Daily FX Market Commentary

Andy Harrison

Good Morning,

LMAX Close

USDJPY 109.594 | EURUSD 1.12015 | AUDUSD 0.69289| NZDUSD 0.65612 | USDCAD 1.34373 | USDCHF 1.00871 | GBPUSD 1.28459 |

LMAX highs and Lows 05.00 GMT

                                Highs | Lows

EURUSD               1.12099 | 1.1202

USDJPY                 109.581 | 109.336

GBPUSD               1.28517 | 1.28419

USDCHF               1.00858 | 1.00774

AUDUSD              0.69295 | 0.68927

USDCAD               1.34497 | 1.34358

NZDUSD               0.65661 | 0.65486

EURCHF                1.13060 | 1.12936

EURGBP               0.87270 | 0.87214

EURJPY                 122.797 | 122.546

For Today

• GBP: Another slow run through the Asian session with the market holding for the most part in the 1.2845-50 areas through to the grey hour, downside bids likely to be congestive in nature with the market around the 1.2800 level likely to be strongest with a push through the level likely to meet more supportive bids through to the 1.2765 areas and an old trendline, possible weak stops through the 1.2800 area will likely struggle with those bids and deflect the market for the immediate future and push through the congestion and a break through 1.2750 areas is likely to open a deeper movement with limited congestion into the 1.2700 levels and then the breakdown point from January in focus.
• JPY: Opening around the 109.60 area the market slid slowly through early Tokyo to test to the 109.35 level holding for a couple of hours before slowly rising through to the 109.50 for the move into the grey hour, Downside bids strong into the 109.00 levels with possible stronger stops on a move through the 108.80 areas with stronger bids through into the 108.50 level and increasing congestion through the downside through to the 108.00 level and the lows from the beginning of the year, topside offers light through to the 110.00 levels with weak stops pushing through the 110.20 areas and opening the possibility of a small squeeze through to the 111.00 areas where stronger offers reappear.
• AUD: The market opened around the 0.6930 level making the early high just above the level before slowly slipping through to the 0.6920 areas and into the employment numbers, while the headline number suggests one thing the actual numbers in whole tell a different story with less jobs actually showing in the numbers and therefore revising last month employment number and another rise for this month, the market dropped quickly through the 69 cents level before bouncing and holding in the 0.6910-20 areas for the run to the grey hour, downside congestion mostly around the sentimental levels with possible stronger bids concentrated around the 69 cents level before opening the chance of testing to the 0.6800 area and the lows from early this year and the area that the market rose from in 2016. Topside offers likely to be weak through to the 70 cents level with some congestion and stops through the 0.7020 level and opening the market to stronger congestion on a move to the 0.7050 areas and continuing into a crowded 0.7050-0.7100 areas.
• EUR: Very quiet session with the largest move down to the AUD employment numbers, rising from the opening around the 1.1205 area the market pushed through towards the 1.1210 level with one minor dip back to the 1.1202 area before holding through to the grey hour, congestion through the 1.1240-60 and increasing into the 1.1280 areas with stronger offers through the 1.1300-20 level with weak stops likely to be through the level any stops are likely to find congestion continuing through the 1.1340-6t0 areas and continuing through to the stronger 1.1400 areas, downside bids likely to be limited through to the 1.1200 areas with weak congestion likely through to the 1.1150 area and opening a renewed test to the 1.1120 level with stronger bids in the area, any push through to the 1.1080 level is possibly opening the market to a deeper move.

Overnight News

USD/CNY:

How the trade war is playing into the interests of both Trump and Xi CNBC

American oil heads to new customers as China pulls back – BBG

CNY/USD:

People’s daily says US uses gangster logic in trade talks

China’s share of all treasury holdings continues to slide BBG

CNY:

Fear drives Chinese to buy Bitcoin Forbes

USD:

White House reviews Military plans against Iran, in echoes of Iraq war NYT

EUR:

ECB’s Coeure says negative rates are peanuts among bank woes BBG

Germany risks being left high and dry as economy stutters – Telegraph

GBP:

Brexit party becomes fastest growing party in modern British political history Telegraph

CHF:

Higher SNB rates would put pressure on CHF BBG

AUD:

Labour data creates headaches for the RBA

AUD threatens financial crisis levels – DJ

Today’s Data

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

JPY         Domestic CGPI Y/Y Apr A 1.20% | C 1.10% | P 1.30%

JPY         Domestic Corporate Goods Price Index M/M Apr A 0.30% | C 0.20% | P 0.30%

