 see you. Thank you Mike, how are you? Welcome traders to this afternoon's live discussion where we are going to revisit the topics we had in the last discussion with respect to Covid's pandemic, the impact of the Covid pandemic, how the US elections played out and impacted some of the scenarios that we discussed in the last session. And what we're also going to do today is we're going to look at where we are, we're going to take a sense check on where we are in terms of the pandemic, review some of the recent price action that has been driving these markets. We're also going to look importantly now at the vaccination rollout and how that's likely to impact the markets going forward and how that's going to help drive some of the strategies that me and my fellow market strategists are looking to employ over the coming weeks and months. And we're going to finish up by looking at the most important thing, the tail risks. What if scenarios and I'm going to cover off where we see some potential hazards in future days. So welcome again to today's session. My name is Patrick Munley. I've been actively involved in the financial markets for over 15 years. I'm a money manager running multi-million dollar portfolio. In addition to my money management business, I'm the head of trader education for FX career swap, leading a community of 130 retail traders, helping them to become consistently profitable professionals. And I'm also a resident market expert at Tick Mill providing market strategy and analysis. And I'm dialing in today from a pretty windy Mallorca. So you'll have to bear with me in the background. I've got brilliant sunshine here. I've got all the shutters shut because I've got 100 kilometers of winds going on the background. So please bear with me. So let me introduce you to the panel. Joseph Tahrir is a market strategist for Tick Mill Middle East. He's a certified financial technician. He's been actively trading the capital markets since 2010. He specializes in Elliott Way theory and using advanced methods to analyze the market, enabling traders to better understand the dynamics in capital markets. Thank you. Hi, Patrick. It's my pleasure being here with you today. Thank you. Good stuff. Okay. Also from Germany, we have Mike Siddell, who's a professional trader, Tick Mill strategist and financial market coach. He's been in the markets for over 20 years, full-time trading since 2012. He's a financial market coach since 2013 as founder and CEO of Investorschüler. He's also a contributor and author for Traders magazine. Guten Nachmittag, Mike. Hello, Patrick. Hello, all together and welcome for all of our viewers here. This afternoon, I'm pretty happy to be the second time in this panel discussion. And I hope we can have a good time and I invite all of our audience, if you have any questions, don't hesitate to write it down into the notepad. And we will take this and talk about our opinion for the traders. And I'm really looking forward to the things that we will discuss today during the next half an hour, 45 minutes to the development of the economy during the COVID-19 wave two. So let's go on. Great stuff. Thanks, Mike. And last but not least, Carlos Valverde has been in the capital markets for over 10 years. He provides technical and fundamental analysis for the forex markets for Tick Mill's Spanish and European client base, as well as market intelligence, macro and news reports. He also supports clients in terms of trading, analysis and execution. So buenas tardes, Carlos. Muy buenas tardes, Patrick. Welcome, everybody. Thank you very much for the introduction. I hope you are enjoying the Mallorca sun. Not like in Madrid. It's a bit rainy, a bit cold, but I'm very happy here to be here again with you guys and with the fellow traders out there that are willing to expand the knowledge or try to get an insight for this year. Thank you, Patrick. Excellent stuff. Okay. So as I say, we're going to break this down into four sections. I'm going to start now by a quick review of the first wave of the COVID pandemic. And we're then going to look at how that impacted market. So globally, sadly to say at the moment, there have been over 105 million confirmed cases of COVID-19. This includes over 2.3 million deaths globally. COVID-19 pandemic has triggered the deepest economic recession in over a century, threatening health, disrupting economic activity and hurting well-being and jobs. Extraordinary policies have been required to walk the tight ropes towards recovery, which will shape the economic and social prospects for the coming decade. The economic downturn resulting from COVID-19 restrictions has been concentrated among certain types of businesses. The global economy measured by gross domestic product, shrank by record levels. Following the start of the first lockdowns last March by September 2020, after a summer of relaxed measures, GDP was still down globally compared to February. Services such as hospitality, bars, restaurants and hotels recorded almost no output during the lockdowns. But industries such as information and communication, where staff could largely work from home, saw little change really compared with the February data. Consumer facing services have since bounced back somewhat, but have been hit again by the second round of lockdowns. At this stage, it's difficult to separate temporary losses of outputs brought about by the coronavirus restrictions from longer term behavioral changes that could impact industries for years to come. While some industries shrank by up to 90% in April and May last year, others recorded marginal growth, leading to unprecedented economic support, stimulus and wild market swings. And to just recap some of those market movements, I'm going to hand the mic over to Joseph and he's going to bring us up speed with his perspective. Thank you, Patrick. So as you mentioned before, as a quick recap for the first wave of COVID