Morning Report: Calm After JPY Storm

Key Data Releases Today

0930GMT – GBP Manufacturing PMI 51.4 v 51.6
1430GMT – CAD Manufacturing PMI 53.5                                                                                               1500GMT – USD Construction Spending exp 0.7% v -0.8%                                                   1500GMT – USD ISM Prices Paid exp 58 v 59.5


Week ahead sees Central Bank meetings from RBA, BOE and ECB – all attention on Draghi with the baton passed from Kuroda. Employment data in AUS, NZD, US and CAD. Main mover overnight was the Aussie closing around 8800 on Friday and opening at 8740 driven by weaker China PMI at 50.8,  a fall in building approvals of 11% saw the pair test 8703. Note also in CAD BoC Poloz will be speaking this evening at 17.50 and this will be followed by a press conference.

  • CAD flat ahead of Poloz speech and press conference this evening.
  • EUR is soft as Fed statement supports a strong USD. Likely range bound ahead of ECB later this week.
  • GBP pressured ahead of BOE later this week, the Central Bank are now less likely to make a move at this meeting.
  • JPY is extremely weak after last weeks BOJ action.
  • AUD under renewed pressure after weak China data overnight.

Key Trades

EURUSD: Neutral To Bearish – Revised (looking for spec longs)
USDCAD: Neutral To Bullish – Revised ( looking for spec longs)                                               GBPUSD: Neutral To Bullish – Revised (short stops to risk free)                                                   USDJPY: Bullish – No Change                                                                                                                             AUDUSD: Neutral – Revised (looking for spec longs)


EURUSD: Neutral – No Change 

  • Thursdays pin bar has been neutralised and price is testing year to date lows
  • Order Flow indicators to the downside here as price moves lower post FMOC statement and BOJ action
  • Rejection candles at lows in line with Order Flow indicators crossing higher may provide spec long opportunities



USDCAD: Neutral To Bullish – Revised

  • Price continues to oscillate at highs
  • Daily Order Flow indicators are firmly to the upside here with OBV making new highs
  • Price action feels well supported here with this pull back from highs seeming corrective to the bull trend rather than the start of a reversal.
  • Will wait for clear signal to set longs



GBPUSD: Neutral To Bullish – Revised 

  • Pin bars continue to print but lack confirmation in the follow through price action
  • Have moved stops on shorts to break even and will try spec longs on break higher from pin bars targeting weekly highs initially.
  • Order Flow indicators have crossed to the upside here supporting possible bullishness



USDJPY: Bullish – No Change

  • Price action continues to be very bullish Order Flow indicators firmly to the upside here
  • Long positions are still fully intact with stops trailed up to just below the NFP highs to lock in profits.
  • Added longs on break of NFP highs, trailing stops, positions are risk free


yenAUDUSD: Neutral – No Change

  • Exited shorts from last week as price has closed above the pin bar entered on
  • Price gapped lower overnight o weak data out of China and fall in building approvals
  • Order Flow indicators are stabilizing as price tests lower end of the range. Will attempt spec longs on a pin bar close against lower end of contracting range.