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Andy Harrison

Good Morning,

For Today
• GBP: A quiet drift from the opening highs around the 1.3030 level drifting through into mid-Tokyo to test the 1.3015 level before ranging quietly through to the grey hours holding the 1.3020 area, Downside bids building into the 1.3000 levels with limited congestion from current levels through to the weak stops through the level are likely to run into congestion on a dip to the 1.2950 area with stronger bids likely in that area, Topside congestion through to the 1.3200 levels with strong offers likely in that area with weak stops on a push through the 1.3220 area and opening the market to a run to the 1.3300 level and stronger offers reappearing in the area.
• JPY: Opening around the 109.15 level and rising on a quick move to just above the 109.25 area to make the high of the session before dipping on early selling from the Tokyo traders, holding around the 109.10 level through to the fix saw demand take the market through to the 109.20 level and a fair few hours trading tightly around the level before dipping back to the opening level for the move into the grey hours, Topside congestion into the 110.00 level but likely to be limited with stronger congestion into the 110.50 level and likely to increase the closer the market moves to the 110.80 area where stronger offers start to appear leading into stronger congestion on any push to the 111.00 level, downside congestion likely mixed with weak stops on a move through the 108.80 area however, any push through to the 108.50 area is likely to see stronger congestion from there onwards.
• AUD: The Oz dipped in early trading to the 0.6755 area as AUDJPY saw a few sellers before gradually pushing higher through the early part of Tokyo to test lightly above the 0.6770 before drifting a little and running for a second time to fail the 0.6780 area and holding around the 0.6770 area to the grey hours, Topside offers light through to the 68 cents level with light congestion through to 0.6820 before weak stops appear for a retest to the 0.6840-60 area and slightly stronger offers beginning to reappear leading to strong offers on any push towards the 69 cents, downside bids into the current lows with a breach through the 0.6740 area is likely to see limited weakness dipping through to the 67 cents level and stronger bids appearing through to the 0.6680 areas.
• EUR: The Euro saw early highs into the Tokyo session pushing through to just above the 1.1025 level before starting a long steady drift through to just above the 1.1010 level for the move into the grey hours, Downside bids likely to be strong into the 1.1000 level with option barriers likely and likely weakness through the 1.0980 levels and stops appearing if not option related sellers, opening a dip through to the 1.0950 level before stronger bids start to appear in the market, topside offers light through to the 1.1080 level with stronger offers beginning to build in the area with congestion through the 1.1100 areas and weak stops awaiting beyond the 1.1120 level for a run to the 1.1150 areas.

Overnight News
CNY:
China reports 1459 more Coronavirus cases in 31 provinces
Novel Coronavirus death toll rises to 132
Coronavirus cases jump to 5,974
USD:
Weighs ban on all flights from China over virus outbreak – DJ
Airlines are cutting flights to China -BDR
AUD:
Of course, the RBA should cut rates – AFR
Australia’s Island evacuation plan from Hubei raises eyebrows – BBG
WHO:
The World Health Organization admits error in assessment of deadly coronavirus risk – TWT The Hill

Today’s Data
Actual – A | Consensus – C | Previous – P | Revised R | all timings GMT/UTC
AUD CPI YoY A 1.80% | C 1.70% | P 1.70%
AUD CPI QoQ (4Q) A 0.70% | C 0.60% | P 0.50%
AUD CPI Index RBA Trimmed means QoQ A 0.40% | C 0.40% | P 0.40%
AUD CPI Index RBA Weighted Median QoQ (4Q) A 1.30% | C 1.20% | P 1.30%
JPY Consumer Confidence Index (JAN) A | C 39.5 | P 39.1
0700 EUR German GfK Consumer Confidence (FEB) C 9.6 | P 9.6
0700 GBP Nationwide House PX n.s.a. YoY (JAN) C 1.50% | P 1.40%
1200 USD MBA Mortgage Applications (JAN 24) P -1.2%
1330 USD Advance Goods Trade Balance (DEC) C -65.5b | P -63.2b
1330 USD Wholesale Inventories MoM (DEC P) P -0.1%
1500 USD Pending Home Sales YoY (DEC) P 5.6%
1530 USD DOE US Crude Oil Inventories (JAN 24) P -405k
1900 USD FOMC Rate Decision (lower band) (JAN 29) C 1.50% | P 1.50%
1900 USD FOMC Rate Decision (Upper band) (JAN 29) C 1.75% | P 1.75%
1900 USD Interest rate on Excess reserves (JAN 30) C 1.55% | P 1.55%
1930 USD Powell holds post FOMC meeting press conference
2145 NZD Trade Balance (DEC) C 100m | P -753m
2145 NZD Trade Balance 12mth YTD (DEC) C -4725m | P -4816m
2350 JPY Loans and Discounts Corp YoY (DEC) P 2.02%

Harry Hindsight

• GBP: Limited movement through the Asian session with the market lifting slowly into early Tokyo pushing to the 1.3065 area before just as slowly returning to the opening levels for the move into the grey hours, early sellers in Europe saw the market dropping back to the 1.3010 level for the London opening and then slipping to the 1.3005 to hold through to the NYK session before dipping again and slipping through the 1.3000 level to run to the London close testing to the 1.2975 area before finding sufficient support to hold and start a slow recovery through to the 1.3000 level initially and then slowly rising to the close just above the 1.3025 level on light volumes.
• JPY: USDJPY opened around the 108.90 level to rise quietly into the Tokyo session, Tokyo fix saw supply and the market dipped quickly through to the 108.80’s before quickly recovering and pushing through to range around the 109.00 levels into the grey hours, Limited push through to the 109.10 area before London opened and the market quickly dropped back on safe haven flows towards the end of the Tokyo session and the market testing lightly through the 108.80 level before holding for a few hours and started to rise steadily through to the NYK session and taking a second run through to the 109.20 level for a long drawn out run to the close holding the 109.10-20 levels.
• AUD: A fairly quiet Ozzie range through the day, with the market opening around the 0.6760 level and trading quietly into the Tokyo session dipping through to the 0.6750 area and ranging in the area until late in the session before recovering the opening level for the move into the grey hours, early London and from the opening were sellers through to just below the 0.6740 level however, the market held up and started a slow move through back into the Tokyo range and continued through until the Sydney session before starting to rise to the highs for the close.
• EUR: A quiet range through to the NYK session ranging quietly in Tokyo with a minor push to the days highs testing the 1.1025 level before returning to the 1.1020 area and the opening level to run through into the London session, the market widened a little but only by a few pips testing to the 1.1015 area and the NYK session came in selling on a push to the 1.1005 and then the next few pips took several hours breaking through the 1.1000 level but only by a pip or two before starting a slow steady rise from the end of the London session testing back to above the 1.1020 area for the close.

Yesterday’s Premiership results
AUD NAB Business Confidence (DEC) A -2 | P 0
USD Durable Goods Orders (DEC P) A 2.4% | C 0.90% | P -2.1%
USD Durables Ex Transportation (DEC P) A -0.1% | C 0.30% | P -0.10%
USD S&P CoreLogic CS 20-City MoM SA (NOV) A 0.48% | C 0.30% | P -0.43% | R -0.4%
USD S&P Case/Shiller Composite 20 YoY (NOV) A 2.55% | C 2.40% | P 2.23%
USD S&P Case/Shiller US Home Price Index YoY (NOV) A 3.54% | P 3.34%
USD Consumer Confidence Index (JAN) A 131.6 | C 128.0 | P 126.5 | R 128.2
USD Conf. Board Present Situation (JAN) A 175.3 | P 170

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