and the impact which we saw hit the market like really hard. So basically after the first wave, after the contagion from Asia started to the rest of the world, the capital markets and I will be mentioning especially the equities here were retreating, but were still in a good shape at first. After the World Health Organization, the WHO declared the COVID as an outbreak, as a pandemic, as a real pandemic, and the acceleration and the spread of the virus have caused many government to start the shutdown and the strict measures like the travels, etc. So here the reaction of the financial market started and it has been really aggressive and violent. Comparing Patrick to the moves we saw back then in the financial crisis in 2008, the fall of the equities was really hard that we witnessed. So of course, most of the investors shifted to the safe haven, which especially the gold. The gold already was any surge, but like this crisis pushed the gold further to new highs. So if I want to mention like technically what happened to the Dow Jones especially, the Dow Jones, as you mentioned in the previous panel discussion we had, the Dow Jones was entering in a sideways market and in need for a correction or a corrective pullback in order for the prices to be interesting again, let's say to buy. So the Dow Jones was trading near 29,500 near the psychological level, which is the 29500 or the 30 level. So a pullback of way four was really expected in order for the trend to continue. And technically speaking, we were waiting for a pullback to the previous low, which was the 21,400, which was a really far number technically, but it was expected as a pullback or a big way four. We're talking about the big trend here. So what happened on the Dow Jones was really a crash, of course, but like it was at the same time a correction for all these years and the uptrend that was happening. And talking about the apex market, let's talk a little bit about the currencies. After the hit took place after the COVID first wave, we saw the dollar index specially surging from 95 level and rose to 103 level. So basically because the dollar has acted the safe haven currency among traders during the times of intense, let's say market stress in the past. So that's why all the investors chose the dollar index as a safe haven currency because first of all, it's the most liquid currency in the world. The US economy is less reliant on external demands than much developed countries. And of course, the spread of the virus at the beginning was relatively less aggressive in the US than Europe and Asia. So that's why we saw the dollar index surge at the beginning and we saw the hit for most of the currencies. The new lows in the euro reaching targeting 106 again, the low. Here we're talking mid at the end of February and mid-March. We saw the new lows for the pound hitting 1.14 again as a double button. We saw the Aussie retargeting 0.55, which was a huge big number for us. 0.55 is 88.2% Fibonacci retracement for the grand cycle of the Aussie dollar. Speaking of year 2000, reaching to 2011 high, which is 1.1, if we take all this grand cycle and we take a Fibonacci retracement, the 88.2% was at 0.55 level. So it was a really important level for the Aussie dollar as well. And of course, the hit was mainly for the countries which demand or like which heavily is dependent on the production of commodities, especially oil, because after the hit of the oil and all the lockdowns and the minimal demand on oil, let's say barrels, we saw the oil hit almost zero dollars for the May contracts. We remember all this, the crash, the sharp fall in oil. So all the currencies for the countries dependent on the production of oil such as the let's say the Russian rubble, shredding around 16%, we saw the Mexican peso, Colombian peso. We saw the losses as well in the Brazilian and South African currencies almost hit 10%. So basically after all this crash, the market reached an interesting levels. In case of the Dow Jones, which is the almost 19,000, the Aussie dollar, the euro, the pound, all these, let's say the equities and the FX market reached an important levels. Here we started talking about a possible scenario of recovery, technical one, which might be a V shape recovery, a U shape, an L shape. And of course, we witnessed the V shape recovery after all this, the surge again in the Dow Jones and targeting new record highs. And as well, we saw the pound and the euro and the Aussie retraced from the lows and now trading at current levels. So basically, the recovery was very fast and it was a V shape recovery. This is basically all in all, it is more recap about what happened, the crash and the recovery phases we witnessed in the market after first wave. Excellent, Joseph. Thanks for the recap there. And I guess what we want to quickly do now is just move on to talk about the second wave, I guess, which we've all had to live through. Second wave, I guess, challenged but didn't really derail the market consensus as such for this V shape global recovery from the recession that Joseph was just talking about. More official stimulus and vaccine rollouts should help this recovery from most market consensus in the second quarter of 2021 and boost the reflation trade as such and keep risky assets supported. We have a blue wave in the US Congress, which means much more aggressive fiscal stimulus up front, but higher taxes and potential over regulation to come in the medium to long term. On the data front, 2021 has started out with a bit of a wobble, most notably in the mainland China where all the PMI data, both the Kaishin and the MBS, suggests that the recovery has lost momentum at the start of the year. And as a result of restrictions being put in place to stem the spread of the new infections over the new year holiday. US jobs data was also weak in January, the pickup in payrolls did offset less than a quarter of the drop seen in