 Good morning and welcome to the weekly market update with me David Maddon today's date is Monday the 22nd of March 2021 at the time is just gone 919 GMT and it's been a it's been a slightly negative start to the European training session The kind of big stories of the past 24 hours 48 hours has been We've seen a lot of volatility in the Turkish lira We initially on when when the currency markets opened on Sunday night and learn sell-off in the Turkish lira That that that has since rebounded Some of the most a large of the gains that were initially lost have been recouped But there's still the huge volatility surrounding it. This was all sparked By the kind of reasonably abrupt decision to replace the head of the Turkish central bank With this that a spark fears about whether will there be capital controls? Which is why we see a lot of volatility in the Turkish lira with that and this in the kind of session overnight in Asia There was a kind of a push towards or push towards the Japanese yen a classic safe haven plague a classic example of risk-off sentiment Also here in Europe this morning. There's some mild concerns that some banks in Europe might have exposure to Turkey or Exposure to the Turkish lira and that is kind of ripply and to a small to a small extent that's kind of running through The the Europe the European banking sector not overly concerned We've had situations of this in the forward where where the Turkish lira is going to a lot of volatility It's often been that it's often time at both times in the news for a few days, but eventually things have kind of petered out Also the big story the travel sector airlines are very much in the red this morning there is There's kind of concerns over recovery hopes There are fears that that a number of countries in the EU are Infrared another wave of the other of COVID-19 cases But also there's this kind of height in tension between the EU and the UK in relation to the AstraZeneca vaccine This there's other fears that this week that the the European Union might have vote in favor of halting Exports exports of the of the AstraZeneca vaccine to the UK That would have a given quite an option knockback knockback The UK's plans to reopen the economy so the kind of airline sector has been quite badly hit On the back of this we will have to see if things play out on that on that front But relations between London and Brussels hasn't hasn't been great recently in recent weeks and months So that's going to be probably the focus of this week's Kind of this is one of the main focuses of this week Speaking of this week as I always do I run through the week had article and then I go through the major indices the major currencies And the major commodities so the week had our article can be found on our website Cmc.com under insights under latest news and analysis I think going from there I You can click to click on the article here scroll down. We had full year figures from Kingfisher this morning They owned the DIY shop B being Q Over group figures were were well received full year adjusted profits up 44% the dividend was reinstated DIY companies around the world did very well this year Basically because because because of because the government of house lockdowns force people to stay at home that essentially prompted people to spend money sprucing up their homes Adobe systems will have their first quarter number is coming out tomorrow also tomorrow game stop This company has been in the news a lot in the last couple of months It's an experience a lot of volatility in late January and into February It's been what it's been kind of one of the stocks that was being talked a lot about on reddit I kind of the horde of retail investors were kind of pushing around the share price of this company So the update from this is going to be very interesting because essentially You know there are a lot of people there's some people arguing that the current fact the current share price of The stock grossly overvalues. It's what is grossly overvalued in comparison with the fundamentals with the state So the first four the fourth quarter numbers are going to very clutch you very closely closely watched That being said about concerns over its high evaluation that hasn't hasn't stopped the share price from going even higher It has been much higher than its current price. So We could continue to see a lot of volatility in that stock tomorrow morning We have UK Numbers the actual headline of London figure itself It seems to be kind of less important these days just because the numbers are being skewed by the furlough's the furlough scheme So the kind of claim it cut numbers is considered to be a better representation What's actually going on in terms of the UK labor market? On Wednesday with the flash service with the flash manufacturing and services PMIs for France and Germany These two countries are the largest economies in the European Union and the Eurozone Also, what's going to be the focus is how badly their services sectors are holding up because they got quite tough lock Restrictions in those countries the manufacturing sectors are doing relatively well But services which are bit which are big components of their overall economy. That's under pressure Also, what's coming at Wednesday is UK CPI inflation has been and we talked about a lot recently Essentially between central banks having extremely lucid monetary policy governments have having very loose fiscal policy That's been that that's that those policies were brought in to support the struggling economies In the wake of the lockdowns But there's a lot of talk and fear that inflation is going to jump and if inflation continues to kind of increase at a Jumps at a very very high rate and it feels like inflation is getting out of control That might prompt central banks to tighten their monetary policy sooner than they would like as a way of curbing inflation So keep an eye out for in the CPI numbers and what that does to UK guilt heels Sydney world the cinema crowd have their full year numbers on Thursday This is this is this is one of the companies which obviously had a brutal time in 2020 because of the lockdowns But they've managed to see they've managed to survive this far and they're a company which stands the benefit should we have a Should we have the UK economy operating with it? Did it's no refrictions in the next few months? Bear in mind the EU the AstraZeneca vaccine Export story because I could push things back a few months in terms of the UK economy and likes a Sydney world reopening Darden restaurants over in the US similar similar story It's very much a reopening of the economy story They were clobbered amid the mid the lockdowns and the pipe and the pipe