Daily FX Market Commentary

Andy Harrison

Andy Harrison

Good morning,

 

LMAX Close

USDJPY 107.222 | EURUSD 1.12423 | AUDUSD 0.6867 | NZDUSD 0.64163 | USDCAD 1.36609 | USDCHF 0.95119 | GBPUSD 1.22985 |

 

LMAX Highs and Lows 0500 GMT

Highs | Lows  

EURUSD               1.12512 | 1.12339

USDJPY                107.786 | 107.543

GBPUSD               1.23153 | 1.22899

USDCHF               0.95172 | 0.95088

AUDUSD              0.68850 | 0.68591

NZDUSD               0.64275 | 0.64123

USDCAD               1.36701 | 1.36545

EURCHF               1.06964 | 1.0691

EURGBP               0.91397 | 0.91344

EURJPY                121.170 | 120.87

 

For Today

 

  • GBP: A very quiet range with the Cable opening around the 1.2295 area and slowly pushing through into the Tokyo session testing the 1.2315 area for the highs of the day so far, the market dipped through to the 1.2300 level before again making a steady move through to the high and holding mid-range through to the grey hour, Downside bids into the 1.2250 level likely to be a little thicker with day traders having had a look at the level yesterday with further bids likely to appear to the 1.2200  level likely to be slow going with congestion likely to continue with a mix of stops on a push through the 1.2160 area for a stretch to the 1.2100 level, Topside offers light through to the 1.2400 level and weak stops could cause a small short squeeze with some offers through the 1.2500 levels and increasing weakness until above the 1.2550-1.2600.
  • JPY: A quiet start with the market holding around the 107.60 level through into the Tokyo session before steadily pushing towards the 107.80 area and continued to hold above the 107.80 through to the grey hour, topside offers continue through to the 108.20-25 area before weak stops are likely to appear and the possibility of pushing through to the 108.50 area before hitting some congestion, weak congestion through to the 108.80 level and stronger offers likely to appear for any move through the 109.00-20 level. , Downside weak through the 107.00 level before opening for a fresh run at the 106.50 area and possible short term buying through to the 106.00 level where bids are likely to increase, a break through to the 105.90 areas is likely to see weak stops appearing, limited bids through to the 105.50 area and increasing through to the 104.80.
  • AUD: Dipping through to the 0.6860 level from the opening the market recovered for the move into Tokyo testing through to the 0.6875 area, the market dipped again and tested the lows again before pushing a little more strongly through the 0.6880 area to push weakly through to the 0.6885 area for the high and holding for the grey hour, Topside offers light through the 69 cents level and opening only a little on a break above the 0.6920 area and light stops pushing to the 0.6950 area, likely to be light through the 0.7000 area and stiffen on any move through to the 0.7050-0.7100 area, once through the 0.7120 area the possibility of a small squeeze however, Downside bids light through to the 0.6800 area and continuing on any push through to the 0.6780 level is likely to see stronger stops appearing and the downside opening to a deeper move. With limited bids through to the 0.6700-0.6680 before stronger bids appear.
  • EUR: Rising quietly from the opening to push through the 1.1250 areas from the 1.1240 level before dipping back and holding in the area through to the grey hour, downside congestion through the 1.1200  level with weak stops likely on a strong move through the 1.1170 area opening up a quick test through the 1.1150 level before hitting stronger congestion through to the 1.1100 level from the beginning of the month and vulnerable to a stronger move through to 1.1050 before the market starts thickening for the sentimental 1.1000, Topside congestion into the 1.1280-1.1300 area building the longer it remains below with further offers through the 1.1350 level with increasing offers likely through to the 1.1400 level with strong stops possible on a move through the 1.1420 area to open up a quick move through  to the 1.1450 area before slowing as the market moves to the sentimental 1.1480-1.1520 area and possibly a bid tone.

 

 

Overnight News

 

USD:

Powell warns of extraordinary uncertainty, Urgency to curb virus – BBG

USD/HKD:

Pompeo says US ending some defence, tech exports to Hong Kong – BBG

US Commerce secretary says Hong Kong’s special status revoked over China actions – BBG

CNY:

Trade spat, Virus add fuel to China’s push for Iron ore security – BBG

TWD/CNY:

Taiwan plans to tighten investment rules for China – FT

CNY/USD:

US downgraded to medium risk for China investment as relations turn sour amid higher uncertainties – SMP

 

