LMAX Exchange - unique vision for global FX

Andy Harrison

Good Morning,

For Today

• GBP: Opening quietly for the move through into the Tokyo session around the 1.3900 area before starting a steady drift through to the 1.3870 level with a limited dip through before holding quietly in the area through to the grey hours, topside offers around the 1.4000 level and slightly stronger stops appear for the market to open to a move through to the 1.4050-1.4100 with patchy resistance until closer to the topside of that range and stronger offers thereafter, downside bids into the 1.3800 level with weak stops likely on a dip through the 1.3780-40 levels with congestion likely to soak up much of the selling through to the 1.3700 level with possibly strong congestion then around the 1.3700 level increasing into the 1.3650 level before being able to make a move to the 1.3600 area and strong bids again.
• JPY: A quiet range through the session so far with the market, rising through the 109.20 area into the Tokyo session to test into the 109.25 area before drifting around the 109.20 level for a couple of hours only to return to the opening levels and a limited test to the 109.10 level before holding around the 109.15 areas, Topside congestion is likely to soak up some of the weak stops above through to the 109.50 area where strong congestion is likely to appear and increasing offers into the 110.00 and like the previous spikes at the beginning of last year any move is likely to find resistance above and continuing through the 110.00 with break out stops likely to be a little more nervous, downside bids light through to the 108.00 level with weak stops on any retrace through the 107.80 level and opening a dip to the 106.00 area possible over the coming week.
• AUD: As with the USDJPY with a quiet range around the 0.7750 level with early trading through to just above the 0.7740 level slowly recovering and pushing to the 0.7755 area for the range and holding just above the 0.7750 level through to the grey hours, Topside offers through the 0.7780-0.7820 area with weak stops through the possible strong offers to open a slow grind through to the 0.7840-60 area and then increasing offers onwards through 0.7900, , downside bids into the 76 cents level with strong bids likely through to the 0.7580 area, weak stops are likely to be few and far between with stronger bids likely into the 0.7550 level and likely stronger congestion through to the 0.7500 area.
• EUR: A tight range through into the Tokyo session drifting from the 1.1930 level pushing towards the low 20’s before steadily recovering and testing just below the 1.1940 level for the move into the grey hours. Congestion through the 1.1820-1.1780 area with weak stops possibly being cleared up quickly through to the 1.1750 and again stronger congestion and likely to continue through the 1.1700 level, topside offers light back through the 1.1920 area and weak stops possibly setting up a small short squeeze through to the 1.1980 area before stronger offers start to appear into the 1.2000 level. Topside offers light through to the 1.1950 area with offers then starting to increase through to the 1.2000 level with weak stops above the 1.2020 level before the offers return increasing into the 1.2040-60 level.

Overnight News

USD:
Biden’s tax plan will hit people earning over $400k hardest – BBG
Senators propose Bipartisan revamp of National Security tariffs – BBG
EUR/GBP:
EU begins legal action against UK over Brexit violation – BBG
EU legal action over UK’s alleged breach of N. Ireland protocol on delivering Vaccines to the area
EU due to start UK legal action on Monday, person familiar says – BBG
GBP/EUR:
Johnson threatens to withhold £20b divorce settlement (Danegeld) over coming years
AstraZeneca reviewed the data of 17m people, 37 people developed blood clots, no higher than normal population cases – CBC
USD/CNY:
American rescue plan: China moves to counter turmoil in financial markets as policy divergence widens with US – SMP
JPY/USD:
Japan set to trigger safeguard tariffs on US beef – BBG
AUD:
RBA says economy recovering strongly, watching fiscal tapering – BBG
USD/CNY/AUD:
Just not going to happen; US warns China over Australian trade stoush (Fight) – SYH

Today’s Data
AUD House Price Index QoQ (Q4) A 3.0% | C 2.0% | P 0.8%
AUD RBA Meeting Minutes
JPY BoJ Gov. Kuroda Speaks
JPY Industrial Production MoM (JAN) (P) A 4.3% | P 1.0%
1000 EUR German ZEW Current Conditions (MAR) A | C -62.0 | P -67.2
1000 EUR German ZEW Economic Sentiment (MAR) A | C 74 | P 71.2
1000 EUR ZEW Economic Sentiment (MAR) A | P 69.6
1230 USD Core Retail Sales MoM (FEB) A | C -0.1% | P 5.9%
1230 USD Export Price Index MoM (FEB) A | C 0.9% | P 2.5%
1230 USD Import Price Index MoM (FEB) A | C 1.2% | P 1.4%
1230 USD Retail Sales MoM (FEB) A | C -0.5% | P 5.3%
1230 CAD Foreign Securities Purchases (JAN) A | P 5.08b
1315 USD Industrial Production YoY (FEB) A | P -1.83%
1315 USD Industrial Production MoM (FEB) A | C 0.3% | P 0.9%
1400 USD Business Inventories (MoM) (JAN) A | C 0.3% | P 0.6%
1400 USD Retail Inventories Ex-Auto (JAN) A | P -0.2%
2130 USD API Weekly Crude Oil Stock A | P 12.792m
2145 NZD Current Account YoY (Q4) A | C -2.59b | P 2.55b
2145 NZD Current Account QoQ (Q4) A | C -2.88b | P -3.52m
2330 AUD RBA Assist Gov. Kent Speaks
2350 JPY Exports YoY (FEB) A | C -0.8% | P 6.4%
2350 JPY Trade Balance (FEB) A | C 420.0b | P -325.4b

