 Okay, very good morning to everyone Tuesday the 10th of December. I hope you're doing well I'm gonna quickly switch straight to the charts and have a look at things and how we set up this morning seeing a little bit of Downside pressure just coming into some of the equity index futures seemingly led by the DAX Not that there's a mean anything fundamental to act as a bit of catalyst in terms of the news But as you can see here, we have broken through the kind of range low That was holding up some of the price action towards the latter part of last week on Thursday and Friday We did bounce it around those levels At 13,048 break through that though and the respective s1 on the daily pivots has pushed us down to around the s2 Now which also resides around the 13,000 level for the DAX just below there We've also got the low of the morning of the fourth so midweek last week to keep an eye on as well But as far as I can see as I said not too much in a way of fresh fundamental news I would say more of a bit of a range break of that Exasperated by going through the cash equity open futures volume just picking up so we've just gone Through 8 a.m. Here in London seeping through a little bit into the US index futures Which reside pretty flat at the moment overall In terms of the Nasdaq and the S&P as you can see here But coming back down to around and to keep an eye on the range load that we had Really the wrapping up of the US session last night in the futures market That would be at around 31 of the course in the S&P given some of those moves just a very Mild bid tone observed in the US 10 year here in the bottom right Just having a test at its late Asia Pacific high I've also got just going back to yesterday's price action the US afternoon session high Which would be just around these types of levels with the R1 Sat just about two ticks above that and in gold similarly just moving a little bit higher But again nothing massive for the moment currency markets euro dollars pretty quiet The Dixie is pretty flat if anything a little bit of sterling movement this morning Had what's had a brief look below the range from yesterday afternoons low That was seen around the 31 kind of 40 area as you can see here And that just accentuated a little bit of price movement However, it has settled at around that level for now a few things to talk about there a bit of a PR Blooper by Boris in regards to the NHS last night on an ITV interview You've also got a latest ICM poll which has seen in his lead the Conservative Party narrow to six Which is a bit of reversal from some of the re-widening we had seen some some of the weekend opinion polls But we'll have a look at that in a second Okay going into the news Sam is back. So you're gonna get your full Technical look around the charts as well after I wrap up the kind of main headlines in play And this is one of the main ones to talk about because of course Aside from the obvious which is the central bank rate decisions and the Fed and ECB the UK general election We do have on Sunday the looming potential tariffs of just shy of a hundred and sixty billion dollars worth of US tariffs on Chinese goods However, there was a comment said from last night from the agriculture chief of the US a chap called Sonny Purdue who basically has talked the prospects of those tariffs being implemented down And we've also had the Chinese finance ministry say at the end of last week Just to put it into context that it was in the process of wavering Retailatory tariffs on imports of US pork and soy by domestic companies Now one of the things that has been in question here whether or not they would in fact delay the Implementation of this latest round of tariffs was if there were signs from China of real Concrete commitment to really step up their purchasing of these soft commodities And so hence the reason why on Friday China were making those types of noises in order to avoid This situation looming this weekend. So if anything I don't know how I feel about this in reality because just because This particular chap is talking about the idea that it's looking unlikely that the president will pull the trigger on these tariffs You just don't know with Trump and so I think you still got to remain pretty vigilant Obviously Trump is still pretty active on Twitter at the moment And so I continue to be monitoring that with great interest all the way up until the end of the week Whilst markets are open But yeah at the moment this headline taken on its own in isolation You would say it's a bit of a more positive tip while leaning toward not seeing an Implementation of these tariffs on Sunday, but again, it's a situation in flux One thing that I thought was quite interesting. I know this is a bit small to see on my screen If you're looking at it at the moment, but I did tweet it So if you just go on my my Twitter handle you can't access the higher resolution graphic But I often get some questions about what are the specific goods into what volume is it traded between goods between the U.S. And China and this was just a nice graphic really encapsulating all of that that top-line information So if we were looking at imports So total imports from China telephones for cellular networks and other wireless networks followed by automatic data Processing machines by far the top Going by way of China into the U.S. And then reversing that exports would then be coming out of the U.S. Into China airplanes and aircraft and then of course as we know soybeans to the tune of around 12 and a half billion U.S. Dollars, but again, it can be quite useful to just Be a little bit more clued up Other than then just responding to news as you see it if you just know The general balance of where the trade war is really fought out and on a trade-by-trade basis Generally speaking the rule of thumb the bigger the import exports the more Influential will be to the debate and therefore the more easier you'll be able to pick through what is actually relevant when it comes to Potential market moving information on the trade war. So again, if you did need to look at that You can find it on my my Twitter account Did have some Chinese data overnight following on from the somewhat disappointing trade data We had and we were talking about this time yesterday in terms of exports and the impact of that's having on the domestic economy We've had the latest inflation updates and a little bit