AUD       Consumer Inflation Expectation May A 3.30% | P 3.90%

AUD       Employment Change Apr A 28.4K | C 15.2K | P 25.7K | R 27.7K

AUD       Unemployment Rate Apr A 5.20% | C 5.00% | P 5.00% | R 5.10%

09:00     EUR        Eurozone Trade Balance (EUR) Mar C 19.0B | P 19.5B

12:30     CAD       International Securities Transactions (CAD) Mar P 12.05B

12:30     CAD       Manufacturing Sales M/M Mar C 1.50% | P -0.20%

12:30     USD       Housing Starts Apr C 1.21M | P 1.14M

12:30     USD       Building Permits Apr C 1.29M | P 1.29M

12:30     USD       Philadelphia Fed Business Outlook May C 9 | P 8.5

12:30     USD       Initial Jobless Claims (MAY 11) C 220K | P 228K

14:30     USD       Natural Gas Storage P 85B

22:30     NZD       BusinessNZ Manufacturing PMI Apr P 51.9

22:45     NZD       PPI Input Q/Q Q1 P 1.60%

22:45     NZD       PPI Output Q/Q Q1 P 0.80%

Harry Hindsight

 

• GBP: Ranging quietly through the Asian session the market held around the opening 1.2910 level holding for the most part above the 1.2905 area and rising through to test the 1.2920 levels several times through to the grey hour before the market dropped off into the grey hour to push lightly through the 1.2900 level, London were quick buyers to take the market to the highs of the day and only just above the 1.2920 areas before drifting through to the NYK session and selling moving in strongly to push through the bids and test through to the 1.2825 levels before bouncing and testing back to the 1.2880 level however, having pushed to the level the market drifted through the session once London had left the building and pushed back to the sub 1.2850 areas for a long drawn out move to the close.
• JPY: USDJPY opened around the 109.60 area and a slow climb through into the Tokyo session to test towards the 109.70 level before dropping off quickly through to the 109.50 areas holding for a short period before recovering and ranging in the opening area levels through to the grey hour with light buying testing the 109.70 and creating the high for the day, the market dropped from the opening in London testing steadily through to the 109.30 levels in steps before briefly holding through to the NYK session, strong GBPJPY selling was seen through the move lower testing through the 109.20 levels before bouncing off the lows to push higher and back to the opening levels, with limited movement through to the close.
• AUD: Overall a steady session for the beleaguered Oz drifting into early Tokyo the market saw weaker consumer confidence numbers and dipped through from the 0.6945 area to the 0.6930 level and traded narrowly around the level through into the London session, and slow test of the 0.6920 areas and ranging through to the NYK session in that level the market saw a move through to the 0.6930 levels for a range around the area to the close.
• EUR: Opening around the 1.1205 areas the market struggled in a tight range through to the grey hours unable to test the 1.1200 level and struggling on each attempt to the 1.1210 level before dipping away for the first test of the 1.1200 level in the grey hour, London bought the market up through the 1.1215 areas with German GDP in line with expectations before dropping lower with unchanged GDP numbers for the Eurozone and the market moving through to the NYK session testing the 1.1180 level, the run through the NYK session was quiet initially weaker retail sales, industrial production eventually filtered through into the market and the Euro rising again and pushing through to make the highs just through the 1.1220 area before returning to the opening levels and a long steady run to the close.

Yesterday’s Premiership results

JPY         Japan Money Stock M2+CD Y/Y Apr A 2.60% | C 2.30% | P 2.40%

AUD       Westpac Consumer Confidence May A 0.60% | P 1.90%

AUD       Wage Price Index Q/Q Q1 A 0.50% | C 0.60% | P 0.50%

CNY        Fixed Assets Ex Rural YTD Y/Y Apr A 6.10% | C 6.40% | P 6.30%

CNY        Industrial Production Y/Y Apr A 5.40% | C 6.50% | P 8.50%

CNY        Retail Sales Y/Y Apr A 7.20% | C 8.60% | P 8.70%

CNY        Surveyed Jobless Rate Apr A 5.00% | P 5.20%

JPY         Machine Tool Orders Y/Y Q1 Apr (P) A -33.40% | P -28.50%

EUR        German GDP Q/Q Q1 (P) A 0.40% | C 0.40% | P 0.00%

EUR        Eurozone Employment Q/Q Q1 (P) A 0.30% | C 0.20% | P 0.30%

EUR        Eurozone GDP Q/Q Q1 (P) A 0.40% | C 0.40% | P 0.40%

CAD       CPI M/M Apr A 0.40% | C 0.40% | P 0.70%

CAD       CPI Y/Y Apr A 2.00% | C 2.00% | P 1.90%

CAD       CPI Core – Common Y/Y Apr A 1.80% | C 1.80% | P 1.80%

CAD       CPI Core – Median Y/Y Apr A 1.90% | C 2.00% | P 2.00%

CAD       CPI Core – Trim Y/Y Apr A 2.00% | C 2.10% | P 2.10%

USD       Empire State Manufacturing May A 17.8 | C 8 | P 10.1

USD       Retail Sales Advance M/M Apr A -0.20% | C 0.20% | P 1.60% | R 1.70%

USD       Retail Sales Ex Auto M/M Apr A 0.10% | C 0.70% | P 1.20% | R 1.30%

USD       Industrial Production M/M Apr A -0.50% | C 0.00% | P -0.10% | R 0.20%

USD       Capacity Utilization Apr A 77.90% | C 78.70% | P 78.80% | R 78.50%

USD       NAHB Housing Market Index May A 66 | C 64 | P 63

 

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