Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good Morning,

LMAX Close

USDJPY 107.235 | EURUSD 1.1047 | AUDUSD 0.68631 | NZDUSD 0.64251 | USDCAD 1.31693 | USDCHF 0.99211 | GBPUSD 1.23453 |

 

LMAX highs and Lows 05.00 GMT

                                Highs | Lows

EURUSD               1.10533 | 1.10402

USDJPY                107.500 | 107.184

GBPUSD              1.23592 | 1.23359

USDCHF               0.99301 | 0.99143

AUDUSD             0.68680 | 0.68504

USDCAD              1.31779 | 1.31642

NZDUSD              0.64410 | 0.64267

EURCHF               1.09679 | 1.09544

EURGBP              0.89521 | 0.89446

EURJPY                118.740 | 118.396

 

For Today

  • GBP: Another quiet day in Asia with the Cable opening just below the 1.2350 level and making early gains to above the level before moving into the Tokyo session drifting back to the 1.2335 level and holding around the 1.2340 level through into the grey hour, Topside congestion through the current levels with possible weak stops around the 1.2370 area and limited offers into the 1.2400 area and light congestion likely through the sentimental areas for any move to the stronger 1.2500 level. Downside congestion light through to the 1.2200 level and a little stronger on any test through before stronger bids start to appear on any attempt at the 1.2150 level notwithstanding Brexit news. A test through the level is likely to see varying degrees of strength with no real stops until below the 1.2100 area.
  • JPY: A limited rise through the session having dip a touch from the opening to test lightly through the 107.20 area and then one way traffic for the move through the first few hours in Tokyo rising to touch just above the 107.50 areas before drifting to the 107.40 level for the move into the grey hour, congestion into the current highs with possibility of weak stops on a move through with stronger offers the closer the market moves to the 108.00 level and congestion likely through the level, downside bids light through the 107.00 level with congestion likely in the 106.60-40 areas and bids likely to increase through the 106.20-105.80 areas.
  • AUD: Limited range through into the Tokyo session with the market opening around the 0.6865 level and holding around the level deep into Tokyo testing towards the 0.6870 levels before dropping off sharply with sellers taking the market through to the 0.6855 area with one dip to 0.6850 before holding around the 0.6855 area rising slowly to the grey hour. downside bids likely to forming around the 0.6800 areas and increasing through to the 0.6780 level, a break through the level is likely to see weak stops appearing and the market open to a move back through to the stronger 0.6720 levels., Topside offers into the 0.6880 level likely to be strong and continuing through the 69 cents level before weak stops appear on any test through the 0.6920 areas with light congestion then continuing through the level into 0.6960 areas before increasing.
  • EUR: Early highs before entering the Tokyo session testing just through the 1.1050 level before drifting back towards the 1.1040 area and holding through the session in a tight range, downside bids into the 1.0920 level and likely to continue through to the 1.0880 level however, congestion is then likely to start increasing as the market moves into the mid ranges from 2015-16 with limited bids until 1.0800,Topside offers through the 1.1040-60 area with increasing congestion on a test to the 1.1100 areas, weak stops likely on a break of the 1.1120 level and the market then running to weaker congestion into the 1.1140-60 and increasing on any move to the 1.1180 level.

 

Overnight News

GBP:

UK PM says I don’t want an election, but it is the only way to break the deadlock – BBG

UK PM: Opposition Labour party have a constitutional duty to seek to replace the Government – BBG

UK PM asks are there legal grounds to compel labour to agree to elections – BBG

UK PM let the people decide if they want to delay Brexit – BBG

UK PM I will not ask for Brexit delay – BBG

UK Parliament again rejects Johnson bid for early election with opposition party declining to vote

NZD:

NZ traffic gauge signals weak GDP outlook – ANZ

EUR:

Euro gains on hopes of German fiscal stimulus – HAA

BMW and co are losing their allure and that’s got Germany worried – BBG

AUD:

Bubbling Australian housing brings headache for RBA – DJ

How a consumer go slow and a pile of debt is killing the economy – ABC Aus

Australian business gloom deepens as stimulus fails to fire – BBG

CHF:

SNB scaled back intervention likely on temporarily receding macro pressure

CNY:

Chinese state-run paper singles out Navvarro for trade lies

Fitch downgrateds China growth darkens global outlook

Fitch: Protectionism choking global growth prospects

Fitch: China’s growth rate is now expected to fall to 6.1% in 2019 and 5.7% in 2020 down from 6.2 and 6.0% respectively

CNY/USD:

US must concede final 20 % to agree trade war deal with China – SCMP

China hopes US can create conditions for trade talks – BBG

DIGITAL:

Cryptonews: Facebook may omit Yuan from Libra reserve, tethers CNH+pegged coin – WE9

 

 

Today’s Data

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

CNY        Consumer Price Index (YoY) (AUG) A 2.8% | C 2.7% | P 2.8%

CNY        Producer Price Index (YoY) (AUG) A -0.8% | C -0.9% | P -0.3%

AUD       NAB Business Confidence (AUG) A 1 | P 4

06:00     JPY         Machine Tool Orders (YoY) (AUG P) P -33.0%

08:30     GBP        Claimant Count Rate (AUG) P 3.2%

08:30     GBP        Jobless Claims Change (AUG) P 28.0k

08:30     GBP        Average Weekly Earnings (3M/YoY) (JUL) C 3.7% | P 3.7%

08:30     GBP        Weekly Earnings ex Bonus (3M/YoY) (JUL) C 3.7% | P 3.9%

08:30     GBP        ILO Unemployment Rate 3Mths (JUL) C 3.9% | P 3.9%

08:30     GBP        Employment Change 3M/3M (JUL) C 55k | P 115k

12:15     CAD       Housing Starts (AUG) P 222.0k

12:30     CAD       Building Permits (MoM) (JUL) P -3.7%

 

Harry Hindsight

 

  • GBP: A dip on the opening saw the market drop from the 1.2285 level through to the 1.2270 before starting a slow recovery through the early part of the session to push into Tokyo just above the opening levels, the market traded through the bulk of Asia in a very narrow range and started to fall away as the market moved into the grey hour and fell into the London opening to make the lows of the day testing just below the 1.2240 level before starting a steady reversal with better numbers pushing through the opening level in the first hour and pushing through the 1.2300 areas with little fuss and steadily testing through the 1.2350 before slowing, weak stops saw the market spike through to the 1.2385 level before settling down around the 1.2365 areas, a minor dip on the NYK option cut taking the market through to the 1.2320 area before again rising to the 1.2350 level and a slow drift through to the close.
  • JPY: A slow but steady rise through the day, opening around the 106.85-106.90 level in and illiquid opening saw the market move higher as the Tokyo session started and almost one way traffic through the 107.00, the market dropped back into midsession testing quickly through the 106.80 level to set the lows before recovering and holding around the 106.90 area through to the London session, a steady rise through London testing through to the 107.05 areas before drifting for an hour or so into the NYK session before starting to rise again, NYK option cut out of the way saw the market dipping back through the London close in a quick move back below the 107.00 level again before rallying steadily through to the close to finish just above the 107.20’s.
  • AUD: Little choppy on the opening ranging to 0.6840 through to the 0.6850 before settling into a tight range around the 0.6845 levels, a few hours into the Tokyo session saw minor selling through to the 0.6835 areas before recovering through to the 0.6850 level and slowly pushing to above the 0.6855 level and ranging above the level through to the London session and holding quietly in a quiet range for a few hours before pushing through the 0.6860 level and triggering some weak stops on a move to the 0.6870 level, movement slowed and a rising tight range testing just through the 0.6875 level before drifting off for the move through to the close.
  • EUR: Opening around the 1.1025 level and a slow drift through into the Tokyo session to make the lows in early morning trading, before lifting off the mid-teens and trading a little quicker testing to the 1.1030 areas and holding around the area through into the early part of London before starting a rise through to the 1.1040 level into early London morning, it was short lived and dropped back quicker than it went up, the market then rose back a little and the move into the NYK session saw renewed buying entering the market and a quick push towards the 1.1060 level before dropping back and taking a greater period of time before pushing through to make the highs just short of the 1.1070 levels, once those highs were made the market slipped lower pushing through the 1.1050 level.