I mean not great reading for Inflationary conditions because CPI is spiking and PPI is declining which isn't exactly the best sign For their economy. However, none of this is particularly new I would say and so I don't really see it as too much of a factor To give you the top-level summary here China's consumer inflation climbed to a near eight-year peak in November pork prices doubling But factory gate prices remain in the red CPI November came in up to or 4.5% on the years the fastest pace it's risen since January of 2012 Driven mostly of course by as we know the African swine flu core inflation though importantly Has remained pretty much Unchanged Largely subdued comparative to then if you were to include particularly that food component. So xing that out Other than the impact of pork prices specifically inflationary conditions are Relatively steady at the moment hence the reason why they're in the markets and the central bank of China feel relatively calm about not making any type of irrational decisions about tweaking policy to counteract What's happening? PPI Seems a key indicator of corporate profitability was down 1.4% on the year falling for the fifth month in a row So it does go to show the continued pressure being felt in manufacturing activity at the moment One thing to be aware of is with this CPI elevated number We can expect that to continue for the foreseeable future because we have the lunar new year holiday so the Chinese New Year happens at the end of January in 2020 and That is the peak consumption period for pork as a Particular product and so therefore given the lack of available supply because of the The disease that spread across the nation Then we can expect then that number to remain particularly high for the time being so all in all just a bit of an update It continues the pattern of which it has been shown for the last couple of months But I don't think it really has much translation into market prices and strategies for the intro day today Moving over let's talk about the UK general election. Obviously looming countdown is on we've only got about another two days now until the polling booth is open and Couple things to be aware of One thing is not sure if you caught it, but there was an ITV interview with Boris Johnson Yesterday where the journalist kind of whipped out his phone whilst he was talking to the PM and it was showing a Picture of a sick four-year-old child lying on the floor of I think it was a Leeds hospital Because of the shortage of beds given the state of the NHS and its funding the PM I Guess could have done a better job of handling that situation He basically just tried to ignore it and talk over the journalist Then he eventually due to the journalist's persistence grabbed the phone and put it in his pocket Not the savviest Response that you ever would have seen from a senior politician. I don't think it's going to be detrimental to opinion polls or anything of that nature, but Anything can happen two more days to play for really in this campaigning period And if there's any mud to be slung at this point to alter very late game Then it's all going to come out of the woodwork in the coming days But this is the sort of thing of which of course Boris has been absolutely in his team trying to keep him far away from You'll remember when Trump was in town for the NATO meeting Boris was really just keeping a bit of a low profile And he's done a pretty good job so far of not putting a foot wrong Sam and I were talking this morning Given previous historical political events that we've monitored we'd say really it's it's gone without any Great rural shock so far or real calamities on either side of the political spectrum But as they say two days is a long time in the political world One thing to be aware of though is this there has been a latest poll issued overnight by ICM commissioned by Reuters and The Conservative Party has seen its lead over the opposition Labour Party narrow to six points Now the six-point lead is narrower than the range of between eight to fifteen Points of all of the polls published between Saturday and early Monday So capturing those released at the weekend you remember Pound was a little bit resurgent as we reopened trade for this week Given the fact that it looked like Boris kind of reestablished a fairly commanding low double-digit lead However, this latest one has shown only a six-point gap which puts us back at one of the most narrowest gaps that we've seen since all of the opinion polls have begun The most in one of the most important opinion polls is yet to come and that is This is the you gov website in a bit. I'm trying to show you here is this is when they released On the 27th of November the you gov MRP poll if you remember that was only had quite an aggressive gap up in the British pound at the recommencement of trade on The session two weeks ago on the Monday and that was because it showed a pretty commanding and sizeable Tory majority of the tune of just shy of 70 But the latest new data from you gov's MRP poll was going to be published tonight at 10 p.m and so Definitely this will be watched very closely I would expect there to be a little bit of a knee-jerk reaction upon release of this information the question is is Has that I think it was 68 seat majority of which this calculated has it fluctuated has it got Narrow or not I guess is what markets will be will be looking at and then that certainly could be something we'll be talking about And influencing market activity when we reopen in tomorrow's session The final part I just wanted to comment on was this as we get in towards year-end You do start to see quite a lot of banks putting out their calls for 2020 Just as a heads up peers and I will be doing our outlook for 2020 at some point next next week So before the kind of lockdown for Christmas will put out our kind of view about what do we think about things like Brexit and Trump's Election prospects, what do we think for and year-end targets for the SMP and oil? So we'll go through all of that in a special kind of episode if you like so make sure you subscribe to the YouTube channel to catch that But gold has been one thing I've heard a lot of banks commenting on of late and this was one This was talking about black rock who basically been talking up the prospects for gold I did read Goldman's and I think it was Barclays both looking for 1600 year-end target