Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 109.61 | EURUSD 1.10323 | AUDUSD 0.6060 | NZDUSD 0.59548 | USDCAD 1.40187 | USDCHF 0.96352 | GBPUSD 1.22081 |

 

LMAX Highs and Lows 0600 GMT

 

Highs | Lows

EURUSD              1.10868 | 1.10229

USDJPY               109.751 | 108.238

GBPUSD              1.23064 | 1.21319

USDCHF              0.96538 | 0.95856

AUDUSD             0.61254 | 0.60359

NZDUSD              0.60117 | 0.59439

USDCAD             1.40718 | 1.39999

EURCHF              1.06362 | 1.06147

EURGBP              0.90935 | 0.9006

EURJPY                120.819 | 119.633

 

For Today

 

  • GBP: Limited liquidity for the opening saw the market drifting from the opening around the 1.2180 level testing steadily through to the 1.2140 area before starting the opposing recovery to push through the slight gap on the charts and moving into the Tokyo session, moving through to the midsession holding around the 1.2200 level the market eventually firmly pushed through and slowly rose through too late in the session to lightly test the 1.2300 level before drifting a little back to the 1.2250 area for the move into the grey hours, topside weak offers around the sentimental levels with the market open really to the 1.2500 area before stronger offers and possible stops building for a move back through to the 1.2700 level. Downside bids weak through to the 1.1850 level with possible stronger bids into the area and increasing as the market moves through to the 1.1650 level.
  • JPY: the USD continues to suffer with the market opening on its highs in USDJPY around the 109;70 level and slowly slipping lower to move into the Tokyo opening testing towards the 109.00 level finally breaking through once the Tokyo fix was over to dip initially through to the 108.50 level before briefly pausing and then running to the lows through the 108.30 level to make the low. Downside bids likely into and through the 108.00 level with a break of the 107.80 level seeing some weak stops however, congestion around the 107.50 level could slow any dips towards the 107.00 level however, a break here opens the chance of further downside losses with the likelihood of very little until the 105.00 area.
  • AUD: Drifting in early trading the Oz slipped through to the 0.6040 area before starting to rally into the Tokyo session and testing into the opening around the 0.6080 level a brief dip back to 0.6050 from the opening then saw the market quickly rise through to these through 61 cents level dropping back from the initial probe before making a steady push through to the 0.6130 level and contrary to the market chatter for commodity currencies, having hit the highs the market drifted back to the 61 cents level for the move through to the grey hours. Technically on a roll and the topside see’s limited congestion around the 0.6150 level and likely to continue in the same vein through to the 63 cents level where stronger offers possibly lie, downside bids light through to the 59 cents level with some congestion there before opening for another test to the 58 cent area and weak bids through to the 55 cents level.
  • EUR: A more cautious rise through the session with the Euro moving of the opening area to push lightly initially through the 1.1050 and ranging through to mid-session before having a single run to the 1.1080 level and then dipping back for the run to the grey hours holding around the 1.1060 area. With the ECB about to go into hibernation mode as it did in 2008 the chances are that the market will begin to feel negative about its delays and meanderings and with the Italians already happy to take all the help it can get from Russia after being somewhat rebuffed commentators worry for the European experiment, Downside bids light through to the 1.0850-00 area where the possibility of strong congestion however a push through again exposes the lows to further tests especially if the situation with the virus continues to worsen. Topside offers through into the 1.1100 level are likely to be limited but increasing through the sentimental level and into the 1.1180-1.1200 level with weak stops likely on a push through the 1.1220 level to open up weakness through to the 1.1260 area.

 

Overnight News

 

USD:

Top CDC official warns New York’s Coronavirus outbreak is just a preview – TWT

EUR:

EU leaders set 14-day deadline to propose virus fiscal measures – DPA

Dutch PM Rutte says Coronavirus crisis will las a while difficult to assess exact economic impact now hence unwise to use all our measures of economic support now – DPA

Rutte: We could not agree with other EU leaders on details of ESM support or other instruments, we invited Eurogroup to work out exact proposals in 2 weeks

Rutte: Netherlands against Coronabonds or Eurobonds, if ESM instrument is needed it must include necessary conditionalities – DPA

EU leaders agree on joint statement about virus crisis – DPA

EU’s Michel says will as Eurogroup to continue intense work – DPA

EU Council President Charles Michel Speaks to reporters – DPA

Michel: EU Institutions will lay ground to get out of crisis – DPA

Merkel: ESM was created for such crisis fighting – DPA

French official: No date set for next EU meeting

French official: Political survival of EU project at stake

Merkel: Not yet time to talk about; loosening virus restrictions

Merkel: Virus restriction effects are not yet clear

Merkel: Must ask Germans for patience on virus measures

Merkel: Not all EU member states in agreement on joint debt

Merkel: ESM Opens possibilities for common EU action

Michel: Will have to ensure EIB has additional resources

Anyone remember 2008 and how long it took for a reaction?

