.98B

1330       CAD       CPI MoM Dec C -0.30% | P -0.40%

1330       CAD       CPI YoY Dec C 1.80% | P 1.70%

1330       CAD       CPI Core Common YoY C 1.80% | P 1.90%

1330       CAD       CPI Core Median YoY Dec C 1.90% | P 1.90%

1330       CAD       CPI Core Trimmed YoY Dec C 1.80% | P 1.90%

1415       USD       Industrial production MoM Dec C 0.20% | P 0.60%

1415      USD       Capacity Utilization Dec C 78.40% | 78.50%

1500       USD       U. of Mich. Sentiment Jan (P) C 96.1 | P 98.3

 

Harry Hindsight

  • GBP: Lacklustre Asian session for Cable with the market opening around 1.2880 all attempts to push the 1.2890 failed and each time the market drifted back, the first move falling back to the opening levels and the second attempt forcing the market back into the 1.2860 levels for the move into the grey hours, grey hour selling moved In and the market continued its selling falling through into the open of London and continuing to set the low for the day testing to the 1.2830’s before finding support as PM May started to see opposition MP’s in a move to get more consensus for her already defeated Brexit plan, as if it could be resurrected with the EU unwilling to bend, the market regained the opening levels in early morning and as the market pushed towards the NYK session pushed quickly to the 1.2900 levels and ranged around the level for several hours, as London started to put their coats on the market came to life and rallied quickly triggering some weak stops on a move to the 1.2950 level with a long grind continuing through to test the 1.3000 levels late into the NYK session, the run to the close was a slow drift with the market sitting just off those highs.
  • JPY: For the most part a very quiet day for USDJPY with the market drifting from the opening 109.10 level to push slowly through into Tokyo and test to the 108.80 areas and then recovering a little from the early lows. The move to the grey hours again saw the USDJPY drifting and the market tested to the 108.70 level on the move into the London session and while the market ranged for awhile around the 108.80 areas it was unable to push through the 108.70 level with any conviction through into the NYK session, eventually the market gave up with the downside and started a slow steady rise through to the end of London to recapture the opening areas, late into the session some strong buying moved in, as US team are expected not to appear at Davos and testing through the 109.30 levels and while it failed to push beyond the 109.40 level the market sat back for the run to the close holding around the 109.20 areas.
  • AUD: The Oz remained under pressure for much of the day in a quiet 0.7150-70 range for the most part opening around the upper level the market made several brief attempts to push beyond the 0.7175 level before drifting through the Asian session to test the downside, grey hour selling from early London saw the lows set testing into the 0.7140 levels with very little conviction before recovering through early London to hold quietly around the 0.7170-75 areas into NYK, the move through into the NYK session saw light selling and the market again testing the 0.7150 areas with as much conviction as the previous attempt and it wasn’t long before the market was again pushing the 0.7175 areas, with USDJPY leaping ahead the Oz caught the pull with cross AUDJPY buying moved through and the Oz quickly pushed the 0.7220 dropping quickly back to sub 72 cents but clearing some of the offers that have built this week.
  • EUR: Range bound day again for the Euro’s with the market opening around the 1.1380 areas and attempting to push through the 1.1400 into early Tokyo however, after a short period the market started a slow drift lower having failed to move through and tested down to the 1.1380 level to define the Asian range, the move into the grey hours saw some strong selling in an early attempt to push through the 1.1370 areas only to sharply bounce back and the market made steady headway on a move through the 1.1400 level to test through to NYK pushing for the 1.1405 area, early NYK renewed the selling and the market slipped back through to the 1.1380 in early trading before extending to the 1.1370 before again refusing the level and pushing back to range around the 1.1380 level for the long fun to the close.

 

Yesterday’s Premiership results

GBP       RICS House Price balance Dec A -19% | C -13% | -11%

AUD       Home Loans MoM Nov A -0.90% | C -1.40% | P 2.20% | R 2.10%

EUR        Eurozone CPI MoM Dec (F) A 0.50% | C -0.20% | P -0.20%

EUR        Eurozone CPI YoY Dec (F) A 1.60% | C 1.90% | P 1.90%

EUR        Eurozone CPI Core YoY Dec (F) A 1.00% | C 1.00% | P 1.00%

USD       Housing starts Dec A 213K | C 1.25M | P 1.25M

USD       Initial Jobless claims A 213K | C 218K | P 216K

USD       Philadelphia Fed business outlook Jan A 17 | C 10.1 | P 9.4

USD       Natural gas storage A -81B | C -73B | P -91B

 

*US numbers affected by Government shutdown so may not appear when they are supposed to.

 

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LMAX Exchange Market Commentary   Andy Harrison  

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LMAX Group 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 produced information was obtained from sources deemed to be reliable, LMAX Group 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. It is not a place to slander, use unacceptable language or to promote LMAX Group or any other FX 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.