for 2020 In the yellow metal. So I was just having a look and if we just quickly switch over the charts, you know What does it look like to get to 1600? Well, just changing this chart to a monthly candle stick. So obviously this is much bigger a Longer time frames, but there's definitely some some key levels Really, we got up to if we go back to September of this year. I mean that was where we saw a really clean break came in the summer of what was such a long-term Significant level of resistance for gold and you can see that here around that 1366 and then of course busting through that 1400 when we got through there the kind of race was on then we went straight through 1500 and we got quite close to the top of that move towards 1600 before we saw a bit of an about turn at around 1560 in September And then we pull back to where we are and we kind of settled here at the moment and around that July high Which is pretty much provided the support in the price action in October November and where we are at the moment So it's kind of make or break. I guess a little bit for goals There's obviously quite a few big things still to tackle Whether it's the ongoing trade war and US protectionism Central bank decision-making on the issue of further potential rate cuts or further expansion of quantitative easing and these other Unconventional measures. These are all things in plain of course the geopolitical situations as well Particularly in the Middle East to monitor but these guys seeing 1600 would obviously put us back up at those highs of 2019 a breakthrough that well, you've already got to go about another 40 bucks and we're we're right at 16 And you can see why the market kind of did respond of The reason it did at around that 59 is I mean it's quite a clear level when you start looking on these much higher time friends any breach above there and 1600 well, I Mean that's the overall bigger target I mean we got to go all the way back to really the right in the depths of the financial crisis and the European sovereign crisis So that took us up to the kind of 1800 territory at the time Haven't seen really any other banks looking for that type of bullish scenario But certainly they have looked that by the end of next year and in 2020 We could well be up at around the year-to-date high that we've printed this year Which doesn't seem that far off given where we're trading at the moment would be around 150 Dollars or so from the current price action Have a quick look at the calendar for today And then let's see what Sam's got to say for the session ahead You've got some UK GDP numbers coming out. I think yes to be monitored But how much of a trigger point that will be for for market movement I'm not so sure just given the the implications of the The focus on politics overriding the economics at the moment The GDP estimate these numbers month-to-month reading for October expected at point one do have a range though of Zero to point two. I guess given the previous number was a negative point one any further negative So a breach of the lower bound of the range could well be interesting Just showcasing the continued weakness in the British economy perhaps a stronger degree than some might have imagined You do also get alongside that the UK Manufacturing industrial output numbers and the good trade balance figures as well It's a little bit of a drop of a number of UK economic indicators at half past nine Germans a w economic sentiment that comes out at 10 o'clock for the eurozone again, just given the fact that German data has been so Disappointing and that seems to be very much baked into kind of the the perception at the moment of the current status of the Economic conditions in Germany and the general sentiment looking forward. I don't really expect too much here either Not unless it's spectacularly strong or weak That'll be at 10 a.m. And then from the US session pretty quiet overall in terms of major economic data The NFI be small business optimism index is not really a market mover And you've got the oil infantry is if you're a crew trader 930 then if you're sticking around late the FX you got the you gub MRP model at 10 p.m. Excuse me Okay, that's it gonna hand you over to Sam and I wish you a good day. I'll catch you in the chat room. Thanks very much guys Yeah, hi guys. Good to be back. Let's have a quick look over the We'll start off with the DAX, which as I mentioned at the beginning this technically breaking those loads that we had on Friday Decent little pop down and and the level which is marked up their 13,000 the low that we had back on What was the fourth of this month? Definitely wanted to keep a watch on it and as we know with the DAX just because it moves at 8 1 direction doesn't mean it's gonna continue that way for The remainder of it as as we saw quite clearly Going back here to the second But yeah, definitely keep down on that the S1 13,000 and the low the the fourth a push below there Then I think you'd you'd like to be aware of just this area a bit below that 50 points or so below that low that we had on the second and the third You can see The overall top part of that range that we broke out on the second the retest of those levels held up Really well at the back end of last week So decent push lower Of course with any retracement keeping an eye on those previous loads of the day that we did break through For some resistance if it was to come up But it does look like we're gonna get a bit of a test of that 13,000 Eurostocks is well on its current low right now and those levels to be aware of I mean for Eurostocks really I'll be focusing more on 3646 the high that we had on the third couple of lows on the fourth the fifth As well so a couple key levels coming up for Eurostocks There as well and of course that is to keep going lower We might well see a firber push down in in US stocks Which are just coming to test the low that we had from Yesterday 31 31 Obviously a decent push through you know on Friday bit of a bit of a quieter day yesterday As expected non-farm payrolls on Friday the Monday typically is always a quiet day We had this trend line which has been created from those the top to the all-time high So definitely have that on should we get a push higher? I mean for it to get there you'd have to go through I would say 31 39 As well, which was some solid support yesterday before a push lower So 31 31 to the downside 39 to