Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good Morning,

LMAX Close

USDJPY 105.754 | EURUSD 1.1090 | AUDUSD 0.67519 | NZDUSD 0.63621 | USDCAD 1.32846 | USDCHF 0.9813 | GBPUSD 1.22895 |

LMAX highs and Lows 05.00 GMT

                                Highs | Lows

EURUSD               1.10937 | 1.10844

USDJPY                105.892 | 105.651

GBPUSD              1.22919 | 1.22685

USDCHF               0.98220 | 0.98101

AUDUSD             0.67625 | 0.67359

USDCAD              1.33090 | 1.32816

NZDUSD              0.63655 | 0.63364

EURCHF               1.08868 | 1.08799

EURGBP              0.90373 | 0.9022

EURJPY                117.418 | 117.162

For Today

  • GBP: A slow drift from the opening trading quietly back to the 1.2270 areas and into the grey hour with very little movement, Topside offers look to be a little stronger into the 1.2300 areas before weak stops appear through the 1.2320 area and the market likely to find limited offers until the 1.2350 areas where stronger offers are likely to appear, downside bids congested back through the 1.2200 levels with particular strength on any dips to the 1.2140 level onwards and through to stronger bids below 1.2100 areas.
  • JPY: A limited range in the USDJPY with early Tokyo pushing the market through to the 105.65 areas before slowly recovering and trading through towards the 105.90 level to the grey hour, Downside bids starting to firm up around the 105.00 areas and increasing on any move to the 104.50 level with stops likely to not appear until through the 104.00 level and the likelihood of buyers willing to buy into any dips, whether or not the BoJ has interest or not and politically not the right idea for the time being, topside offers congested through the 106.40-60 areas, month end flows to come with stronger offers likely to reappear on any move to the 106.80 areas before weak stops opens the market through to the 107.50 areas.
  • AUD: Early trading took the market through the 0.6760 level into the midsession period before dropping back with the weaker construction numbers on a limited news day for the Oz testing through to the 0.6735 areas where the market held through to the London session, Downside bids likely to reappear around the 0.6700 level and then increasing as the market moves towards the 0.6680 area with possible strong stops through the  level opening a deeper move with limited congestion around the sentimental areas however, for the moment cross JPY has been dominating and the carry trade has all but disappeared, topside offers light through to the 0.6820-30 areas before weak stops appear and limited congestion for a move to the 69 cents level and stronger offers.
  • EUR: Opening just above the 1.1090 level to a meagre 1.1095 area before dropping back and moving through into the Tokyo session holding deep into the session above that opening level before quietly slipping through to the 1.1085 areas and the lows from yesterday, Downside congestion around the 1.1050 level with stronger bids on a push to the 1.1020-00 areas before limited bids appear through to the 109.80 and stronger stops appearing and minor support through the 1.09 handle, Topside offers into the 1.1180 level and likely to increase through to the 1.1220 level with congestion likely to continue through to the 1.1250 areas with weak stops in the mix, with further offers increasing into the 1.1280 areas.

 

 

Overnight News

NZD:

Kiwi channelling toward 62 cents amid sagging animal spirits as Orr gives it a shove on the RBNZ website – BBG

Orr: For small open economies like NZ the exchange rate plays a significant additional role in competitiveness – RBNZ

AUD:

RBA has blueprint for quantitative easing – DJ

Australia’s 2Q construction work -3.8% QoQ est. -1%

Costello frets on China economic risks – AFR

KRW:

Moon’s image as corruption fighter tarnished by aide’s scandal – Nikkei

GBP:

UK sees room for manoeuvre on Brexit after Merkel, Macron talks – BBG

Britain will be better off as a Junior partner of the US than an EU vassal – TEL

EUR;

Germany: GDP report shows building pressures –

Italian Deputy PM Di Maio (5 star): leadership will support new Govt. only if party members approve in online vote planned for next week

NOK:

Norway sovereign wealth fund advised to invest in more US stocks – swfinstitute

USD/OIL:

US Glut in Natural Gas supply goes global – DJ

API reports US Crude stockpiles fell 1.1m BBL last week

USD/CNY:

Call me maybe? Conflicting views show gap between US and China – NYT

Wary of Trump’s flip flop’s, China prepares for worst on trade – BBG

IMF:

IMF is in serious trouble in Argentina – BBG

USD:

Trump: FED loves watching our manufacturers struggle with their exports to the benefit of other parts of the world

Trump: Has anyone looked at what almost all other countries are doing to take advantage of good old USA

