Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good Morning,

 

LMAX Close

USDJPY 107.689 | EURUSD 1.09981 | AUDUSD 0.59983 | NZDUSD 0.59518 | USDCAD 1.4201 | USDCHF 0.96104 | GBPUSD 1.20536 |

 

LMAX highs and Lows 06.00 GMT

                                Highs | Lows

EURUSD               1.10452 | 1.0985

USDJPY                 107.733 | 106.948

GBPUSD               1.21297 | 1.2046

USDCHF               0.96115 | 0.95674

AUDUSD              0.60289 | 0.59847

USDCAD               1.42420 | 1.41683

NZDUSD               0.59684 | 0.59385

EURCHF               1.05838 | 1.05647

EURGBP               0.91336 | 0.90681

EURJPY                 117.905 | 118.451

 

 

For Today

  • GBP: Opening a touch lower the market moved off the 1.2070 low to steadily push through the 1.2100 level and testing into the Tokyo session the 1.2120 level, a slight dip on Tokyo opening testing quickly back to the figure level bouncing and holding close to the level through the early hours the market started a slow rise through to the 1.2130 level and a slow drift through to the grey hours in the 1.2115 areas, Downside bids light through to the 1.2050 level then stronger bids start appearing through to the 1.2000 level and possible option barriers into the level, with likely limited stops appearing until a strong break through the level, increasing bids again through to the 1.1950 level and the lows from last year in focus will likely see stronger stops appearing. Topside offers likely to be light and the possibility of a short squeeze on any move through the 1.2300 area, weak offers through to the level with sentimental areas containing the resistance and stronger offers likely towards the 1.2500 level.
  • JPY: Dipping from the early highs around the 107.70 areas, dropping steadily through to the 107.20 level before recovering a little for the move into the Tokyo session, unable to regain the opening level the market started a slow drift through to the 107.10 level and ranged through to the grey hours unable to push through the 107.30 level to fun to the grey hours holding just off the lows. Topside offers light through to the 108.50 area with some limited congestion likely through to the 108.70 areas with stronger offers likely to appear through the 109.00 area with weak stops likely on a break through the 109.20 levels, possible weakness through into the 109.80 area where stronger offers are likely to appear, downside bids into the 107.00 lightly congested with the market then opening up for another dip through the 106.00 level before steady bids start to appear through to the 105.50 level and possible weak stops through the level and limited support until 105.00-104.50.
  • AUD: Opening a touch higher the Oz tested through to the 0.6030 level in early trading before slowly drifting through to the Tokyo opening testing the 0.5980 areas and holding through to the official opening before starting a slow steady rise to press the 0.6030 level again for the run to the grey hours, Downside bids into the 0.5940-60 level and AUDNZD at the closest point of parity since 2015, a break below the 0.5940 level is likely to see stops appearing in size and while there are likely to be bids into the 59 cents level it could be the same as the 60 cent level and the market slightly jaded having seen bottom pickers burnt along the way. Topside offers likely through the 61 cents level with weak offers increasing through to the 0.6150 level and a break here could see some weak stops and a short squeeze possible.
  • EUR: A slow push from the opening just below the 1.1000 level and testing the 1.1020 area the move through into the Tokyo session saw the market reversing and slowly drifting through to just below the 1.0990 level, once the Tokyo fix was over with the market started a slow drive through to just above the 1.1045 level for the move into the grey hours, Downside bids into the 1.0950 level with strong congestion and sentimental bids going through to the 1.0940 before weakness starts to appear, and dip to the 1.0900 level will likely see further support for the market with strong stops likely on a push through the 1.0880 levels, Topside offers light through to the 1.1150 area where congestion are likely to appear and increasing on any test towards the 1.1200 level again.

 

Overnight News

USD:

FED: Establishing primary dealer credit facility

FED: PDCF available on March 20 on maturities up to 90 days

FED: Primary dealer facility available for at least six months

FED: Will accept broad range of investment grade debt collateral for long to primary dealers including commercial paper and municipal bonds and broad range of equity securities

FED: Interest rate will be at the primary credit (or Discount window) rate

White House pushing stimulus of $1T or more for virus – BBG

USD/CNY:

Relations near breaking point, more US journalists expelled

GBP:

Traders bet against UK “laissez-Faire” response to virus – BBG

Chancellor borrows language from Draghi, and raises the fiscal response – BBG

EUR:

Europe shuts its borders in desperate effort to stop virus – BBG

AUD:

Westpac’s Evans sees Australian unemployment rising to 7% – BBG

 

Today’s Data

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

NZD       Current Account GDP Ratio YTD (4Q) A -3.0% | C -3.1% | P -3.3%

JPY         Trade Balance (FEB) A 1109.8b | C 916.7b | P -1312.6b

1000       EUR        Eurozone CPI YoY (FEB F) C 1.2% | P 1.2%

1000       EUR        Eurozone CPI core YoY (FEB F) C 1.2% | P 1.2%

1100       USD       MBA Mortgage Applications (MAR 13) P 55.4%

1230       CAD       CPI YoY (FEB) P 7.4%

1230       CAD       CPI n.s.a. MoM (FEB) P 0.3%

1230       USD       Building Permits MoM (FEB) C -3.20% | P 9.2%

1230       USD       Housing Starts MoM (FEB) C -4.3% | P -3.6%

1430       USD       DOE US Crude Oil Inventories (MAR 13) P 7664k

2145       NZD       GDP YoY (4Q) C 1.7% | P 2.3%

2145       NZD       GDP s.a. QoQ (4Q) C 0.5% | P 0.7%

2330       JPY         National CPI YoY (FEB) C 0.5% | P 0.7%

2330       JPY         National CPI Ex-Fresh Food YoY (FEB) C 0.6% | P 0.8%

2330       JPY         National CPI Ex Fresh Food, Energy YoY (FEB) C 0.7% | P 0.8%

 