 

Yesterday’s Premiership results

CNY        Trade Balance (AUG) A $34.84b | C $42.80b | P $44.58b

CNY        Trade Balance CNY (AUG) A 239.60b | C 299.30b | P 310.26b

JPY         Trade Balance – BOP Basis (Yen) (JUL) A -¥74.5b | C -¥31.0b | P   ¥759.3b

JPY         Gross Domestic Product Annualized s.a. (QoQ) (2Q F) A 1.3% | C 1.3% | P 1.8%

JPY         Bank Lending Ex-Trusts (YoY) (AUG) A 2.2% | P 2.5% | R 2.4%

JPY         Bank Lending incl Trusts (YoY) (AUG) A 2.1% | P 2.3%

AUD       Home Loans (MoM) (JUL) A 4.2% | C 1.3% | P 0.4%

JPY         Eco Watchers Survey Current (AUG) A 42.8 | C 41.3 | P 41.2

CHF        Unemployment Rate (AUG) A 2.1% | P 2.1%

CHF        Unemployment Rate s.a. (AUG) A 2.3% | C 2.3% | P 2.3%

EUR        German Trade Balance (JUL) A 21.4b | P 16.8b

GBP        BOE’s Vlieghe Speaks in London

GBP        Monthly GDP (3M/3M) (JUL) A 0.0% | C -0.1% | C -0.2%

GBP        Monthly GDP (MoM) (JUL) A 0.3% | C 0.1% | P 0.0%

GBP        Industrial Production (YoY) (JUL) A -0.9% | C -1.0% | P -0.6%

GBP        Manufacturing Production (YoY) (JUL) A -0.6% | C -1.0% | P -1.4%

GBP       Construction Output (YoY) (JUL) A 0.3% | P -0.2%

GBP        Visible Trade Balance (Pounds) (JUL) A -£9144m | C -9500m | P -£7009m | R -£8920m

GBP        Trade Balance Non EU GBP/Mn (JUL) A -1932m | C -£3000m | P -£186m | R -£1771m

MXN      CPI (MoM) (AUG) A -0.02% | C -0.02% | P 0.38%

MXN      CPI Core (MoM) (AUG) A 0.20% | C 0.19% | P 0.26%

MXN      CPI (YoY) (AUG) A 3.16% | C 3.16% | P 3.78%

USD        Consumer Credit (JUL) A $23.294b | C $16.300b | P $14.596b | R $13.781b

 

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.

Any opinions, news, research, analyses, prices or other information ("information") contained on this Blog, constitutes marketing communication and it has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Further, the information 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. LMAX Exchange 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 Exchange 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 produced information was obtained from sources deemed to be reliable, LMAX Exchange 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. It is not a place to slander, use unacceptable language or to promote LMAX Exchange 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.

LMAX Exchange will clearly identify and mark any content it publishes or that is approved by LMAX Exchange.

FX and CFDs are leveraged products that can result in losses exceeding your deposit. They are not suitable for everyone so please ensure you fully understand the risks involved. The information on this website is not directed at residents of the United States of America, Australia (we will only deal with Australian clients who are "wholesale clients" as defined under the Corporations Act 2001), Canada (although we may deal with Canadian residents who meet the "Permitted Client" criteria), Singapore or any other jurisdiction where FX trading and/or CFD trading is restricted or prohibited by local laws or regulations.