Trump: Our Fed has been calling it wrong for too long

CNY:

Parsing China’s coal imports shows steel, not utilities at risk – BBG

Trade insiders say Trump’s botching chances of a China deal – Politico

China to impose social credit system on foreign companies – FT

 

Today’s Data

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

GBP        Nationwide House Px n.s.a. (YoY) (AUG) A -0.4% | C 0.7% | P 0.3%

06:00     EUR        German Import Price Index (MoM) (JUL) C -0.1% | P -1.4%

06:00     EUR        German Import Price Index (YoY) (JUL) C -2.0% | P -2.0%

06:00     EUR        German GfK Consumer Confidence (SEP) C 9.6 | P 9.7

11:00     USD        MBA Mortgage Applications (AUG 23) P -0.9%

14:30     USD        DOE U.S. Crude Oil Inventories (AUG 23) P -2732k

23:50     JPY         Loans & Discounts Corp (YoY) (JUL) P 2.73%

 

Harry Hindsight

 

  • GBP: A quiet Asian session saw the market drifting from the opening around the 1.2225 level to test through into late Tokyo to the 1.2210 level before rising back to the opening levels for the move into the London session, rising steadily through the session as Brexit tacking in differing winds each day, the market steadily pushed through into the NYK session triggering weak stops on a spike through the 1.2300 level before falling back to the 1.2250 level into the NYK option cut before renewing its rise stalling this time around the 1.2300 area and not able to force its way to the 1.2310 level and a long drift through to the close.
  • JPY: Opening around the 106.10 level the market traded quietly before dipping away from the opening highs into the Tokyo fix pushing through the 105.90 level and briefly holding the 105.80 level, dropping through to the 105.75 quickly the market then drifting through into early morning extending the lows to the 105.60 level before starting a recovery with some GBPJPY buying heling the market back to the 105.85 areas and ranging around the level through into early NYK where buyers appeared and a return to the 106.00 area for a short period, London close saw the momentum lost and the market again pushing through towards the lows and finishing the day in a long run around the 105.75 area.
  • AUD: Steady selling throughout the Asian session saw the market touch the highs around the 0.6780 area before moving into Tokyo and the selling push through into midsession Tokyo to hold the 0.6770 areas for a short period the move towards the grey hour saw a little stronger selling and the 0.6760 level tested and the move into the London session completed the move to the lows testing the 0.6745 level before starting a slow reversal through the London morning however, while it regained the 0.6770 level into the NYK opening the sellers reappeared and once back to the 0.6750 area the market ran in a tight range for several hours and too the close.
  • EUR: For the most part a very quiet day for the Euro with the market opening around the 1.1100 area and holding through the Asian session with a paltry attempt through the 1.1105 area the only glimmer of a rally before dipping back to the figure and holding around the level into London, London were quiet buyers making the highs slowly through to the 1.1115 level and holding through to midday before dropping back to the figure level for the move into the NYK session and steady selling through to the 1.1085 areas and a quiet range through to the close.

 

Yesterday’s Premiership results

AUD       ANZ Weekly Consumer Confidence Index (AUG 25) A 114.1 | P 112.8

JPY         Corporate Service Price (YoY) (JUL) A 0.5% | C 0.6% | P 0.7%

EUR        German Gross Domestic Product n.s.a. (YoY) (2Q F) A 0.0% | C 0.0% | P 0.0%

EUR        German Gross Domestic Product w.d.a. (YoY) (2Q F) A 0.4% | C 0.4% | P 0.4%

GBP        BBA Loans for House Purchase (JUL) A 43342 | C 42854 | P 42653

USD        House Price Purchase Index (QoQ) (2Q) A 1.0% | C 0.2% | P 1.1% | R 1.3%

USD        House Price Index (MoM) (JUN) A 0.2% | C 0.2% | P 0.1% | R 0.2%

USD        S&P CoreLogic CS 20-City (MoM) SA (JUN) A 0.04% | C 0.1% | P 0.14% | R 0.13%

USD        S&P/Case-Shiller Composite-20 (YoY) (JUN) A 2.13% | C 2.4% | P 2.39% | R 2.37%

USD        S&P/Case-Shiller US Home Price Index (YoY) (JUN) A 3.13% | C 3.3% | P 3.43% | R 3.35%

USD        Consumer Confidence Index (AUG) A 135.1 | C 129 | P 135.7

USD        Conf. Board Present Situation (AUG) A 177.2 | P 170.9

 

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