NZD:

NZ consumer confidence slumped in March – ANZ

MXN:

Mexico downgraded to BBB by S&P – BBG

USD/CNY:

Trump expects another deal with China

Trump: He will discuss virus with Xi

 

Today’s Data

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

CNY       Industrial Profits YTD YoY (FEB) A -38.3% | C -8.0% | P -3.3%

All Day  GBP       UK Sovereign debt to be rated by Fitch

1230      USD       PCE Core YoY (FEB) C 1.7% | P 1.6%

1230      USD       PCT Core MoM (FEB) C 0.2% | P 0.1%

1230     USD       Personal Income (FEB) C 0.4% | P 0.6%

1230      USD       Personal Spending (FEB) C 0.2% | P 0.2%

1230      USD       Real Personal Spending (FEB) C 0.2% | P 0.1%

1400      USD       U. of Mich Sentiment (MAR F) C 90.0 | P 95.9

1700      USD       Baker Hughes US Rig Count (MAR 27) P 772

 

Harry Hindsight

 

  • GBP: Early trading saw the market slowly dipping through to the 1.1780 level before bouncing and recovering into the Tokyo session pushing the 1.1870 levels, the balance of the Asian session was reasonably quiet holding around the 1.1850 level, with the move through to the London session seeing early buyers appearing to push through to the 1.1950 level, the rise continued through into the NYK session with the Cable testing the 1.2000 level before dipping a little Coronavirus worries in New York in particular over wrought the optimism for the fiscal stimulus to be added and the USD struggled, and GBP continued pushing through the 1.2100 level triggering some weak tops and ranging widely around the 1.2150 level for a few hours before finally running to the 1.2230 level to make the highs with some weak stops on the move through the figure before settling back a little for the close.
  • JPY: A quiet move through into early Tokyo around the 111.20 area before dipping through to the 111.00 quickly and a slow drift through to the official Tokyo session testing through to the 110.50 areas and basing along that line through to the London opening, a slow push through the level saw the market move through to the 110.00 level to range tightly for the move into the NYK session before dipping again and testing into the 109.30 area ranging widely before starting a slow tightening range through to the close.
  • AUD: Opening quietly around the 0.5850-60 areas and dipping suddenly through to the 0.5900 level for the move through to the Tokyo session, a quiet range around the figure level before breaking and trading down to the 0.5870 level for the low of the day, from there though the market was a single tight steady channelled rise through to the highs pushing into late NYK above the 0.6080 level before dipping back a little for the close.
  • EUR: A quiet range around the opening 1.0890 levels and then quickly pushing through to the 1.0930 into early Tokyo before slipping slowly back to the 1.0900 level and a quiet range around that level through to the London session, slow but steady USD selling allowed the Euro to rise steadily through to the NYK session holding around the 1.0950 level after a single push to the 1.0980, NYK repeated the moves and the Euro slowly pushed through the 1.1000 area and then slowing its rise through to the 1.1050 area before dipping slowly for the close.

 

Yesterday’s Premiership Results

EUR       German GfK Consumer Confidence (APR) A 2.7 | C 7.7 | P 9.8

EUR       ECB Publishes Economic Bulletin

GBP       Retail Sales Ex-Auto Fuel MoM (FEB) A 0.5% | C 1.1% | P 1.2% | R 1.3%

GBP       BoE asset Purchase Target (APR) A 645b | C 635b | P 435b

GBP       BoE Bank Rate (MAR 26) A 0.1% | C 0.1% | P 0.1%

USD       Advance Goods Trade Balance A -59.89b | C -63.8b | P -65.5b

USD       GDP Annualized QoQ (4Q T) A 2.1% | C 2.1% | P 2.1%

USD       Initial Jobless Claims (MAR 21) A 3283k | C 1500k | P 281k | R 282k

USD       Continuing Claims (MAR 14) A 1803k | C 1782k | P 1701k | R 1702k

USD       Core PCE QoQ (4Q T) A 1.3% | C 1.2% | P 1.2%

USD       GDP Price Index (4Q T) A 1.4% | C 1.3% | P 1.3%

USD       Personal Consumption (4Q T) A 1.8% | C 1.7% | P 1.7%

USD       Wholesale Inventories MoM (FEB P) A -0.3% | C -0.4% | P -0.4%

 

Best Regards

Andy

 

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