Harry Hindsight

• GBP: Another early high having opened around the 1.3920 level and then steadily rising through into the Tokyo fix pushing through to the 1.3950 level before dropping back a little quicker to the opening level and holding just above the 1.3920 area to move quietly through to just before the grey hours and dipping through to the 1.3910 level quickly and the following through on the move into the grey hours testing through the 1.3900 area, a long steady drive through to close to the highs into the London opening, from there the market sagged back as the spat or as the Ozzies say stoush continues with the EU, sinking through to the 1.3850 area through into the NYK session before London buying for the close saw the market pushing through to the 1.3890 area and eventually to the 13900 level for the move to the close in a quiet range.
• JPY: A light dip on the opening then saw the USDJPY rising through the session into Tokyo opening pushing the 109.10 level only to fall back for the move to the Tokyo fix, a light follow through saw the low of the day just above the 108.90 area and the market steadily rising through to the 109.20 area and struggling with the level through to the grey hours before breaking higher to push above the 109.35 area for the high of the day, London were slow sellers trading back to the day’s opening levels and then holding in the 109.10-20 through into the NYK session with a light move above and below the range however, it generally held through to the close in NYK.
• AUD: Dipping on the opening the market managed to move off the 0.7750 areas to test to above the 0.7770 area peaking around the 0.7775 level for the high of the day before dropping back a little quicker to hold the 0.7750 area for a short time and then dipping on the move to the grey hours, light buying through into the London session testing back to 0.7760 area before again drifting for the move into the NYK session, holding quietly before dipping quickly through to the 0.7705 area for the low and a quick bounce back above the 0.7740 level to rise quietly through to the 0.7760 area and close just below.
• EUR: Opening around the 1.1940 area and slowly filling a small gap saw the market ranging around the 1.1950 area to move into the Tokyo session steadily testing higher and a quick test to the 1.1965 area before slowly drifting back through to the 1.1950 level again, midsession in Tokyo saw the Euro slipping lower and continuing through to the 1.1930 area and then a tight range throughout the London and NYK sessions, with light attempts to the 1.1940 and limited moves below the 1.1920 to finish mid-range.

Premiership Results
AUD RBA Gov. Lowe Speaks
CNY Fixed Asset Investment YoY (FEB) A 35.0% | C 40.0% | P 2.9%
CNY Industrial Production YoY (FEB) A 35.1% | C 30.0% | P 7.3%
CNY Chinese Industrial Production YTD YoY (FEB) A 35.1% | P 2.8%
CNY Chinese Unemployment Rate A 5.5% | P 5.2%
CNY NBS Press Conference
AUD HIA New Home Sales MoM A 22.9% | P -69.4%
JPY Tertiary Industry Activity Index MoM A -1.7% | P -0.4% | R -0.3%
EUR Eurogroup Meetings
CAD Housing Starts (FEB) A 245.9k | C 245.0k | P 282.4k | R 284.4k
USD NY Empire State Manufacturing Index (MAR) A 17.40 | C 14.50 | P 12.10
CAD Manufacturing Sales MoM (JAN) A 3.1% | C 2.5% | P 0.9%
USD TIC Net Long Term Transactions (JAN) A 90.8b | P 121.0b

Best Regards
Andy

Any opinions, news, research, analyses, prices or other information contained on this Blog, whether by LMAX, its employees, partners or contributors, does not constitute investment advice nor has it been prepared in accordance with legal requirements designed to promote the independence of investment research. Further, the material contained within this Blog does not contain (and should not be construed as containing) investment advice or an investment recommendation, or an offer of, or solicitation for, a transaction in any financial instrument. Whilst information provided on this Blog may help with your investment research you must consider carefully whether you should make (or refrain from making) investment or other decisions based on what you see without doing further research on the investments you are interested in. Participating in this Blog cannot be a substitute for obtaining advice from an appropriate expert independent adviser who takes into account your circumstances and specific investment needs in selected investments that are appropriate for you. LMAX has not verified the accuracy or basis-in-fact of any claim or statement made by any third parties as comments for every Blog entry.

LMAX will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. No representation or warranty is given as to the accuracy or completeness of the above information. While the material produced in this Blog was obtained from sources deemed to be reliable, LMAX does not provide any guarantees about the reliability of such sources.
Consequently, any person acting on it does so entirely at his or her own risk.

If you currently hold an account with LMAX for the purposes of trading FX and CFD’s, you are encouraged to use a different Username and Password to access the Blog or any other online systems. The Blog is a place to learn, discuss and share information and ideas with Blog followers. It is not a place to slander, use unacceptable language or to promote LMAX or any other FX, Spread Betting and CFD provider and any such postings, excessive or unjust comments and attacks will not be allowed and will be removed from the site immediately.

LMAX Group blog - FX industry thought leadership

Daily FX Market Commentary

LMAX Group blog - FX industry thought leadership

Sign up for Global FX Insights, the daily market commentary from LMAX Group