Daily FX Market Commentary

Andy Harrison

Good Morning,

LMAX Close

USDJPY 111.472 | EURUSD 1.13253 | AUDUSD 0.70856 | NZDUSD 0.68464 | USDCAD 1.33379 | USDCHF 1.00217 | GBPUSD 1.32927 |

LMAX highs and Lows 06.00 GMT

                                Highs | Lows

EURUSD               1.13386 | 1.13192

USDJPY                 111.631 | 111.481

GBPUSD               1.33002 | 1.32713

USDCHF               1.00246 | 1.00149

AUDUSD              0.71151 | 0.70783

USDCAD               1.33465 | 1.33162

NZDUSD               0.68683 | 0.6840

EURCHF                1.13557 | 1.13475

EURGBP               0.85388 | 0.85116

EURJPY                 126.498 | 126.202

For Today

• GBP: Very little news with meaning over the weekend left the Cable stalled in the 1.3285-1.3300 area through the whole session and drifting into the grey hours probing the downside level, Topside offers thin through the 1.3300 level and possibility of an option play around the level leading to weak stops possibly through the 1.3320 areas, weakness reappears on a test through the 1.3350 area and better congestive offers into 1.3380-1.3400 level with further congestion likely to appear on a move through the level and possibly absorbing what stops there are until the 1.3430-50 level where weakness is likely to reappear and stronger stops appearing for a push to the weak 1.3500 areas and sentimental values only. Downside bids very weak and really nothing special until the market moves back onto the 1.3000 level after 48hrs of moves higher and lower, weak congestion through to that level if the market moves back onto that handle, with congestion likely to continue through to slightly stronger bids into the 1.2950-1.2900 areas.
• JPY: With limited news and volumes the USDJPY opened unchanged and trading quietly to the Tokyo session lifting off the opening areas just below the 111.50 level to push above the 111.60 area into mid-session before again drifting back towards the 111.50 level for the move into the grey hours, Topside offers into the 111.80-112.20 level however, given the amount of time the market has failed the level one has to suspect stops appearing in size through the level and the market opening quickly through to sentimental offers only around the 112.50 areas and only limited offers through to the stronger 113.00-30 area. Downside bids light through to the 111.00 area with some congestion however, stronger congestion is likely to appear on any dip through the level and continue through to the 110.50 levels with limited stops likely to be absorbed, even if the market breaches the 110.50 level the 110.00 area is likely to be even tougher to push cleanly through.
• AUD: Opening unchanged the early market tested through the 0.7080 level before moving into the Tokyo session and besides the dire housing issue started a steady rise through the 0.7100 levels to push towards the 0.7115 area and holding through to the grey hours in the area, , downside bids into the 70 cents level and possibly just through the level before weak stops appear however, congestion is possibly all the way down to the 0.6950 levels and strong in that area with only limited weakness on any further pushes to wards 69 cent, topside offers thinned through to the 0.7120 level and that resistance is still building and a push through the 0.7120 level will see the congestion swept away to open the market to a slow grind higher and stronger offers through 0.7150 and ultimately 72 cents and stronger offers.
• EUR: Unchanged for the opening the market moved quietly lower into the Tokyo session testing to the 1.1320 level for the lows and then rising slowly through the Tokyo period to the 1.1340 area before holding quietly for the move into the grey hours, Topside congestion through the 1.1340-60 area with the market then opening to stronger offers into the 1.1380-1.1420 area with weak stops on a move through the level however, congestion is likely to be still present and limiting any rush through to the stronger 1.1480-1.1500 level. downside bids congested a little around the 1.1300 levels however, weak stops on a move below the 1.1280 level and the market again opening to the 1.1200-1.1180 areas with strong bids likely in the area, any push through the level is likely to see continuing congestion through to the 1.1150 levels before any weakness truly appears.

Overnight News

JPY:

Japan lifers on guard against flash Yen moves as Holiday’s near BBG

AUD:

Domain enters full blown house price panic MB

Sellers with FONGO (fear of not getting out before prices fall) race to beat property clock AFR

Australia banks solvency test highlight capital adequacy above CoCo BI

Banks big retreat may go too far, warn corporate advisers Luminis – AFR

EUR/GBP:

Teresa May’s Brexit disaster: The Prime Minister of humiliation Spiegel

To back the PM’s deal, we need proof that the next stage of Brexit talks will be radically different Telegraph

Some in cabinet do not believe in Brexit says David Davies – BBC

USD/CNY:

