Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good Morning,

 

LMAX Close

USDJPY 108.921 | EURUSD 1.10144 | AUDUSD 0.67779 | NZDUSD 0.63974 | USDCAD 1.32993 | USDCHF 0.99671 | GBPUSD 1.29004 |

 

LMAX highs and Lows 06.00 GMT

                                Highs | Lows

EURUSD               1.10162 | 1.10074

USDJPY                109.206 | 108.920

GBPUSD              1.29050 | 1.28925

USDCHF               0.99748 | 0.99642

AUDUSD             0.67862 | 0.67722

USDCAD              1.33127 | 1.32979

NZDUSD              0.64239 | 0.64056

EURCHF               1.09837 | 1.0974

EURGBP              0.85410 | 0.85302

EURJPY                120.247 | 119.986

For Today

  • GBP: Another quiet session for the Cable with the market holding around the 1.2900 level through the session unable to push beyond the 1.2905 level and in latter trading the market slipped to the 1.2895 areas for the move into the grey hours, Topside offers congested on any attempt to the 1.3000 level however, a break through the 1.3020 area will see stops appearing and the market pushing higher with some congestion through to the 1.3100 level the market could struggle without strong impetus and reasoning, downside bids light through to the 1.2850 area with strong bids likely to hanging around the 1.2800 areas and strong congestion below.
  • JPY: Rising from the closing lows just above the 108.90 level and pushing into the Tokyo session testing the 109.00 level slowly pushing to the 109.05 area before popping quickly through to the 109.20 level on a quick spike higher before falling back to hold sub 109.00 through to the grey hours, Downside bids into the 108.20 area before stronger bids are likely to appear on any push at the 108.00 area, some weak stops through the 107.80 level and a likely test through to the 107.50 areas with stronger bids along a trend line likely to slow the descent with stronger congestion through into the 107.00 level. Topside offers again around the 109.00 level are likely to be weak however, a push through is likely to see stronger offers reappearing and continuing through to the 109.50 level with stronger offers into this month’s highs.
  • AUD: Dipping from the opening around the 0.6780 areas and pushing into the low 0.6770’s before holding quietly around the 0.6775 area deep into the Tokyo session before rising quickly above the 0.6785 area before immediately settling back again and starting a slow climb through towards the 0.6785 area for the move into the grey hours, Downside bids light through the 0.6770 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 stronger offers likely through to the 0.6950 areas with limited resistance behind the 0.6960 level but increasing on any move towards the 70 cents level through to 0.7020 and stronger stops a possibility opening up further gains for the long term.
  • EUR: Quietly ranging for the most part around the 1.1010 level in limited trading, the market tested through the 1.1015 area holding close to the level through to the grey hours, Downside congestion continues in the current area with the congestion likely to extend through to the 1.1000 areas with weak stops mixed with congestive bids on any dip through the 1.0980 area, and congestion then continuing through to the 1.0950 area where stronger bids are likely to start appearing for any move through to the 1.0900 areas, Topside offers weak through to the 1.1100 areas with limited stops on a move through the area however, stronger congestion starts to appear on any push through to the 1.1150 areas and continuing through to the 1.1180 level and stronger offers then appearing on any test towards the 1.1200 level however, while there could be option barriers in the area stops above the level could be an attractive target.

 

 

Overnight News

USD:

Powell: FED policy supporting decisive return to 2% inflation

Powell: If outlook changes materially, policy to change as well

Powell: Policy appropriate provided economy remains on track

Powell: Monetary policy well positioned to support FED’s goals

Powell sees glass much more than half full, can fill it further

AUD:

RBA Deputy Governor: Gradual rise in wages would be welcome

Debelle sees steady wage growth over next couple of years

Debelle: Growing evidence that wage rises of 2-3%, ow the norm rather than the 3-4%

Debelle: If wage growth entrenced at 2-3%, tighter labour market will have to be to force wage a wage rise

Debelle: Gradual lift in wages growth would be welcome for workforce and economy

Debelle: wage lift also needed for inflation to reach 2-3% target range

Debelle: Jobs growth stronger than expected in recent years but also labour supply

Debelle: Supply driven by rise in participation rates of females and older workers

