 Hello and welcome to CMC Markets on Tuesday the 29th of April and the weekly market update. And it's a very big week for macroeconomic data this week. We've got a whole host of economic data to chew over from the first iterations of UK and US first quarter GDP. We've got unemployment data from across the Eurozone as well as the US economy as well. And we've also had a number of big earnings stories and M&A stories which are helping to underpin risk appetite and pushing equity markets back towards their recent range highs. However there still remain concerns about what's going on in the Ukraine and I think that to a certain extent is helping to limit I think some of the gains that we have been seeing because earlier this morning I was looking at the charts for equity markets and generally currencies and bond markets over the past four to five months. And really we're not that much different from where we started the year which basically means that we've been range trading for the best part of four or five months. You know when we're looking at that sort of scenario sometimes it's very very difficult to sort of predict where the markets are going to go next. So on that note I'm really going to be focusing on US treasuries because at the moment they're still compressing in a fairly tight range but there could be some opportunities there. I'll be looking at dollar yen, I'll be looking at Euro yen as well and rather than cable because I've been trying to pick the top-end cable for about the past three or four weeks without much luck having said that in the past two weeks has been trading in about an 80 point range which makes it rather difficult to really pick the direction with any degree of certainty. I'll actually be looking at Sterling Aussie because actually that does look fairly interesting. So let's start with the US economy and the US ten-year treasury and we can see from this chart in front of us that essentially price action has been compressing since the beginning of the year. You've got these two converging trend lines, you've got the latest Q1 GDP numbers out of the US economy which are expected to show growth of round about 1.2% and the expectation is from the markets is that we will see a bit of a pickup in economic activity as we head into Q2. Now I think really the key indicators with respect to that are going to be this week's ADP data, the non-farm payrolls data on Friday and the ISM manufacturing data as well. Now you may be wondering why I didn't mention the Federal Reserve rate decision which is due to come out on Wednesday evening. Well it's simply because I don't think there are really going to be any surprises from that. There's no press conference after the meeting, it's widely expected that another 10 billion will be shaved off the asset purchase program and the number will come in at $45 billion. I think it's widely expected that the Fed is an autopilot and I think that's largely being reflected in US 10 year bond prices. We can see on this chart that the prices are falling towards support and yields really need to push through the 2.82% level to suggest that we could get an increase in the value of the US dollar and that's certainly being reflected in the dolly end chart which is also undergoing significant range compression from the highs in 2014 at the beginning of this year and the lows at the end of January and the support line there comes in around about 101.20 the resistance level comes in around about 103.80 as you can see on both charts on the bond price chart the oscillator is looking oversold what we need to see there is a turnaround in sentiment as that price starts to tick up again and alternatively there's a good chance that dolly end could well start to head lower if we can't get through those highs around about 103.80, 104. Before I move on to the next chart I'm going to focus a little bit of what the markets are expecting for this week's US data. Now the ADP numbers for April we're expecting a number in a region of about 200,000 that's going to be an increase on the March number similar sort of increase is expected on the non-farm payrolls number on Friday around about 205 to 10 the unemployment rate is expected to drop back towards that 6.5% guidance threshold that the Fed is no longer following to around about 6.6% and the ISM manufacturing data is expected to improve from the 53.7 in March to the 254.2 and all of this data is expected to signal that the US economy is coming out of the slump that we saw in Q1 and is starting Q2 on the front foot. Any disappointment that the US economy is not coming out of the deep freeze that we saw in Q1 could well put a cap on the S&P 500 it also could put a cap on equity markets more broadly and I think that's really a key factor to keep an eye on. So I'll be covering the US employment report the non-farm payrolls data on Friday at 1.30 the webinar starts at 1.15 you can sign up along the bottom here and I look forward to seeing you then. On the subject of range compression let's look at this Euro Yen chart because this is a classic example of the price action slowly converging to potentially give us a breakout level. Now we've got a whole host of European economic data this week we've got PMIs from Italy, France and Germany. We've had Spanish unemployment that's starting to edge higher again we've got EU unemployment on Friday that's expected to remain at 11.9% Italian unemployment is expected to 13% but more than anything it's the inflation data later this week that it could well dictate where the euro goes to next. A weak inflation number is likely to prompt speculation about a cut in interest rates from the ECB next week so the key levels to watch out for on Euro Yen on this chart here are for 142.80 on the top side which is the upper trend line resistance and on the downside we've got 141 which links the lows from November last year so keep an eye on those levels a weak inflation number could well prompt speculation about easing from the ECB next week not quantitative easing though that remains a long way away with the only rates around about 0.33% we could on the very outside potentially see a rate cut from the ECB but I would be very surprised if we see anything more than that. Last but by no means least ladies and gentlemen I've been trying to pick the top in the pound against the dollar for about the past three or four weeks and let's just say that my success rate has been mixed at best because essentially the pounds been trading against the dollar in a very tight range found plenty of offers around about 168.50 168.60 and found plenty of support around about 167.50 however looking at this sterling Aussie chart might give us a potential short trade on the sterling against the Australian dollar if we look at the highs and draw a line through the highs from earlier this year we've got resistance at 182.60 now the Australian dollar has actually been gaining strength over the past few weeks and months so we could well see further Aussie strength and sterling weakness and that could push the sterling Aussie rate down towards the 178 level and the 200 day moving average and on that note thanks very much for listening this is Michael Houston talking to you from CMC Markets.