the upside and then that trend line and the R1 as well I would say is definite point to have marked up below the the low of yesterday quite a key level 3121 but also we've called it 29. So some important price action going back here to There's this end of October 26 the higher that we had Friday morning also the S1 in the mix there as well So that's a pretty key point now. I'd have marked up on the S&P and just having a look here now It's gonna put this on 60 minute. I mean it's quite steep, but you can see Let's have a look We've broken any significant trend lines. You can see yes. They really It's going back to that late last night Got a bit choppy but closing below that trend line could be relatively key for the S&P So keep an eye on the DAX this morning to make me give it a bit more direction But quite a lot of support just below where we're trading 31 26 and the S1 now I'll be keeping a watch on there have a look over the euro Yes, well last week just say came up to the top part of that range a couple of goes trying to get above it It couldn't certainly has held up very nicely So if we are to get up there again, it would be the well a really You know another multiple test of that point how much longer can it can it hold but for now It is decent move low on Friday of the dollar strength a bit of a retracement seen yesterday So it'd be worth we say it'd be worth getting on a trend line from those lows to see if we can get a third test And maybe then get a bit of a breakdown of that the R1 today is pretty much yesterday's high It was also some resistance that we saw back on the sick and the R2 For today matches up quite well a bit of support before the non-farm payroll number came out So technically some nice resistance points to be aware of for the euro That you would look to to have on there and certainly I'd be having this trend line as well or potential trend line If we are to come back lower However, how much is going to happen before the Fed tomorrow and even Brexit and Brexit the general election on Thursday I'd be patient with these really let the market come to you before looking to get to Involved of course going into these key events But yeah, certainly the R1 and the R2 would be levels that I would would have marked up as a key resistance point along with that trendline to bottom the pound I mean just looking at the last that one two three sessions You would call it a bit of a new range really and to be fair You can make that four because if we go back to the the price action on the fifth after breaking out The day before you can see we've been quite well respected with those highs R1 there as well A couple of goes trying to get above it yesterday around that level around 31 75 Just couldn't do so the support point that we've got at the moment from the low of the day Well respected yesterday, and then Friday evening as well before s2 below that holds price up as well So the pound those would be the points. I'll be keeping an eye on I actually this morning got out of All pound relate positions and all positions medium term That I had left and I think it's probably wise to to take that approach as we do go into The key event you can see obviously a decent push really starting from the beginning of December I'm training up at levels. We haven't seen for quite some time not just against the the dollar But of course the euro as well your a pound was trading down at levels that we had not seen since It was May 2017 Let's just remove that pivot there and make this chart a bit smaller You can see yeah not far away from those lows now that we had back in April 2017 and a bit of support Just a below where we're trading from the night of May On that year as well. So the euro pound has been been drifting lower. Whether this would be the amazing time to take it along first. They will perhaps give more of More of a cue on that but yeah your own pound probably not too much in the way of big price action ahead of these Events Wednesday Thursday, but just something to to be aware of their gold Obviously after Friday's push lower Would have scared a couple of the balls, but we're still not below that low that we did have Back on the was it the yeah the 12th of November However, we are to start into perhaps look like we're gonna build up one of these trend lines from those lows And you can see you know, well, you know the way gold can move once they break it really can push Low, so just be aware of that As well as the fact that we are perhaps just looking to get in a new range over the last well yesterday and a bit of Friday Session as well with the R1 yesterday's high and and also was a bit of a low from Friday as well And then the S1 trend line and one two three tests of that point as well coming in around 1463 so that was where I'd be keeping an eye on for the gold and potentially waiting for a break of that trendline To the downside R1 technically looks pretty good Although you'd have to be keeping an eye on what stocks do as well and the Sierra stocks was charming another go at trying to push lower Quick look over at oil We're having a look here definitely Just with the fact that the low from Friday and Monday You can see there those high are lows getting higher and those highs getting lower just starting to get squeezed Arguably just made the top part of that pen and they can see Respectively really well and having another test of that 59 dollars as well and the high of the day So keep a watch on that I'd have to say for the oil and maybe looking for a break as well 5902 and then suddenly you're looking towards the highs that we did have yesterday and Friday Evening around 59-25 or so a break of the the bottom side and the pivot Then you could be looking down towards 5844 I would say you'd be likely to get some decent support And of course any parts of that lower part of that trendline that makes that pen and as well Quick look over what the DAX is doing. It's having another go down at that s1 As well that we just tested and the 13,000 just below So that really is a key level to keep an eye on if that goes You've got to imagine that US equities are going to have a bit of an attempt down at well certainly S&P at 31 31 that we were talking about as well. Any questions as usual, please do that I don't know of course will be on the micro throughout the day, and I look forward to You guys joining us Wednesday evening and Thursday evening as well