Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good Morning,

LMAX Close
USDJPY 109.775 | EURUSD 1.09105 | AUDUSD 0.66865 | NZDUSD 0.63832 | USDCAD 1.33176 | USDCHF 0.97735 | GBPUSD 1.29138

LMAX highs and Lows 06.00 GMT
Highs | Lows
EURUSD 1.09170 | 1.09078
USDJPY 109.903 | 109.741
GBPUSD 1.29206 | 1.29107
USDCHF 0.97870 | 0.97739
AUDUSD 0.67140 | 0.66811
USDCAD 1.33199 | 1.32983
NZDUSD 0.63952 | 0.63792
EURCHF 1.06777 | 1.06648
EURGBP 0.84519 | 0.84464
EURJPY 119.965 | 119.729

For Today
• GBP: A very quiet session with the market holding in a tight range during a bank holiday Tokyo session, opening around the 1.2915 area and ranging around that point with a single push above the 1.2920 level to set the high before drifting back to hold just above the 1.2910 level through to the grey hours, Topside offers light back through the 1.3000 level with some limited congestion on a test to the 1.3050 area but the market only lightly defended then through to the 1.3150 area with limited stops through the 1.3100 areas, downside bids strong through into the 1.2900 level however, weak stops growing behind the level and limited congestion through to the 1.2850 level and increasing only once the market moves through the area to head for the 1.2800 area.
• JPY: Tokyo bank holiday saw the market rising slowly from the opening 109.75 area to again push through to the 109.90 level before holding in a tight range through to the grey hours slipping back slightly from the latest test of the highs. . Topside offers likely to be limited with weak stops on a push through the 110.20 area and opening up limited room through to the 110.50 and increasing resistance as the market approaches the 111.00 areas, downside bids light through to the 109.00 area with limited support and weak stops likely to be light for a move back to the stronger 108.50 area with good support likely to appear on any dips to the 108.00 levels.
• AUD: Opening around the 0.6685 area and apart from a small dip through to the 0.6680 area before starting a slow run through the session eventually testing to the 0.6710 area to range quietly through into the grey hours having peaked around the 0.6713 area, downside bids cleared through to the 0.6680 level opening up a deeper move over a long period with bids likely to appear around the sentimental 00/50 areas, topside offers light through to the 0.6780 level with strong offers likely to increase into the 0.6800/20 area with weak stops appearing through the level and 0.6840-60 likely to be stronger.
• EUR: Opening around the 1.0910 area the market continued to range through the session around the level with a light test above the 1.0917 level before dipping through to the 1.0908 area for the low of the session and moving through to the grey hours, almost unchanged on the day, Topside offers light through to the 1.1040 area with limited congestion then appearing through to the 1.1070 level where stronger offers are suspected. Downside bids into the 1.0900 level and likely to continue through to 1.0880 before weak stops move into the market with a small gap through to the 1.0860 level where stronger bids appear and congestion through to the 1.0800 level likely with possibly a set of stops around the 1.0840-30 area.

Overnight News
CNY:
Alibaba is said to be blocked from Hong Kong Stock link to China – BBG
China confirms over 1000 deaths through Coronavirus
Construction supply chains at risk from Coronavirus – AFR
Hundred’s of Chinese firms are seeking billions in bank loans to soften the impact – RTRs
JPY:
Greying of Japan poised to curb GDP by 25% in 40 years – IMF
WHO:
Coronavirus cases outside China could spark a bigger fire – NPW
USD/CNY:
US says Chinese steel shipments circumvented antidumping duty – BBG
SGD:
Singapore braces as Coronavirus cases emerge in finance hub – BBG
EUR:
Things are falling apart for Europe’s Currency – BBG

