 Okay, very good morning. It is Monday 1st of July. I hope everyone is well and had an excellent weekend As per usual Monday gonna discuss obviously the weekend's events the conclusion is G20 and the The kind of relief rally seen across assets is the main talking point for me this morning But we're gonna look at some of the other highlights In summary central bank decision out of Australia. Well, they won't they cut rates You've got an OPEC meeting happening today and then OPEC plus tomorrow You've got US independence day, which does certainly add a different dimension to how I think you should approach this week Because come Wednesday, I'd say late afternoon Then definitely Thursday all markets closed in the US and typically that and can then influence I guess people's approach volume wise as to how they would go about their business So definitely I'd say front loaded in terms of the week And then payrolls still though is scheduled for Friday So we'll come back. We'll circle round to do that But this is the main headline that people are looking at from the weekend, of course And this is that Trump has revived China talks with the tariff truce So he's gonna hold off basically imposing the 300 billion dollars worth of tariffs that he had threatened so remember instead of going from Doing that at 25 percent last week he was saying might drop that to 10 percent And now it's a complete kind of freeze at least for the moment So the existing US tariffs on Chinese goods remain in place But no escalation at least at this point the other notable development here was that The US would also delay restrictions against Huawei letting the US companies resume sales It's obviously China's largest telecommunications company and that also big positive because that was what China have really Didn't take too kindly and they have upped the ante ever since that move targeting specifically that company So a bit of a stepping down on the US side on that Particular point has been well received and the talks between the two leaders Apparently went particularly well albeit in line with expectations from the point that there was no real Definitive detail and conclusiveness to the talks other than what I've just said They're freezing that 300 for now and then some of the restrictions on Huawei are being also delayed So the markets are responding in kind and I would classify this as a real relief kind of rally interestingly then US equities S&P Record high of course back up there. Donald Trump will be loving this this morning. He'll be tweeting. I'm sure Once he gets up, but you can see here quite a nice technical play here on the daily continuation You had the previous all-time high, of course. You had the retest we got right up there Towards I guess last week when there were some signs that potentially They were gonna broker some sort of deal that broke down But then came back just towards the end of last week as things started to turn a little bit more positive again And you can see how again record all-time high territory But using that previous resistance now turned support as a nice launching pad around that 61 and a quarter 62 level for the the kind of push up to where we are at the moment So all things remaining equal you would say now that we're 20 points short of it Got to be thinking gonna test up close to all that 3000 now in the S&P This is what it looks like if you look at the the 30 minute candlestick so you can see it a bit more detail and that previous Kind of all-time high was around pretty much lining With the R1 on the day so gaps up of course decent gap up On the back of the news bit of a pullback down to that R1 and that previous technical longest-term point now of Resistance-turn support and we've just managed to punch higher as I'm speaking to the fresh record highs Once again, so European indices following suit that's off to a 200 point plus start for the day What does that mean for fixed income futures? Well, of course the tenure on the back foot I can see here a couple of trend lines that I presume Sam had on At the end of last week so you can see that triple touch that we had back on the 26th And that's worked out quite nicely on the the actual retests here get down aggressive So the inverse relationship with the equity market You can see came back up to retest that trend line again before pushing back down So the area there of support holding the spawn to watch on the downside Would be around that s2 level on the daily pivots in the US tenure. The other interesting product, of course is gold aggressive drop, you know gold had seen such a strong bid tone up to Snapping through that 1400 in the last two weeks or so so a couple of different moves here You had the aggressive gap down But then if you look at the price points that we're identifying here, this is the 1400 level So actually opened about a dollar and a half just above the 1400 level But remember when markets reopen for electronic trade things are obviously particularly choppy so 11 p.m. London time last night This is what the futures look like looking on a one-minute candlestick and quite an interesting The moves here again opening just above 1400 but then almost Immediately the snap through that psychological level you see an immediate spike of decent $13 or so in the following a few minutes But if you look at on five-minute chart and you're playing that same story and looking at the the cross asset class movement I think potentially you could have had a good trade there if you were trading overnight To play that that key level you can see as we got back up to retest the 1400 here and here could have offered you a nice area to get short then the prevailing move and Really as Europe's come in the early birds The markets just continue to to move down down to those lows where we kind of reside at the moment, so Gold obviously unwind of the flight to quality bid now that the main at least short term Key risk factors on the global trade war have have moved aside And then the other thing of course the dollar index is strengthening the Dixie's up about half a percent Because don't forget and everyone was talking about the Fed have got to go really heavy on the rate cuts The Fed have got to do 50 basis point cut obviously this now removes one of the most significant headwinds for the Fed Again for the short term things are always subject to change, but for now the repricing of assets What's happened here is that the dollar is restrengthening people have not Completely eliminating the fact we're still going to have multiple rate cuts and indeed a rate cut in July from the Fed But perhaps just backing off a little bit the aggressiveness and the dollar repricing then Moving a little higher and that in step weighing on both the major currency pairs And then the other one of course is oil Looking at WTI crude this morning You can see here the opposite effect so gap up and a push above the highs of the end of last week So just reclaiming the $60 handle a dual-fold