Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good Morning,

 

LMAX Close

USDJPY 109.049 | EURUSD 1.10219 | AUDUSD 0.6787 | NZDUSD 0.64236 | USDCAD 1.32714 | USDCHF 0.99734 | GBPUSD 1.28658 |

 

LMAX highs and Lows 06.00 GMT

                                Highs | Lows

EURUSD               1.10249 | 1.10094

USDJPY                109.175 | 109.014

GBPUSD              1.28734 | 1.28466

USDCHF               0.99818 | 0.9970

AUDUSD             0.67911 | 0.67721

USDCAD              1.32803 | 1.32693

NZDUSD              0.64329 | 0.64227

EURCHF               1.09969 | 1.09881

EURGBP              0.85733 | 0.85675

EURJPY                120.265 | 120.154

For Today

  • GBP: A new poll suggests the Conservative lead slipping a little lower and the market opened around the 1.2860 level and after an initial test towards the 1.2870 level slipped through to the 1.2850 area for the move into the Tokyo session, the rest of the day saw the market holding quietly around the 1.2850 level through to the grey hours in quiet trading, 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: A slow push through the early market saw the USDJPY pushing from the 109.05 opening areas and pushing into the Tokyo session testing the 109.10 level with slow trading from the Tokyo opening onwards saw the market ranging above the level through to late into the session to slowly test through the 109.15 areas for the move 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 cleared to the 109.20 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: Opening around the 0.6785 area and some light weakness through into the Tokyo session to slowly push through to the 0.6790 level before the Westpac comments saw the market quickly dropping back through to the 0.6775 areas to slowly test through the level and then hold around the lows through to 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: A slow drift from the opening 1.1023 area to move into the Tokyo session losing steadily through the day, while the range was limited the market eventually moved through the 1.1010 level for the move into 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

AUD:

Westpac now sees RBA cutting to 0.25% in June

Westpac expects RBA to begin quantitative easing in 2h 2020

Quantitative easing just two rate cuts away – DJ

S&P warns Australia fiscal stimulus could put AAA rating at risk – BBG

Australia 3Q Construction Work -0.4% est. -1%

CNY:

A $20T problem: More than half of China’s banks fail Central Bank stress test – Zero Hedge

USD:

API Reports US Crude stockpiles rose 3.64m bbl last week – BBG

Trump says US will designate Mexican drug cartels as terrorists – NPW

CNY/HKD:

China sets up Hong Kong crisis centre in mainland considers replacing chief liaison – FirstPost

GBP:

New poll sees Con 36, Labour 28, and Con slipping – BBG

NZD:

NZIER Forecasts no more RBNZ rate cuts even as GDP growth slows – BBG

RBNZ leaves LVR Mortgage lending restrictions unchanged – BBG

 

Today’s Data

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

 

NZD       RBNZ Publishes Financial stability report

NZD       Trade Balance (OCT) A -1010m | C -1000m | P -12422m

NZD       Trade Balance 12mth YTD (OCT) A -5040m | C -4900m | P -5213m

NZD       RBNZ Governor News Conference on FSR

1200       USD       MBA Mortgage Applications (NOV22) P -2.2%

1330       USD       Durable Goods Orders (OCT P) C -0.7% | P -1.2%

1330       USD       GDP Annualized QoQ (3Q S) C 1.9% | P 1.9%

1330       USD       GDP Product Price Index (3Q S) C 1.7% | P 1.7%

1330       USD       Continuing Claims (NOV 16) C 1690k | P 1695k

1330       USD       Core PCE Q0Q (3Q S) P 2.2%

1330       USD       Durables Ex Transportation (OCT P) C 0.1% | P -0.4%

1330       USD       Initial Jobless Claims (NOV 23) C 220k | P 227k

1330       USD       Personal Consumption (3Q S) C 2.8% | P 2.9%

1445       USD       Chicago Purchasing Manager (NOV) C 47.0 | P 43.2

1500       USD       PCE Core YoY (OCT) C 1.7% | P 1.7%

1500       USD       PCE Core MoM (OCT) C 0.1% | P 0.0%

1500       USD       Pending Home Sales YoY (OCT) C 5.5% | P 6.3%

1500       USD       Personal Income C 0.3%B | P 0.3%

1500       USD       Personal Spending (OCT) C 0.3% | P 0.2%

1500       USD       Real Personal Spending (OCT) C 0.0% | P 0.2%

1530       USD       DOE US Crude Oil Inventories (NOV 22) P 1379k

1800       USD       Baker Hughes US Rig Count P 803

1900       USD       US FED Beige Book

2350       JPY         Large retailers Sales C -7.1% | P 10.0%

2350       JPY         Retail Trade YoY (OCT) C -3.8% | P 9.1%

 