Today’s Data
Actual – A | Consensus – C | Previous – P | Revised R | all timings GMT/UTC
AUD Home Loans Value MoM (DEC) A 4.4% | C 1.6% | P 1.9%
AUD Investor Lean Value MoM (DEC) A 2.8% | C 1.6% | P 2.5%
AUD NAB Business confidence (JAN) A -1 | P -2
0930 GBP GDP YoY (4Q P) C 0.8% | P 1.1%
0930 GBP Construction Output C 3.7% | P 2.0%
0930 GBP GDP QoQ (4Q P) C 0.0% | P 0.4%
0930 GBP Industrial Production YoY (DEC) A -0.8% | P -1.6%
0930 GBP Manufacturing Production YoY (DEC) C 1.0% | P -2.0%
0930 GBP Monthly GDP MoM (DEC) C 0.2% | P -0.3%
0930 GBP Trade Balance (DEC) C -350m | P -4031m
0930 GBP Trade Balance non-EU (DEC) C -2000m | P 1734m
0930 GBP Visible Trade Balance (DEC) C -10000m | P -5256m
1200 MXN Industrial Production n.s.a. YoY (DEC) C -0.5% | P -2.1%
1400 EUR ECB Pres. Lagarde Speaks in Strasbourg EU Parliament
1500 USD Powell to speak before House Financial Services Panel
1535 GBP BoE Governor Carney Speaks before Lords Committee

Harry Hindsight

• GBP: A slow climb through into the grey hours in a reasonably quiet session with the market opening off the 1.2890 level to gradually push through to the 1.2905 area, the move into the London session saw early sellers sending the market through to the London opening hitting the lows for the day testing towards the 1.2870 level before starting a steady rise pushing steadily through to the afternoon pushing back through the 1.2910 level and with some slight setbacks continuing into the NYK session to test the 1.2945 level, the move towards the London close saw the early sellers taking profit and the market dipping back to hold just below the 1.2920 area for a long run to the close.
• JPY: A quiet session overall, opening a little lower around the 109.70 areas saw the small gap on the chart filled before moving into the Tokyo session dipping quickly through to the 109.60 level before holding and then starting a steady rise through to make the highs of the day just below the 109.90 area, slipping back through midsession from the highs the market then held around the 109.75 opening levels and steadily drifting south of the centre of the range to eventually test the 109.65 level and rise back to the opening levels for the close.
• AUD: Opening a little lower the market rose steadily with the weakening of the JPY into the Tokyo session having held roughly around the 0.6670 level testing only slightly lower to make the lows for the day, rising steadily through the 0.6680 level then increasing in pace to push through to the 67 cents level ranging around the level into the London opening before dropping back from the 0.6708 areas to slowly drift back through the session to the opening levels until the final couple of hours to rise to the closing.
• EUR: A very quiet session through to NYK, opening around the 1.0945 area and rising slowly through the 1.0950 level into Tokyo and holding in a tight range through into London with the late Asian session touching close to the 1.0960 area before dipping into the London opening and then ranging around the 1.0950 level through to the NYK session and quickly testing back to the 1.0930 pausing and then running again to the 1.0910 area where the market held in a tight range basing along that low to the close.

Yesterday’s Premiership results
JPY Bank Lending Ex-Trusts YoY (JAN) A 2.0% | P 1.9%
JPY Bank Lending incl Trusts YoY (JAN) A 1.9% | P 1.8%
JPY Housing Loans YoY (4Q) A 2.8% | P 2.9%
JPY Trade Balance – BOP Basis (YEN) (DEC) 120.7b | C 28.0b | P -2.5b
CNY CPI YoY (JAN) A 5.4% | C 4.9% | P 4.5%
CNY PPI YoY (JAN) A 0.1% | C 0.0% | P -0.5%
JPY Eco Watchers Survey Current A 41.9 | C 39.1 | P 39.8
JPY Eco Watchers Survey Outlook A 41.8 | C 43.8 | P 45.4 | R 39.7
0645 CHF Unemployment Rate (JAN) A 2.3% | C 2.6% | P 2.5%
0645 CHF Unemployment Rate s.a. (JAN) A 2.6% | C 2.3% | P 2.3%
0730 CHF CPI EU Harmonized YoY (JAN) A 0.2% | C 0.1% | P -0.1%
0730 CHF CPI YoY (JAN) A 0.2% | C 0.2% | P 0.2%
0730 CHF CPI Core YoY (JAN) A 0.2% | C 0.4% | P 0.4%
1315 CAD Housing Starts (JAN) A 213.2k | C 205.0k | P 197.3k
1330 CAD Building Permits MoM (DEC) A 7.4% | C 2.8% | P -2.4%
2100 NZD NZ Government 6-month Financial Statements

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