Trump-Xi meeting to end trade war may be pushed back to June SMP

US-China trade deal needs enforcement mechanisms Doud says BFW

NZD:

NZ economists lower 2019 GEP growth forecast to 2.8% – NZIER

NZ services industry expansion slowed in Feb – BFW

Today’s Data

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

JPY         Trade Balance (JPY) Feb A 0.12T | C 0.09T | P -0.37T | R -0.29T

GBP       Rightmove House Prices M/M Mar A 0.40% | P 0.70%

JPY         Industrial Production M/M Jan (F) A -3.40% | C -3.70% | P -3.70%

10:00     EUR        Eurozone Trade Balance (EUR) Jan C 17.2B | P 15.6B

12:30     CAD       International Securities Transactions (CAD) Jan P -18.96B

14:00     USD       NAHB Housing Market Index Mar C 63 | P 62

20:00     NZD       Westpac Consumer Confidence Q1 P 109.1

 

Weekend News

GBP:

Chancellor Hammond says not there yet on Brexit vote

May Scrambles to win support for the Brexit deal

Labour will force confidence motion if May’s deal fails Corbyn (again)

UK Government will only hold Brexit vote if it believes it can win Fox

EU war gaming for the collapse of May’s Government Observer

DUP’s price for supporting May’s Brexit deal, seat at trade talks Telegraph

Nick Boles MP quits local party over Brexit

CAD:

Stimulus budget on cards as Canada’s Liberals look to eclipse crisis

EUR:

Bank of Spain sees no risk of recession in Europe

Thousands of Catalan separatist supporters protest in Madrid

CNY:

China to prosecute top ranking Ulghur official for corruption

China banks have hidden wave of bade debt BBG opinion

EUR/GBP:

UK must take part in EU elections if Brexit delayed Austrian negotiator

EUR/RUB:

Russia says it will respond to ne EU sanctions

Harry Hindsight

• GBP: A reasonably choppy day with soundbites the rule for the day, opening around the 1.3235 areas the market made quick headway through to the 1.3260 level before stalling and drifting through into the Tokyo session and holding in the 1.3235-50 areas for the most part, the move into the grey hours saw early London selling setting the low just above the 1.3200 area before starting a slow steady recovery and push through to the 1.3275 areas, the market again drifted a little for the move into the NYK session and selling taking the market through to the opening levels a quick move through the 1.3275 areas and pushing late into the session to hold just below the 1.3300 level and drifting to the close.
• JPY: Opening around the 111.65 levels the market edged higher through into the Tokyo session pushing quickly on the opening to test through to the 111.90 levels and the highs for the day after some demand for the fixing, having held around the 111.90 areas for an hour or so the market dropped back quickly falling back to the 111.50 areas, the market recovered a little pushing through to the 111.70 areas to hold through to the NYK session before the sellers returned for a steady dip through to the 111.40 level to make the lows just beyond and holding the 111.50 level through to the close.
• AUD: A quiet range through the whole day lifting from the opening 0.7060 areas and testing through in early Tokyo to push lightly through the 0.7090 areas and while the high was increase to the 0.7096 area into NYK the high in each session was little different, London tested the market back to the 0.7070 into NYK however the market remained around the 0.7080-90 levels for the most part.
• EUR: Euro’s rose in early Tokyo from the opening around the 1.1304 level to test above the 1.1320 area and then hold through to the NYK session before making the lows from the opening and then rallying quickly off the 1.1300 area through to the 1.1344 level for the range of the day drifting back for the move into the close around the 1.1320 areas.

Yesterday’s Premiership results

JPY         BoJ Rate Decision A | C -0.10% | P -0.10%

NZD       BusinessNZ Manufacturing PMI Feb A 53.7 | P 53.1 | R 53

EUR        Eurozone CPI M/M Feb A 0.30% | C 0.30% | P -1.00%

EUR        Eurozone CPI Y/Y Feb (F) 1.50% | C 1.50% | P 1.40%

EUR        Eurozone CPI Core Y/Y Feb (F) A 1.00% | C 1.00% | P 1.00% | R 1.10%

CAD       Manufacturing Sales M/M Jan A 1.00% | C 0.40% | P -1.30% | R -1.10%

USD       Empire State Manufacturing Index Mar A 3.7 | C 10 | P 8.8

USD       Industrial Production M/M Feb A 0.10% | C 0.40% | P -0.60% | R -0.40%

USD       Capacity Utilization Feb A 78.20% | C 78.50% | P 78.20% | R 78.30%

USD       U. of Mich. Sentiment Mar (P) A 97.8 | C 95.6 | P 93.8

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