effects for oil of course because It's not just about the trade war which certainly helps mitigate again short term some of the demand concerns easing now on the back of that temporary truce between US and China but OPEC and what materialized out of the G20 meeting was basically an agreement from Mohammed bin Salman and Vladimir Putin so the heads of state of Saudi and Russia who have said basically we've signed off on the commitment to cut Production it's just a matter of whether it's going to be an extension for six or nine months So those kind of dual fundamental factors helping lift WTI crude as well So I mean that pretty much summarizes it, but I guess let me just run over a couple of those headlines just to kind of Cement things in your head of what's been going on. So yeah, I saw this chart But we've already really discussed it But I guess there's a nice overlay of looking at the inverse move that you've had this morning the gap up in the S&P 500 and the consequent move down in the US 10 year on the back of this this news and the relief rally Gold as I said had such a it's had such an awesome mid-June Breaking that 1400 obviously surging from around 1340 But a little bit pull back in a break below 1400 which will now act as a strong level of resistance and only pull back higher How we price now in the federal funds futures So in the short end of the curve now still Very much so pricing in 100% the idea that we're going to cut rates in July But this left-hand bar the one that's indicative of a 50 basis points cut in a few weeks time that number has been decreasing so again More moving to the view then that we're going to get a 25 not a 50 basis point rate cut Albeit still not off the card still a 20% probability This was the headline that I mentioned. This was the one talking about Saudi and Russia agreeing to roll over the existing cuts. I don't think that's particularly massive news We've been saying this on the desk for a while that that was going to be the base case scenario I guess if you're trading this now and we're going to look at the tentative schedule for today The market now is priced for the deal to be done It's a matter of whether it's going to be six on nine months Obviously the longer option the nine months the more potentially short medium term the bullish that is for price Given the the extended commitment then through to potentially march of 2020 This is that tentative schedule I would always take these with a big pinch of salt because as we know from a communication Approach OPEC is notoriously bad sticking to the script As I said a lot of the surprise Shock value out of this meeting is now gone given those g20 comments But always good to know what is the schedule? So this is vienna time vienna tracking an hour ahead of london So we'll be looking at nine o'clock The opening session 10 a.m. The closed session And things get a little bit more interesting into the afternoon then because the The closed session and press conference is going to be looking around two o'clock and then four o'clock for the latter press conference But normally we know ahead of that given the likelihood the doorstep comments From various different all ministers will give the game away ahead of time. So Will we get confirmation on the six or nine month potentially not today because the way the OPEC meetings Work nowadays is that it's not a one-day meeting of OPEC It's OPEC day one and then it's OPEC plus non-OPEC ministerial meeting day two So if you think about it actually it's day two that's potentially more important for the confirmation of what they'll do Because that of course is when russia forms part of the agreement and for that it's going to be midday On tuesday when we get the joint press conference, but I'd imagine you'll know ahead of time before then Whether we're going to have that nine months or not then Just to add A dose of reality because everything i've talked about and everything that's being reflected in prices this morning definitely is dominated by the The trump news and haven't even mentioned about the historic Stepping across the the kind of Line if you like that divides in the The region in career between the north and south that trump he actually almost kind of Inadvertently led to a meeting where he just tweeted saying kim jong-un if you want to meet me I'll be at the border kim jong-un then took him up on that and actually one of the first presidents to cross over In-person territory over the line so again Just adds to that That sentiment at least at the reopening of trade the positive nature that north career was becoming a bit of a risk But if you think about it This is very telling in the fact that if you do a deal with china then really As a by-product that's an indirect deal with north career because The two kind of operate as one in in some respect Particularly when we're talking about us relations. So yeah all positive on that front But the one thing that wasn't was some of the economic data. We have had On sunday. This was saturday night going into sunday. You had some chinese manufacturing pmi data You've also had several other Countries within the asia pacific region And all of remained in contraction So there still is you know, let's not get too much ahead of ourselves here Although there's been some some obvious positive catalysts that have occurred The economic situation is still Relatively fragile at the moment and hence the reason why you know the fed still needs to cut And various other policy measures are still tipping towards the easing side at least for the moment Okay, so back to the calendar. What else is there for the week? Well, we've pretty much covered off what the major things are But now that the g20 is done and we know the current status of the relationship with us and china Actually, i'd say the trade war if anything might take a bit of a back step for this week and actually the thing i'm most Monitoring most intently this week is actually us economic data again Now as i've said i've discussed what the current market positioning is for a rate cut But i think by the end of this week will be in a much better position As to the rural Under the bonnet of the us economy and the type of policy reaction that's going to be going to be needed Because we've got ism non manufacturing pmi later on today. We've also got fed's clarita speaking later on today as well You've then got the us adp employment change on wednesday You've got few us factory orders on wednesday. You've got ism manufacturing from us on wednesday And of course you've got non farm payrolls on friday So a series of top level tier one indicators from the us Which i think by the end of this week then will have probably even more clarity about You know whether or not that 50 basis points needs to be further unwound in the market or not Again be particularly mindful of the fact that it is independent stay on thursday So thursday will be all things remaining equal absolutely dead in the market And that also means