restrictions But they've survived so far and they think continue to kind of cling on Hang in there as it were they send the benefit whenever the US economy in USA to kind of fully function again First half numbers coming off from Smith's group on Friday morning also on Friday We have UK retail sales for February keep in mind the January figures were brutal They declined by over eight percent. What are we going to expect? What are you going to see? Commerce are expecting a rebound of two point two percent for February which should be obviously coming from a low base But it'd be rise will be welcomed on the less and also we have US personal spending on Friday as well Simulus scenario traders are asking themselves are Americans going out going to be going out and spending money because let's face it That's what that's what's going to drive us On a pull us out of the economic situation that we are in I start off with a major indices starting off with the footsie with hundred You can see here at the footsie with hundred head is highest level and but a ten or ten or He was about a let month high ten month high was achieved back in January Had a move to the downside and it's broadly been moving higher since but notice how in the last few sessions It's been turning over. It's been rolling over ever so slightly. It's still above the fifth of the moving average So that that's a positive sign on the fifth of the moving average comes into play at six thousand six hundred and fifty We're currently at six thousand six hundred eighty five While we hold above the fifth of the moving average It's likely at the wider upward trend of the last few weeks is going to continue Keep mind the broader upward trend since November's been quite strong If you can hold above the 50 moving average the the the the near term and the more on the longer term Upper trend remains intact if you can move on higher from here We could be looking at retesting the mid-march highs of around six thousand eight hundred and twenty two Beyond that we could then be looking at targeting the highs of January twenty twenty one Just this year is January and if you take all that level there We could then be looking heading up towards six thousand six hundred Any move to the downside could find support from this yellow line here the one for the moving average in a six thousand five hundred and eighteen I feel a fairly large move below that We could then look heading back down towards the lows of early February in or well just north of six thousand three hundred The six thousand three hundred Is it is not too far away from the two hundred a moving average It's red line here because that comes in the play six thousand two hundred and eighty one Turn your attention out what's going on over in Germany The at the German markets the DAX at an all-time high at the back in the last week So that really tells you how strong sentiment is and even though things are a bit weaker today The German market hasn't really moved the whole lot Which is good going considering what's going on in relation to Turkey What's going on in relation to the to the EU UK vaccine story and the possibility of economies Remaining in under restrictions for longer So the broad rougher trend is still very much intact while we hold above this blue line here the fifth of the movie average in a 14,056 it's like at the wider upper trend is going to continue should that be the case We could be looking at retesting last week's high just north of fourteen thousand eight hundred I think I'll be on that we can then be looking up to fifteen thousand But what I do when I talk about is the shape of the candle that was created on a Thursday This kind of has a potential to be a what's called a gravestone doji and doji's represent in decision Not to say that when a market has an upward trend a very This case a very strong for trend for weeks and weeks and months and then you have a bit of you have a Doji or what appears to be a doji? I'll say the market please turns over on south then and there It just represents indecision and if you apply that a comment if you think about logically if you have some indecision after a long Bullish period one of the options is the market turns a bit lower But it could easily be the case that the market drifts a bit lower tension back down toward this zone here around 14,400 back towards the 50 movie average before resuming the wider upward trend So keep on that on those areas For for potential areas of support should he move to the downside Turning our attention to the US with the the Dow Jones The Dow Jones backed up an all-time high at the back end the last week since then it's been moving a little lower We can see here on the MACD indicator the MACD histogram positive momentum is tapering off that coincides with that at a client in the actual price of the Dow Jones so for the time being it's seen that at the kind of the bulls or the What's in it that the bulls are running out of momentum or you could argue that the bears are kind of Just about again control if it do to kind of drift on lower from here We could like a head back down toward this zone here the lows of early March in around a 31,744 And the move below that could take us back down towards the 50-day moving average is blue line here in a 31,458 If though the kind of broad upward trend continues, we could be looking at retesting the The recent all-time high north of thirty three thousand two hundred I don't know if you go beyond that we could then be looking up towards thirty three thousand three hundred four hundred so on and so forth Now turning our attention to what's going on over the S&P five hundred So the S&P five hundred also Like the backs and with the with the doubt with the Dow Jones Wrapped up an all-time high at the back end of last week, but since then we have a fairly sizable sell-off on Thursday and also on Friday and with that but notice how even though we've had a pretty brutal sell-off very bearish candle here Look at the body of this of this candy the red rectangle. It's very bearish Completely in God, you know, it's completely in God's the body of the previous day as candle So very bearish indeed had a lot of declines were posted on Friday Today's session the candle that the range has been quite narrow Which could be a sign of the markets picking up which way to turn but notice how it's still culturally above the lows of last week And it's also well above the 15 moving average here this blue line here Which as you can see acted nicely as support in early March and if a metric has been of importance in the past It makes it more likely it'll be of importance in the future So while we hold above the blue line the 50 moving average at 3866 it's likely at