Debelle: One key uncertainty is whether labour supply will continue to expand

Qantas axing hundreds of jobs – AFR

More Xinjiang documents; alleged spy in Australia

GBP:

MP’s to vote on Brexit deal before Christmas if Boris Johnson wins majority at election

CNY:

Tewoo debt plan shows China is allowing state firms to fail – BBG

CNY/USD:

China, US top trade negotiators hold phone call – Xinhua

China, US reach consensus on solving issues – Xinhua

China, US agree to keep contact on remaining matter in phase 1 – Xinhua

TWD:

Taiwan ruling party says China enemy of democracy after meddling allegations – HAA

 

Today’s Data

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

0700       EUR        German GfK Consumer Confidence C 9.6 | P 9.6

0905       AUD       RBA’s Lowe gives speech in Sydney

0930       GBP       BBA Loans for House Purchase (OCT) C 42150 | P 42310

1330       USD       Advance Goods Trade Balance (OCT) C -71.0b | P -70.4b

1330       USD       Wholesale Inventories MoM (OCT P) C 0.1% | P -0.4%

1400       USD       House Price Index MoM (SEP) C 0.3% | P 0.2%

1400       USD       House Price Purchase Index QoQ (3Q) P 1.0%

1400       USD       S&P CoreLogic CS 20-City MoM SA (SEP) C 0.3% | P -0.16%

1400       USD       S&P/Case-Shiller Composite 20 YoY (SEP) C 2.0% | P 2.03%

1400       USD       S&P/Case-Shiller US Home Price Index YoY (SEP) C 3.3% | P 3.17%

1500       USD       Consumer Confidence Index (NOV) C 127 | P 125.9

1500       USD       Conf. Board Present Situation (NOV) P 172.3

1500       USD       New Home Sales MoM (OCT) C 1.0% | P -0.7%

 

Harry Hindsight

 

  • GBP: Opening about 15 pips from Friday’s close the market opened just above the 1.2850 area and ranged through the Tokyo session around that level unable to push above the 1.2855 area with any conviction and then holding above the 1.2840 area to London opening, the market steadily rose prior to the opening pushing to the 1.2870 areas holding briefly before pushing a little above the 1.2880 area through to midday before dipping a little and holding quietly around the 1.2870 deep into NYK before running a second time and pushing quickly above the 1.2910 area to make the highs dropping back a little before recovering the figure level for a long run to the close.
  • JPY: A slow rise through the day with the market opening a little above the close on Friday, pushing slowly through to the Tokyo session from the 108.65 area and testing through to the 108.80 level before holding quietly through to the grey hours, the market moved steadily through to the 108.90 area for the move to the London session and another long period of quiet ranging around the 108.85 areas, the move through to the NYK session saw the market pushing through the 108.90 level and although there was a slight dip the market slowly pushed to hold above the 108.90 area through to the close.
  • AUD: Dipping from the 0.6790 opening levels the market filled the small gap from Fridays close, the move into the Tokyo session saw the market pushing to the highs but unable to break the 68 cents level before ranging quietly around the 0.6795 through to the London session, the market start to slide lower through the London session testing to the 0.6785 level before bouncing a little through into the NYK before slowly drifting again through to the London close testing lightly through the 0.6770 area before recovering only a little to just under the 0.6780 areas.
  • EUR: Opening a around the 1.1020 closing levels the market rose slightly through to the 1.1025 areas before dipping back in midsession testing the opening levels through to the grey hours and a steady rise through to the 1.1030 ranging deep into the session making the highs around the 1.1032 areas before dipping quickly back through to the 1.1010 areas and while there was a minor rise through to the opening levels it really did very little testing a few times through to the 1.1005 area bur remaining around the 1.1010 areas to the close.

 

Yesterday’s Premiership results

EUR        German IFO Business Climate (NOV) A 95 | C 95 | P 94.6 | R 94.7

EUR        German IFO Current Assessment (NOV) A 97.9 | C 97.9 | P 97.8

EUR        German IFO Expectations (NOV) A 92.1 | C 92.5 | P 91.5

MXN      Economic Activity IGAE YoY (SEP) A -0.10% | C -0.6% | P -0.85%

NZD       Retail Sales Ex Inflation QoQ (3Q) A 1.6% | C 0.5%B | P 0.2%

 

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