Daily FX Market Commentary

Andy Harrison

Good Morning,

LMAX Close

USDJPY 109.846 | EURUSD 1.11738 | AUDUSD 0.6892 | NZDUSD 0.65362 | USDCAD 1.34614 | USDCHF 1.00995 | GBPUSD 1.27982 |

LMAX highs and Lows 05.00 GMT

                                Highs | Lows

EURUSD               1.11800 | 1.11707

USDJPY                 110.036 | 109.676

GBPUSD               1.27981 | 1.27823

USDCHF               1.01046 | 1.0088

AUDUSD              0.68974 | 0.68835

USDCAD               1.34734 | 1.34573

NZDUSD               0.65427 | 0.65274

EURCHF                1.12906 | 1.12777

EURGBP               0.87419 | 0.87314

EURJPY                 122.975 | 122.59

For Today

• GBP: Another quiet Asian session with the Cable moving quietly through to the Tokyo session around the 1.2795-98 level trading in the narrow band for several hours before dipping away from the Tokyo fix period to test towards the 1.2780 level before slowly recover to above the 1.2790 level and holding through to the grey hour. Downside bids remain convectively through to the stronger supportive bids through to the 1.2765 areas and an old trendline, possible weak stops through the 1.2750 area with a possibility of weak stops on a move down through the level and weakness continuing into the 1.2700 area likely to be limited and sentimental only and the market then opening to a deeper move with limited congestion down through to the 1.2630 area before increasing interest appears. Topside offers light through to the 1.2850 areas with some limited congestion then continuing through to the 1.2900 areas, weak stops possibly on a push through the 1.2920 area with congestion likely every 20 pips or so through to the 1.3000 level where offers are likely to be stronger.
• JPY: A quiet rise once the market moved into the Tokyo session to test lightly above the 110.00 area before slowly but steadily dropping back to the opening 109.80 areas and triggering some weak stops on the push through and then holding the 109.70 area 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: A quiet session but again another little step lower with the Oz opening around the 0.6890 level and drifting into the 0.6880’s recovering on a weak push towards 69 cents before extending the lows into the low 0.6880’s and holding quietly through to the grey hour, A lot of the downside congestion now cleared but bids remain in the current levels a push through to the 0.6820-00 area is likely to see some strong bids appearing and continuing through onto the 0.67 handle, weak stops are likely on a push beyond the 0.6780 level however, stronger bids around the lows from January are likely to hold the market for the short term but 67 cent level looking vulnerable, 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: A run to the 1.1170 areas saw the market slowly lifting from the level and head slowly towards the 1.1180 area in quiet trading and holding tightly just below the level for a long drawn out range 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

AUD:

Oz has little scope after vote BBG

NZD:

RBNZ revokes ANZ NZ’s accreditation to model risk capital BBG

RBNZ Cites persistent failure of controls, attestation

RBNZ censures ANZ bank NZ

JPY:

Moody’s changes outlook on Japan banking system to negative BBG

USD/TRY:

US terminating Turkey’s preferential trade treatment under GSP effective on Friday White House

White House issues notice on Turkey metal tariff’s

EM:

Where has all the money gone after trade war triggers capital flight from emerging Asian markets SCMP

CNY:

China cannot weaponize US bond sales without shooting itself in the head Telegraph

Pres. Xi wants China to play a bigger role in the world Trivium

China not interested in talking with US for now State Media

EUR:

Salvini says, Italy needs a Trump like shock, ignoring rules – BBG

CAD:

Poloz says easing of Financial conditions is increasing risks BBG

GBP:

Tories force PM May to call time on failing Brexit leadership – BBG

Today’s Data

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

NZD       BusinessNZ Manufacturing PMI Apr A 53 | P 51.9 | R 52

NZD       PPI Input Q/Q Q1 A -0.90% | P 1.60%

NZD       PPI Output Q/Q Q1 A -0.50% | P 0.80% | R 0.70%

JPY         Tertiary Industry Index M/M Mar A -0.40% | C 0.10% | P -0.60%

09:00     EUR        Eurozone CPI M/M Apr C 0.70% | P 1.00%

09:00     EUR        Eurozone CPI Y/Y Apr (F) C 1.70% | P 1.40%

09:00     EUR        Eurozone CPI Core Y/Y Apr (F) C 1.20% | P 1.20%

14:00     USD       Leading Index Apr C 0.20% | P 0.40%

14:00     USD       U. of Mich. Sentiment May (P) C 97.5 | P 97.2

Harry Hindsight

 

• GBP: A small range through the Asian session with the market rising a little from the opening around the 1.2845 level and testing through eventually to the 1.2850 area for the lead into the grey hour, early London were quick to start the selling with concerns for the roll of PM and ultimately the current Conservative government, the market dipped through to the 1.2820 levels in early trading in London then held steady for a short period before dipping away again for the move through into the NYK session with the market ranging around the 1.2800 levels through to the close of the day with the lows just through the 1.2790 area.
• JPY: Opening around the 109.60 areas the market started a slow steady drift through into the Tokyo session with the market basing around the 109.30 area with the market moving off the level after an hour or so to range quietly around the 109.50 area before running into the London session to test the downside again before starting a steady rally as the market rejected the level and pushed deep into the NYK session before running out of steam around the 109.95 level making the highs just beyond the level before drifting into the 109.85 areas for a quiet run to the close.
• AUD: A slow drift to the employment numbers having briefly tested through the 0.6920 area, the market saw the release of the data and dropped quickly back from the 0.6920 area to push to the 0.6890 areas before bouncing and heading back above the 69 cents level and holding quietly through to the London session, London were steady buyers pushing to the highs again but as with the JPY a long steady round of Oz selling saw the market running through to the Sydney opening and the 0.6890 level again before holding quietly to the close.
• EUR: A slow session for the Euro through Asia with the market slowly rising from the 1.1200 area to push quietly above the 1.1210 level into the grey hour, early London saw the highs pushing towards the 1.1225 level before USD buying moved through the market and the Euro pushed through into the NYK session testing through to the 1.1170 level and holding between the 1.1170-80 level through to the close.

Yesterday’s Premiership results

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%

EUR        Eurozone Trade Balance (EUR) Mar A 17.9B | C 19.0B | P 19.5B | R 20.6B

CAD       International Securities Transactions (CAD) Mar A -1.49B | P 12.05B | R 12.39B

CAD       Manufacturing Sales M/M Mar A 2.10% | C 1.50% | P -0.20%

USD       Housing Starts Apr A 1.24M | C 1.21M | P 1.14M | R 1.17M

USD       Building Permits Apr A 1.3M | C 1.29M | P 1.29M

USD       Philadelphia Fed Business Outlook May A 16.6 | C 9 | P 8.5

USD       Initial Jobless Claims (MAY 11) A 212K | C 220K | P 228K

USD       Natural Gas Storage A 106B | C 105B | P 85B

 

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