Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good Morning,

LMAX Close
USDJPY 108.964 | EURUSD 1.10997 | AUDUSD 0.68385 | NZDUSD 0.63487 | USDCAD 1.3056 | USDCHF 0.99462 | GBPUSD 1.28595 |

LMAX highs and Lows 06.00 GMT
Highs | Lows
EURUSD 1.11028 | 1.10919
USDJPY 109.070 | 108.952
GBPUSD 1.28654 | 1.2836
USDCHF 0.99517 | 0.99439
AUDUSD 0.68556 | 0.6836
USDCAD 1.30598 | 1.30515
NZDUSD 0.63734 | 0.63468
EURCHF 1.10424 | 1.10326
EURGBP 0.86416 | 0.8623
EURJPY 121.029 | 120.882
For Today
• GBP: A quiet opening with the market rising initially to just above the 1.2860 level before dipping back to the opening levels before moving into the Tokyo session and a quick sell off through to the lows around 1.2835 area to make the lows before heading back through to the 1.2850’s again for the move into the grey hour, Topside offers light through the 1.2950 area however the closer you get to the 1.3000 area the stronger the offers begin to get, with stop losses likely on a push through the 1.3020 levels could see option related stops and the market quickly moving through to challenge the 1.3050 sentimental level and very little to slow a push higher especially on the back of any hopeful news, downside bids likely to be limited through the 1.2800 levels and with maybe weak stops on a dip through the 1.2750 areas the market could possibly see quick dips through to the light congestion around the sentimental levels to 1.2600 where possibly stiffer bids start to appear.
• JPY: A quiet range through the session with the market spiking on a single order type move through to the 109.06 area before dipping back to hold the 108.95-109.00 level through to the grey hour, Topside offers into the 109.00 level with limited resistance to a slight move through the level with increased offers likely to appear in the 109.20-40 areas before weak stops appear and opens the market to increasing congestion on any push through the 109.50 levels and increasing further on any push to the 110.00 level. Downside bids light back through the 108.00 areas with weak stops likely on a dip through the 107.80 area and congestion likely through the 107.50 level and continuing into growing bids in the 107.00 areas.
• AUD: opening just below the 0.6840 level the market slowly rose once it moved into the Tokyo session trading steadily to the 0.6850 area and then after a few hours moving through to make the highs just above on the move to the grey hour, Downside bids light through the 68 cents level with weak stops likely on a dip through the 0.6780 level and opening the market to a limited move initially but renewing the downside potential through to the 0.6680-0.6700 level with weak stops likely on a dip through the 0.6670 level with congestive bids then likely to be patchy but centred around the sentimental 50/00 areas, topside faces stronger selling again above the 0.6880 level and a bit away from the current levels if ranges have anything to say on the matter, a push through the 69 cents level doesn’t really do much until pushing past the 0.6920 area and congestion quickly following in to limit any gains.
• EUR: A slow drift from the opening around the 1.1100 area and moving into the Tokyo session pushing lower through to just above the 1.1090 level before finding some buyers and pushing through to just above the 1.1100 area for the high and then drifting through towards the lows again for the move into the grey hour, Topside offers increasing on a push through to the 1.1170 area and into the 1.1200 area with congestion likely through the level to cancel out any weak stops and opening up a further steady climb into the 1.1240 areas, Downside bids light through to the 1.1080 level where weak stops are likely to appear however, once cleared 1.1060 level sees minor congestion through to 1.1040 before the market starts to become more supportive on any dips towards the 1.1000 levels.