that probably by late afternoon even london time on wednesday There is a us early market closure And so it's likely to be very quiet as well as people want to get away from their desks and enjoy potentially an extended weekend So i would say most traders will be back on stateside because of non farms But there will be some still out of the market just given The significance of the independence holiday for the us calendar So very much a front-loaded week and the final thing to mention is you've got the rba That's the australian interest rate decision happening overnight into tuesday morning So i'll be able to update you when i do this tomorrow, but the odds are Of 26 analysts surveyed by bloomberg for this decision 18 expect A cut While eight expect a hold So on the balance We are looking for an interest rate cut there as the the baseline expectation for the rba So to also consider Cool. All right, that's it from me. I'm going to hand you over to sam. I'll catch you in the chat room And I'll wish you a great week ahead. Thanks very much guys Hello guys, good morning everyone. I hope you all had a good weekend and enjoyed the sun You can see some some decent moves happening This morning euro breaking out of that range was Tempting to go either way Last last week certainly to the water the back end and finally did break this sign To the downside early hours of the morning We're keeping a close eye though just where we're trading now. You can see was uh, let me just get that above the The camera there was an important level back on the 21st of Of june so keeping a close eye on on what happens there. We are however quite low down So however, you'd want to keep chasing this market as it goes lower Not too sure here. Can we get a retracement a bit higher? Maybe the way to look at it however over, you know the coming session and Week ahead quite a lot of support obviously below where we are trading now But should we at any point get a retest of this range? Which currently is on the the s1 previous lower the day got to imagine this could be a nice little area Or resistance for traders to be looking at there Seeing this this dollar strengthen up half a percent this morning the pounders snapping down to near the low 127 I guess it's the the back end of its mini range from last week However, you do of course have some Support just a bit below here. So that would be an obvious target Should we get a confirmed break of these lows here? Just hanging around basically on the low that we have back on the the 27 And 127 is a finally a bit of resistance there might be a similar trade if we can get any Retracement tool up towards the previous lows, which has already worked quite nicely at 127 30 Or any Retest of a trend line there for the pound so dollar strong this morning So looking for that to continue as we have broken out the range certainly in the euro But I wouldn't be getting too aggressive just considering how far we've already traveled down This morning and markets that have traveled down gold obviously More so than others just coming on to to test this Level with this trend line here through this this morning. We only had the two touches But you can see it's come back down and and hit this which would be obviously the third test of the the breakthrough And that's acted really well along with an area support from the 21st Quite a key point for for gold trading now. I wouldn't be too Aggressive looking to get short just because of how far it has moved down as well Can we get back up maybe to the previous low around 13 93? That could be a possible point to get in As well just in in terms of a better opportunity to get short this market S&P or equities in general all gapped higher quite significantly of course now pushing on to Well, not too far away from from 3000 in the s&p Which didn't look too likely beginning of last week, but now a decent push higher gap higher as well That looks like it could well come this week. However With all of these markets The the gap field has got to be a trade to to be considered whether that be today or later in the week Or not time will remain to be seen I think a way to look at that In terms of just gaging, you know possible lines in the sand Maybe from the lows couple lows of those days That might be something that comes into play should that break through and then suddenly you're getting a decent move to the downside However, the gap tire it all seems positive But wouldn't be surprising to see a little retracement before we then have a go at Hitting that that milestone the 3000 milestone there as well You can see similar situation here for the nas that gap in higher And it would also be a similar kind of trend line. I'd be looking to have on just for Confirmation that maybe the sellers are getting interested in this gap field The DAX 22 minutes into the open Just pushing higher similar this morning with that gap However, we're just coming off a touch in the last 10 minutes or so Yes, you could Keep a bit. It's not the best trend line in the world But if we were to come back down and find a bit of support and what was Also the previous low of the morning just before the open and that was to break through Then you can start to see a shift in sentiment But at the moment I think going with the flow is the the way to To go here oil You can see these two resistance points. I've got marked up from earlier this morning 60 19 And 68 you seven the reason for those if we just Make this chart a bit smaller to the left-hand side the Resistance we're testing now low the fifth Of may and then just above that was the low of the 13 key resistance points to to have marked up If we are to continue pushing on to the upside And then if we are to come down similar to equities and other markets that have pushed higher Just having that trend line on if that is to break that could be the market telling you that Now the sellers are interested and we look to come back lower So my advice would be certainly for the dollar pairs Look to short higher up rather than looking to to shorten extensions just considering how far they've gone Same with with gold as well. Can we get a retracement to back to one of those previous lows? Before looking to get too aggressive just because we gapped higher in equities doesn't mean it's a foregone conclusion We are going to push on so trade sensibly and wait for the better levels to get in Any questions as usual? Please do let us know, but I hope you'll have a great trading day And look forward to the rest of the week and the sun is shining So that should be should be a good one and yes, of course Good luck to Andy Murray in the men's doubles and possibly the mixed doubles as well And well done to to England. Yes, they'll know we have some listeners from India You had to lose one game I'm afraid and thank you for letting us win Looks like we're going to see you in the semi-finals. So it'll be a hopefully a closer contest I hope you have a great trading day and an excellent week ahead