Harry Hindsight

 

  • GBP: A quick dip from the opening saw the market recovering from the early lower to push to the 1.2270 areas to run through to the Tokyo session holding tightly around the level, Tokyo were slow sellers dipping through to the 1.2230 area and then slowly recovering through to the grey hours pushing back to the opening levels around 1.2260, from the grey hours onwards the market was steady quiet selling through into the London opening dipping for the first time through 1.2200 level before holding quietly in early London just above the level, uninspiring employment data, possibly the bottom of the market for the time being saw the market increasing its moves lower in speed and testing steadily through to late morning to the 1.2100 level to range quietly around the figure through to the NYK session, and a more steady drift through to the 1.2050 level, some choppy trading through to just before the close in London saw an attempt to test the 1.2000 level before moving off the low for a push through to the 1.2100 area, ranging in the 1.2050-1.2100 level through to the close.
  • JPY: Holding quietly around the 105.90 level through early trading the market started to rise after the first hour to push from the level to test to the 106.30 areas before holding into the Tokyo opening, the move to the Tokyo fix saw the market rising quickly through to push above the 107.00 level peaking to the 107.20 areas before dipping just as quickly back through to the 106.30 level before stabilizing and holding through to the grey hours around the 106.50 level, grey hour buying saw a slow rise into the London opening testing the 107.00 level again but this time struggling with the level the market dipped back again before rising through to the NYK opening again breaking 107.00 and this time maintaining contact with the level, NYK eventually started to grind through the offers pushing through to the 107.50 areas and ranged tightly around the level through to late in the session before making the high of the day and the peaking around the 107.85 area before drifting a little to finish just below the 107.70 area.
  • AUD: Trading quietly through the early part of the session in the 0.6100 opening level to test the 0.6125 areas before dipping into the Tokyo opening, Tokyo were steady buyers through to make the highs close to the 0.6150 level before drifting back and holding again around the 0.6125 area and not really doing to much until the move into the grey hours when the strong selling pushed it firmly through the 0.6100 level to test through to the 0.6065 area holding through to London before again dropping again this time a tight channelled drop through to midmorning testing the 60 cents level, chopping around the level through to deep into the NYK session before being forted through to the 0.5960 area on the close in London, a slow grind through to the 60 cents level for the close.
  • EUR: Given the session overall a quiet Asian session saw the market ranging through to the Tokyo opening from the opening to test the 1.1180 level then a slow rise through to mid Tokyo session testing the 1.1200 level to hold quietly just below the level through to the London opening, London saw strong steady selling pushing through and testing into the NYK session falling from the 1.1180 levels and after a brief pause dip and continue through to the 1.1000 level and stronger bidding appearing, the market ranged around the level eventually pushing quickly to just below the 1.0960 level, the market kept pressing the level for a few hours through the London close before slowly rising through to the close testing back to the 1.1000 areas.

 

 

Yesterday’s Premiership results

AUD       RBA Minutes of March Policy Meeting (MAR)

JPY         Industrial Production YoY (JAN F) A -2.3% | P -2.5%

GBP       Average Weekly Earnings 3M/YoY (JAN) A 3.1% | C 3.0% | P 2.9%

GBP       Claimant Count Rate (FEB) A 3.5% | P 3.4%

GBP       Employment Change 3M/3M (JAN) A 184k | C 140k | P 180k

GBP       ILO Unemployment Rate 3Mths (JAN) A 3.9% | C 3.8% | P 3.8%

GBP       Jobless Claims Change (FEB) A 17.3k | P 5.5k | R -0.2k

GBP        Weekly Earnings ex Bonus 3M/YoY (JAN) A 3.1% | C 3.2% | P 3.2%

EUR        Eurozone ZEW Survey (Economic Sentiment) (MAR) A -49.5 | P 10.4

EUR        German ZEW Survey Expectations (MAR) A -49.0 | C -27.2 | P 8.7

EUR        German ZEW Survey Current Situation (MAR) A -43.1 | C -30.0 | P -15.7

USD       Retail Sales Advance MoM (FEB) A -0.5% | C 0.2% | P 0.3%

USD       Retail Sales Control Group (FEB) A 0.0% | C 0.4% | P 0.0%

USD       Retail Sales Ex Auto and Gas A -0.2% | C 0.4% | P 0.4%

USD       Industrial Production MoM (FEB) A 0.6% | C 0.4% | P -0.3% | R -0.5%

USD       Manufacturing (SIC) Production (FEB) A 0.1% | C 0.3% | P -0.1% | R -0.2%

USD       Business Inventories (JAN) A -0.1% | C -0.1% | P 0.1%

USD       NAHB Housing Market Index A 72 | C 74 | P 74

 

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