SocGen FX Flows – FXWW Chatroom

{JN} Flows overnight were generally USDJPY selling (although we think it may have been more spec CTA oriented than actual Japanese RM names judging from the prx action on the tok fix). In any event we edged through 120.00-119.90 in Ldn on some EURJPY sales but hold now. So from here we look to ~119.30 (aka the 50DMA) for support this DMA has been supportive the past few sessions. Further down below we look for bids into 118.20-30 initially with 117.80-118.0 something of a support on the charts. Up above we eye resistance into 120.2-40 but the big resistance level is still 121.50-122.0 which was toppy last week (we dont really have offers here until 121.80-122.00). There are about 1.25bn of 120.00-120.50 expiries rolling off this morning so expect this one to be pulled a little higher by those between now and 10am all else equal 

{EU} EURUSD took a run at 1.0850 but failed to break above and drifts lower since despite demand in our flows. It would appear that the market is expecting month end supply of EURs but so far our flows have been a little more balanced and we continue to suspect corp and other local demand on dips given the price action last week. Remember the move higher last week was violent and I reckon some who held onto shorts will be happy to take them back if they can on the 1.07 and the 1.06 handle. Saying that down below we really don’t have a ton of orders on the books until 1.0580-1.0620 (which was resistance early last week) but could envision demand into 1.0700 and then 1.0680. The topside is also pretty clean but look for offers to cap a move into 1.0840-60 again and then 1.0920-40 is a bit of a level up above too. Of course the big topside resistance (where we failed on Thursday) stands at 1.1050-70. There some big 1.0800-1.0825 rolling off this morning and 2bn of 1.08s tomorrow so expect this to help support things all else equal 

GB} EURGBP collapsed violently in our session and overnight it didnt find a ton of love with the EUR heavy on the whole and talk of EURGBP selling for month end. From here we look at 7340 as resistance with 7250 holding now. Saying that book here is pretty clean down below at the moment until you get through 7180-70 but saying that we could see demand (for similar reasons mentioned above with regard to EURUSD plus here we have had a good mix of buyers on dips from a mix of names – RM and Corps etc). GBPUSD has been a little heavy the past 24hrs or so but its outperformed other USD pairs and holds at 1.4750 for now but we reckon 1.4720-00 is more significant support. Up above 1.4950-1.5000 attracted supply last week and we expect this to continue. 

{SZ} EURCHF edged a little lower with the EUR-Xs in general but USDCHF demand in our flwos holds this one up and as mentioned late last week we have rebuilt some bids into 1.0420 and expect this region to hold. In USDCHF we have seen good spec/macro and CTA interest to buy over the past 24hrs having seen decent position cleansing last week and at the moment we envision the market being set up to retest higher 9750-9800 as initial resistance. Down below the 9600-9580 region is initial support (as a consolidation point on the way down early last week with 9480 the big downside support on the chart now). 

{AU} I mentioned AudJpy sales earlier and these in addition to general USD strength took AUDUSD through 7600 but we found interbank demand down there. In fact in terms of support the 7580-7550 level is on people’s radar. Expect to see supply into 7650-80 in addition there were stops below 0.7710-00 so expect supply there too. Also up above is now cleaned out with the 7740-50 area an interesting resistance but nothing on the books here until the 78 handle. I should add that after a test lower the past few weeks EURAUD continues to shake out shorts who got caught and are buying on the 1.4120-14160 area with us. We think that 1.4300-20 could be another pressure point. 

{CA} $CAD spiked through 1.2750-70 earlier but found local supply in the market. In fact for the past week or so we have found supply from RM names (locals in the market continue to be better sellers into rallies too). We expect 1.2800-50 to be a big resistance given the price action last time we were up here. Down below is very clean into 1.2550-00. I should point out that although there are not a lot of exps today there are a lot of 1.2800-1.30 strikes in the market which could create congestion as we get into this region 

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