Today’s Data

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

JPY         Jobs/applications ratio (MAY) A 1.20 | C 1.23 | P 1.32

JPY         Industrial Production MoM (MAY) A -8.4% | C -5.6% | P -9.8%

CNY       Chinese Composite PMI (JUN) A 54.2 | P 53.4

CNY       Manufacturing PMI (JUN) A 50.9 | C 50.4 | P 50.6

CNY       Non-Manufacturing PMI (JUN) A 54.4 | P 53.6

NZD       ANZ Business Confidence (JUN) A -34.4 | P -41.8

AUD       Private Sector Credit MoM (MAY) A -0.1% | P 0.1%

AUD       RBA Assist Gov Debelle Speaks

0600      GBP        Business Investment QoQ (Q1) A | C 0.0% | -0.5%

0600      GBP        Current Account (Q1) A | C -15.4b | P -5.6b

0600      GBP        GDP QoQ (Q1) A | C -2.0% | P 0.0%

0600      GBP        GDP YoY (Q1) A | C -1.6% | P 1.1%

0630      CHF        Retail Sales YoY (MAY) A | P -19.9%

0700      CHF        KOF Leading Indicators (JUN) A | C 77 | P 53.2

0700      EUR       Spanish GDP QoQ (Q1) A | C -5.2% | P 0.4%

0900      EUR       Core CPI YoY A | P 0.9%

0900      EUR       CPI MoM A | P -0.1%

0900      EUR       CPI YoY (JUN) A | C 0.1% | P 0.1%

1000      GBP        BoE MPC Member Haldane Speaks

1230      CAD       GDP MoM (APR) A | C -13.0% | P -7.2%

1300      EUR       ECB’s Schnabel speaks

1345      USD       Chicago PMI (JUN) A | C 45.0 | P 32.3

1400      GBP        BoE MPC Member Cunliffe Speaks

1400      USD       Consumer Confidence A | C 91.8 | P 86.6

1500      USD       FOMC Member Williams Speaks

1500      EUR       ECB’s De Guindos Speaks

1505      USD       FOMC Member Brainard Speaks

1630      USD       Fed Chair Powell Testifies

1800      USD       FOMC Member Kashkari Speaks

2030      USD       API Weekly Crude Oil Stocks A | P 1,749m

2230      AUD       AiG Manufacturing Index (JUN) A | P 41.6

2245      NZD       Building Consents MoM (MAY) A | -6.5%

 

Harry Hindsight

 

  • GBP: A slow start to the session saw the Cable unchanged and holding around the 1.2335 level through into Tokyo before starting a slow steady push through to the 1.2360 level, a few weak stops saw the market push through into the grey hours making the high around the 1.2390 area before moving into the London session and slipping into a steady drift lower into the London session, a tight channelled drift through to the 1.2320 where the market closed on Friday, the move through into the NYK session slowly saw the 1.2300 level and triggered more selling on the opening to push the market quickly through to the 1.2250 area and a bounce from there to the 1.2290 level and a slow grind to finish the day just below the 1.2300 level.
  • JPY: Opening unchanged and dipping towards the 107.10 area before ranging through to the Tokyo session holding the opening level, the push through the Tokyo fix saw very little movement however, post the event USDJPY ran through to the high 107.30’s before then spending the run into London drifting through to test the 107.05 area repeating the test into London opening and then slowly grinding back to the opening levels to trade quietly through the London morning to push into the NYK session with stronger buying moving in to take the market through to the 107.90 areas before running into sufficient offers and maybe on the story of USD liquidity issues for the future in EM currencies, especially those that issued debt in USD’s that need serving in said currency, the move through to the close saw the market holding around the 107.70-80 areas for the most part until the last hour where it dipping through to the 107.55 area.
  • AUD: Dipping from the opening around the 0.6860 level through to the 0.6845 area in early trading before bouncing back to the opening for the move through into Tokyo session and a steady rise through to the 0.6885 level and drifting a little before running again to touch through the 0.6890 level for the move into the grey hour, London quick sellers through to the 0.6870 area and then ranging through to the NYK session holding in the 0.6870-80 area, selling from the opening saw the Oz dip back to the 0.6840 area for the low of the day before a steady grind back through to the 0.6865 level for the close.
  • EUR: A quiet opening moving from the 1.1225 area through into the Tokyo session holding the level tightly before Tokyo started a steady push through deep into the grey hour testing the 1.1270 area before pausing into the London opening dipping back through the 1.1250 level and then starting a second run through to the 1.1280 area to range around the level through deep into NYK morning before dipping quickly back to the 1.1240 level and then once London closed running again to push through to the opening level before bouncing and then gradually pushing through to the 1.1240’s for the close.

 

Yesterday’s Premiership Results

CNY       Chinese Industrial Profit YoY (MAY) A 6.00% | P -4.30%

CNY       Chinese Industrial Profit YTD (MAY) A -19.3% | P -27.4%

JPY         Retail Sales YoY (MAY) A | C -11.8% | P -13.9%

EUR       Spanish CPI YoY A -0.3% | P -0.9%

EUR       Spanish HICP YoY (JUN) A -0.3% | C -0.5% | P -0.9%

EUR       German CPI MoM (JUN) A 0.6% | C 0.3% | P -0.1%

CAD       Building Permits MoM (MAY) A 20.2% | P -17.1% | R -15.4%

CAD       RMPI MoM (MAY) A 16.4% | P -13.4%

USD       Pending Home Sales MoM (MAY) A 44.3% | C 19.7% | P -21.8%

 

Best Regards

Andy

 

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