the kind of broader upper trend Will continue should that be the case? We can then be looking at heading back up to heading back up towards the all-time high that was set only last week And if you go beyond that we could then be looking at targeting 4,000 But even if you do drop below the fifth and moving average it wouldn't necessarily negate the kind of broader The uptrend that has been in place for quite some time. Excuse me Because even if you do drop below the fifth and moving average We can then potentially head back down toward this zone here The one really moving average comes in the play at 3751 and also notice how the lows of early March aren't too far away from that metric So keep an eye on the entire zone from 3723 to 751 Turning our attention now to what's going on with currencies I mentioned about how the Japanese yen is on relatively well because there's uncertainty in relation to what happened with the Turkish lira the US dollar Recently has become a pretty popular safe haven place. So we have seen some moves We have seen Oftentimes the time Money flow into the into the green back whenever there's been uncertainty in stock markets And we take a look at the price action of the furor dollar In January hit its highest level your dog hit its highest level over over two and a half years going on a three-year high But since then the market has been trending lower and You had a multi month low in At the beginning of the month it had a few had a few rebounds up towards the 120 level didn't quite get there But it remains below it and why we remain below the kind of 120 mark We also in below the fifth removing average is blue line here in a one spot 2060 while we were in we were in below those areas It's likely that the kind of more recent near term negative friend is going to continue and should that be the case We could like a heading back down towards my first off the bat Excuse me the eternity moving average the red line in at one spot 1847 and a move below that Could take us back down toward this area here in a one spot 18 And if you do have a fairly size of break below one once by 18 It could take us down towards the lows of early November in around one spot 17 of 45 on the other hand If you retake 120 and if you retake the fifth of the moving average this blue line here We could then be looking at retesting the high scene in late February and then beyond that We've been looking up towards the highs of early January which as I said were the highest in over two and a half years Let's take a look what's going on the pound versus the US dollar Excuse me, so in February in a late February similar scenario of the pound hit his highest level in nearly three years versus the US dollar Since then it has come off a bit not known as how the client and sterling I've been against the US dollar I've been far smaller than they they they declined suffered by the euro versus the US dollar So we're still holding above but pretty much sitting on this fifth of the moving average Which comes into play and at one spot 3826 while we hold above that metric it's like the broader upper trend is going to continue Notice how the fifth of the moving average active nice to your support in both mid-December and also late December So the broader upper trend continues We could be looking heading back up towards the one spot 40 zone And then if you go beyond that because I'm gonna be looking heading towards the multi or highs that were set in late February In a one spot 42 41, but even if you do drop a lot of the fifth of the moving average You can see that this yellow line here the water will be average active nice the support back in early November So if a metric has actually support in the past and makes it more likely it'll act as support in the future But once again, there are no guarantees and that comes into play the water moving average in a one spot 35 91 One of the issues with a month a come on to Gold now commodities gold and and and an oil and the US dollar is traded Well all commodities are big commodities are traded in in US dollars But they've been a particular strong inverse relationship between gold and the US dollar. So When recently we've seen strength in in in the US dollar It's not really coincidence that we've seen you know gold not too long ago at the beginning of the month was down At a nine month a long since then gold has been moving higher We could see here's a change of negative momentum deposit momentum on the MacD indicator MacD histogram But it hasn't has to fail to get back up to get at the 1760 mark. It's failed to get back up towards 50 moving average. So we could be a turning point for gold should the dollar strengthen continues to strengthen We could see Gold turn over itself yet again head back down towards the lows of late of early March and then back down towards 16 70 and if you go below that we can they be looking heavy back down towards 1600 On the flip side If if gold does matter to the kind of stage a strong recovery from here if you take out 1760 We could be looking any backup towards the fifth of the moving average in 1792 There's a few kids season consolidation in rather metric and even an active as resistance on the 10th of February So if you take out if you head back up if you go beyond the 50 moving average We could then be heading up towards 1800 and then beyond that the connects begin to keep an awful with the two at a moving average in at 1859 And then lastly turning our attention to what's going on on the oil market So the oil market and a pretty brutal sell-off last week On Thursday dropped about 7% Essentially concerns about continued rising stockpiles in the US. Where is the worries that? The words that Europe is in for another wave of COVID-19 that's called a potentially not demand These all kind of came together and hit the price of oil But despite the fact they had a pretty brutal decline on Thursday had a bit of a rebound on Friday And the lows that we saw on Thursday have yet to be retested. So we're still off the lows of the last Well above the lows of last week We're sitting comfortably above this blue line here the fifth of the moving average Which has been so active as both resistance and a support a number of months ago So while we hold up on the fifth of the moving average in a 62 spot or three It's likely the broader upper trend is going to continue should that be the case We could be looking at retesting the kind of 68 zone and then beyond that they can retesting the recent all the recent Highs that were set in March and there and those those were like, you know, 13 14 month highs that were set at the beginning of March That's all from this video. Thank you for listening. Have a good 20 week and good luck