Daily FX Market Commentary

Andy Harrison

Good Morning,

LMAX Close

USDJPY 110.066 | EURUSD 1.11572 | AUDUSD 0.68677 | NZDUSD 0.65159 | USDCAD 1.34659 | USDCHF 1.01108 | GBPUSD 1.27178 |

LMAX highs and Lows 05.00 GMT

                                Highs | Lows

EURUSD               1.11677 | 1.11529

USDJPY                 110.318 | 110.116

GBPUSD               1.27541 | 1.27261

USDCHF               1.01200 | 1.01024

AUDUSD              0.69204 | 0.6882

USDCAD               1.34564 | 1.34298

NZDUSD               0.65412 | 0.65208

EURCHF                1.12930 | 1.1276

EURGBP               0.87745 | 0.87577

EURJPY                 123.190 | 122.824

For Today

• GBP: Premarket looked to be unchanged however, the opening saw a quick move through the 1.2740 level to set the high for the day before drifting a little through to the 1.2725 areas for a long drawn out push through to the Tokyo session before attempting a fresh move to the topside, by midsession the market had again drifted back to the 1.2730 levels for the move through into the grey hour, downside bids light through the 1.2700 areas with possible weak stops on any dip through the level to open the market to limited congestion through to the stronger 1.2630 areas, any break beyond here opens a deeper move towards the 1.2500 level before stronger bids make an appearance. Topside offers light back through the 1.2800 level with the chance of a small squeeze higher with a little congestion through to the 1.2850 areas before stronger resistance is expected, a break of the 1.2900 level will likely see stronger buying appearing and the market pushing for the 1.3000 level where the likelihood of strong offers appears.
• JPY: Opening a tiny bit higher the market dipped from the early 110.15 level to fill the small gap on the charts and setting the low just above the 110.00 level before moving into the Tokyo session, Tokyo were steady buyers through to just above the 110.30 level before running out of steam and slipping slowly back to the 110.20 areas 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 110.50 levels and likely to see stronger congestion through to the 110.80 and strong offers from there through to the 111.20 level and weak stops on a break through that level.
• AUD: The expected result for the Oz elections saw all the main stream media wrong for a change or lost for words, with the Conservatives taking the day the market opened some 40 pips higher around the 0.6900 area and then testing back to the 0.6890 level before moving into the Tokyo session and a strong steady rise through to the 0.6920 level and holding close to the level into the grey hour, topside weak stops likely through the current highs and then opening to a quick test to the 0.6940-60 resistance level, any push through this level and the market is likely to find further offers with the economy really unchanged and the new government with a lot to do. Downside bids light through to the 0.6860 level with sentimental bids likely through to the 0.6820 area where stronger bids are likely to appear with increasing bids through to the 0.6780 level before weak stops appear.
• EUR: Opening a touch stronger the Euro headed to test above the 1.1165 level before holding in a tight range to deep into the Tokyo session, midsession saw the Euro suffering a little and drifting steadily through the 1.1155 level to hold through to the grey hour just below that level. Light offers into the 1.1200 areas then sees congestion concentrated around 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 1.1140 areas with weak congestion likely through to the 1.1120 level and into the 1.1080 level with weak stops opening the market to a deeper move.

Overnight News

CNY:

China’s battered Yuan faces $19B dividend blow BBG

USD:

US warship sails in disputed S. China sea amid trade tensions

AUD:

Australia’s shock election shows killing coal mining is not sure thing

Today’s Data

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

GBP       Rightmove House Prices M/M May A 0.90% | P 1.10%

GBP       Rightmove House Prices Y/Y May A 0.10% | P -0.10%

JPY         GDP Q/Q Q1 (P) A 0.50% | C -0.10% | P 0.50%

JPY         GDP Deflator Y/Y Q1 (P) A 0.20% | C 0.20% | P -0.30%

JPY         Industrial Production M/M Mar (F) A -0.60% | P -0.90%

06:00     EUR        German PPI M/M Apr C 0.30% | P -0.10%

06:00     EUR        German PPI Y/Y Apr C 2.40% | P 2.40%

08:00     EUR        Eurozone Current Account (EUR) Mar C 24.2B | P 26.8B

Weekend news

 

CNY: China may raise limit on insurers stock buying China fund news

Weekend China press hints at currency intervention ForexLive

China resolutely opposes these US actions and warns the US not to go too far

Trade dispute must be resolved through negotiation on an equal footing

Urges US to abide by the one China principle and take care with how it handles Taiwan related issues

EUR:

ECB’s Knot says Eurozone inflation is not where ECB wants it RTRS

Austria to hold snap, elections – ORF

USD:

Trump says if Iran want to fight will be its official end

Trump never threaten the US again

China trade turmoil makes US investors nervous WSJ

EU, Japan reprieve from Trump car tariffs may be short lived BBG

Trump escalates Chine trade dispute, economic ties lose stabilizing force – WP

AUD:

Conservatives ride economy to unwinnable election BBG

JPY/USD:

Toyota says Trump sent message carmaker not welcome

NZD:

NZ Services industry growth slowed further in April

 

Harry Hindsight

 

• GBP: A quiet drift through the Asian session saw the market probing into the 1.2780’s but with very little impetus or urgency to test the downside, the move through to the grey hour and the London opening saw the market testing lightly through the lows and breaking eventually through to the 1.2760 level before drifting to the next level and holding the 1.2750 level into the NYK session, a quick break lower with early NYK sellers before again returning to the 1.2750 level holding quietly before slipping back to the 1.2735 level and a steady drift to the lows of the day and the close just off the 1.2715 level.
• JPY: A slow range into the Tokyo session bolding around the opening 109.85 level before slowly testing through the 110.00 areas in a light test through, having tested the level the market drifted through the session with US/CNY trade spat dominating the market, USDJPY steadily drifted to the opening level and a quick dip to the 109.75 areas with weak stops helping the small dip and pushing through to the Tokyo session slowly pushing through to the 109.60 areas and basing around the level through to the NYK session where early fresh selling saw the market dipping to its lows and testing the 109.50 level, the move into the NYK session saw the market moving off the lows and a steady rise through to the 110.00 level with strong buying, stalling again the market drifted a little before running again and this time triggering some weak stops on a quick test towards the 110.20 level and then holding above the 110.00 level through to the close.
• AUD: Opening around the 0.6890 level the market held around the level through to deep into the London session drifting from the opening to test through to the 0.6885 area and then rising to the 0.6896 level to make the high of the day, the move towards the Tokyo Lunch saw the market sagging and testing the 0.6880 level before recovering for the run to London with grey hour buying pushing the market back towards the highs, eventually though with Australians voting and the market expecting the Liberals to win the Oz started to drift again and steadily moved to the 0.6870 level and dipping through the level for the final couple of hours to make the lows around the 0.6865 level.
• EUR: Euro had a reasonably quiet day with the market moving through from the opening holding around the 1.1175 area and then pushing for the 1.1180 level for the move into the grey hour, a quick burst to the topside saw the high of the day just short of the 1.1185 level before slow steady selling saw the market back through to the 1.1170 levels a dip below the level saw some strong selling through to the 1.1160 level and the market based along that line for several hours, with minor dips through the level before moving into NYK and the US numbers saw some strong USD buying and pushing the Euro to the 1.1155 area and the lows of the day ranging through a 15 point range to the close from that level and finishing just off that low.

Yesterday’s Premiership results

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%

EUR        Eurozone CPI M/M Apr A 0.70% | C 0.70% | P 1.00%

EUR        Eurozone CPI Y/Y Apr (F) A 1.70% | C 1.70% | P 1.40%

EUR        Eurozone CPI Core Y/Y Apr (F) A 1.30% | C 1.20% | P 1.20%

USD       Leading Index Apr A 0.20% | C 0.20% | P 0.40%

USD       U. of Mich. Sentiment May (P) A 102.4 | C 97.5 | P 97.2

 

Any opinions, news, research, analyses, prices or other information contained on this Blog, whether by LMAX, its employees, partners or contributors, does not constitute investment advice nor has it been prepared in accordance with legal requirements designed to promote the independence of investment research. Further, the material contained within this Blog does not contain (and should not be construed as containing) investment advice or an investment recommendation, or an offer of, or solicitation for, a transaction in any financial instrument. Whilst information provided on this Blog may help with your investment research you must consider carefully whether you should make (or refrain from making) investment or other decisions based on what you see without doing further research on the investments you are interested in. Participating in this Blog cannot be a substitute for obtaining advice from an appropriate expert independent adviser who takes into account your circumstances and specific investment needs in selected investments that are appropriate for you. LMAX has not verified the accuracy or basis-in-fact of any claim or statement made by any third parties as comments for every Blog entry.

LMAX 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 material produced in this Blog was obtained from sources deemed to be reliable, LMAX 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.

If you currently hold an account with LMAX for the purposes of trading FX and CFD’s, you are encouraged to use a different Username and Password to access the Blog or any other online systems. The Blog is a place to learn, discuss and share information and ideas with Blog followers. It is not a place to slander, use unacceptable language or to promote LMAX or any other FX, Spread Betting 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.