Overnight News
NZD:
NZ Treasury sees risk S&P could remove positive rating outlook – BBG
NZ Super fund considers no longer hedging all of its bets – Stuff.co.nz
USD:
Rubio plans bill to block Federal pensions investing in China – BBG
US deploys Air Expedition Wing to Saudi
USD/CNY:
USTR’s exclusions on certain tariffs are set to expire Dec 28 – RTRS
FCC moves to cut off Huawei, ZTE from subsidies – DJ
CNY:
US$89b exits the mainland in September despite tough controls – SMP
AUD:
RBA’s rate cuts spooking, not emboldening Australian households – BBG
Australia ANZ weekly consumer confidence falls 1.1% to 110.4
GBP:
UK PM Johnson on course to win his fight for a pre-Christmas General election – Forex Crunch
Johnson loses bid for early election but takes new tack to get one – DJ
EUR/GBP:
EU grants the 31st Jan extension to Brexit delay says Tusk – BBC

Today’s Data
Actual – A | Consensus – C | Previous – P | Revised R | all timings GMT/UTC
AUD RBA Governor Lowe gives Speech in Canberra
0700 GBP Nationwide house price n.s.a. YoY (OCT) C 0.3% | P 0.2%
0930 GBP Consumer Credit YoY (SEP) P 5.4%
0930 GBP Mortgage Approvals (SEP) C 65.0k | P 65.5k
0930 GBP Net Consumer Credit C 0.9b | P 0.9b
0930 GBP Net Lending Sec. on dwellings (SEP) C 3.8b | P 3.9b
1300 USD S&P CoreLogic CS 20-City MoM SA (AUG) C -0.1% | P 0.02
1300 USD S&P Case-Shiller Composite-20 YoY (AUG) C 2.04% | P 2.0%
1300 USD S&P Case-Shiller US Home Price index YoY (AUG) P 3.18%
1400 USD Consumer Confidence Index C 128 | P 125.1
1400 USD Conf. Board present Situation (OCT) P 169
1400 USD Pending Home Sales YoY (SEP) P 1.1%
2350 JPY Large Retailers Sales (SEP) C 8.8% | P 0.4%
2350 JPY Retail Trade YoY (SEP) C 6.1% | P 2.0%

Harry Hindsight

• GBP: Wide opening range on very thin liquidity as the UK resets its clocks to GMT, the market settled to around the 1.2820 level and slowly pushed towards the early high to test into the mid 1.2830’s before drifting into the Tokyo session to make the low just above the 1.2810 area and then slowly holding sub 1.2820 through into the grey hour, a steady rise through the grey hour put the market back towards the high and the opening in London saw the market spark up to the 1.2860 level before drifting back, the same choppy action continued through to the NYK opening with NYK steadily pushing the market through to the high of the day into the mid 1.2870’s before narrowing down to range to the close around the 1.2860 level.
• JPY: A slow narrow range through the Asian session with the market opening around the 108.75 level and tipping lightly through the 108.70 to set the session lows through to the London session however, if you though that was bad then the topside was even more unimpressive pressing to the 108.78 area and unable to push beyond until London, the move into the London session saw the low for the day around the 108.66 area and then slowly recovering back above 108.70 to see early Tokyo running the market quickly through to the 108.85 area pausing then running again in steps through to the 109.00 level then holding around the 108.95 areas through to the close.
• AUD: A quiet Asian session with the market running up to the 0.6826 level in early trading before slowly dipping through to just above the 0.6810 areas and ranging in the teens through to the London session, London were slow buyers through the early part of the session pushing through the 0.6830 areas and then ranging around the level to deep into the NYK session before moving steadily higher again pausing around the 0.6840 level before making the high around the 0.6845 area and then a long run to the close slipping a little too the close.
• EUR: A slow start to the seek with the market moving through the Asian session trading around the opening 1.1080 level with a minor dip through into the 1.1070’s before slowly recovering through to the grey hour and testing through to the 1.1090 areas, the rally stalled around the 1.1095 areas and it held in the area until the hour before NYK before popping through to make the high just beyond the 1.1105 areas before sinking back to the figure for the move into NYK, quick sellers sent the market through to the 1.1085 before recovering and eventually pushing through to the close in London testing back through the 1.1100 level and holding around the level to the close.

Yesterday’s Premiership results
USD Advance goods Trade Balance (SEP) A -$70.39b | C -$73.5b | P -$72.8b
USD Wholesale Inventories MoM (SEP P) A -0.3% | C 0.3% | P 0.2%
EUR ECB President Draghi Speaks in Frankfurt

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