Harry Hindsight

 

  • GBP: Opening towards its highs the market was unable to clearly break through the 1.2900 level and traded around the level through to the grey hours, early London quickly saw the market dipping a little and settling into a slow steady drift through the session testing to the 1.2870 level holding for a short period before continuing the push through to the 1.2850 level, the market bounced a little on the move into the NYK session however, the rally managed only to reach the 1.2880 area before sagging and again pushing through the original lows to test to the 1.2840 areas, with the low actually pushing through into the mid 1.2830’s before starting a slow steady rise through to the closing levels just above the 1.2860 areas in quiet trading.
  • JPY: A quick rise from the opening around the 108.90 area to push the 109.00 level and the opening in Tokyo saw the market rising again to push lightly through the 109.05 level, some weak stops and a little scramble saw the market rise through 109.20 level on a spike before dipping back and saw steady sellers as the early buyers were squeezed out of the market, the move through to the grey hours saw the market again testing back to the sub 109.00 level and London took it steadily to its lows to test into the upper 108.80;s and a small recovery to the 108.95 area, NYK started buying as the day turned into a USD buying day and the USDJPY again managed to hold the 109.10 areas and ranging in the area to the London close before slipping down to the 109.05 area for the close.
  • AUD: Limited range but choppy at times, opening around the 0.6780 level early sellers saw the market slipping through to the 0.6775 areas before slowly rising back to the opening level and spiking through the 0.6785 area to fall back and then rise slowly through to the 0.6785 area into the grey hours, drifting from the opening in London again saw the market tipping to the 0.6775 areas before Lowes commentary whipped the market too the lows of the day through 0.6770 and then to the highs pushing through the 0.6795 level and a steady drop back to the 0.6780 level area ranging in a 10 pip range before moving through the 0.6785 areas for a quiet range through to the close above that 85 area.
  • EUR: Opening around the 1.1010 level saw limited test through to the 1.1005 in early Tokyo before starting a slow climb through to the grey hours pushing the 1.1015 area and holding deep into the London session before pushing through to the 1.1020 level and then ranged through to the NYK session and light buying from the opening saw the market extend the highs through to 1.1025 before around of USD buying appeared and the market quickly testing to the lows again before spending the rest of the session recovering to finish the day just off the highs.

 

Yesterday’s Premiership results

EUR        German GfK Consumer Confidence A 9.7 | C 9.6 | P 9.6

AUD       RBA’s Lowe gives speech in Sydney

GBP       BBA Loans for House Purchase (OCT) A 41.2k | C 42.1k | P 43.1k | R 42.3k

USD       Advance Goods Trade Balance (OCT) A -66.5b | C -71.0b | P -70.4b

USD       Wholesale Inventories MoM (OCT P) A 0.2% | C 0.1% | P -0.4%

USD       House Price Index MoM (SEP) A 0.6% | C 0.3% | P 0.2%

USD       House Price Purchase Index QoQ (3Q) A 1.1% | P 1.0%

USD       S&P CoreLogic CS 20-City MoM SA (SEP) A 0.36% | C 0.3% | P -0.16%

USD       S&P/Case-Shiller Composite 20 YoY (SEP) A 2.1% | C 2.0% | P 2.03% | R 2.02%

USD       S&P/Case-Shiller US Home Price Index YoY (SEP) A 3.22%V | C 3.3% | P 3.17%

USD       Consumer Confidence Index (NOV) A 125.5 | C 127 | P 125.9

USD       Conf. Board Present Situation (NOV) A 166.9 | P 172.3

USD       New Home Sales MoM (OCT) A -0.7% | C 1.0% | P -0.7% | R 4.5%

 

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