December and total employment has only since risen 0.2% since October. Although across the world, the number of COVID-19 cases has rolled over in some of the worst affected countries from a month ago, restrictions in place are hurting economic activity. The good news is that in aggregate, the global number of new COVID cases is slowing. Despite risks around new variants of disease, vaccine rollouts are accelerating and more candidates are being approved from new vaccines. The light at the end of the tunnel is becoming slightly more visible, even if the pace of the movement towards it is slowing somewhat. There are also some better news on the activity front. Specifically, Carlos mentioned this to me yesterday in India, where COVID-19 cases have fallen sharply and PMI data points to a faster pace of recovery. Asset prices in general have soared, meaning that those who aren't on the property ladder or invested in the stock market may find it even harder to do so in the future. Financial markets have been gripped by the sharp swings in many risky assets in recent weeks, be it within the stock market, cryptocurrencies or digital assets. I even anecdotally heard of someone paying US$100,000 for a video of a basketball dunk in late January. Whether these are one-off events or signs of a bubble or a broader shift in demand towards high-risk assets will be interesting to watch. From my perspective, just in general talking about the US dollar, we've obviously seen a little bit of benefit at the beginning of the year. We started the year, everybody bearish the dollar, and so we obviously had to have a position wash out. That was accompanied by US Treasury yields peaking, but this strength in the dollar will likely suffer from diversification flows over the long term. The European recovery has stalled because of COVID, and despite the Brexit deal, the BOE and the ECB are still investigating and talking about negative rate potential. So this leaves the US dollar as the ultimate counter-cyclical currency and could remain under pressure as a global growth and global trade recover, and as corporates and central banks have to sell US dollars to buy their home currencies and liquid proxies respectively. The Democratic Party's control of the US Congress and the presidency could also result in higher taxes and over-regulation and reduce the appeal of dollar assets. These, combined with lingering concerns about the US twin deficits and the US dollar's over-evaluation, could encourage some further diversification out of the US dollar in the long term. In the near term, however, a more aggressive financial stimulus and better control over the pandemic could give Treasury yields and risk sentiments a boost and thus help the dollar regain some grounds. What I'd like to do now is hand the ball over to Carlos, and just for Carlos to recap his perspective from the last session in terms of some of the trade strategies he was looking at implementing and how he's managing his book at the moment. Carlos. Thank you, Patrick. Thank you guys. Yeah, more or less you did very well summarize of what happened like Joseph Sef the last year. The B-save recovery was crazy. Nobody was expecting this kind of recovery. But not only this, markets are doing new highs. Markets are disconnected from the reality in my opinion a little bit. But from the past webinar we did the last session we did. I was saying that not now, not this year or last year, well maybe this year, but that stocks for me are overvalued. Like Joseph said, they are very expensive. It's very expensive. You are paying the profits of the guys that bought five years ago, 10 years ago. The prices of the stock market is very high for the versus the production versus the activity. The economic activity is going down every day. So economic activity down, stocks up a lot of depth. I think it's a cocktail for at least retracement in my opinion on the indexes. It didn't happen last year. I said in the last webinar that I was expecting a recovery, at least a drawdown, a small recovery and I'm still expecting it. It doesn't mean that I'm going to go and sell tomorrow because the risk on is, you can see that there is a risk-looking theme on the market. Everybody's looking for risk right now. We have the Fed, the Federal Reserve behind, supporting all the time with more cheap credit. We saw today the consumer price index is flat. That's good for the Fed because it means that they will not need to raise rates early so they can wait a bit to raise the rates of the Fed. That's very good for America and right now, but the problem is inflation in theory should go up. So the dollar is under pressure. Commodities are up actually in my opinion. I expect the commodities to keep expanding and I said this before, the commodity is an interesting market. Soybean, corn, they're going up like crazy. Hello, Unita. I see some comments from the people. So my expectation for this year is maybe a reality check for the traders. Why? Because indexes mostly on America, North America indexes looks like there is no penalty, only long. There is no possibility of it to fall down. And this is going to be a reality check for many traders that are now buying late. Actually, my opinion, they're buying a bit late. So I'm expecting a drawdown on that. The dollar is under pressure and I think I see a kind of currency war right now. I can see this. I can feel this kind of currency war where every country is fighting to have the currency not very strong. Because it will not help for export import. So you want to have your currency not very strong. So I'm looking at the markets. If you check, for example, the best indexes for the last year in terms of performance, the first one is the KOSPI 200. It's South Korea index. It gained a 40% rally, a 40% increase in the last year starting from today, 52 weeks. KOSPI, Shenzhen, the Hansen, Taiwan, Shanghai. For me, Hong Kong, India, Asia is now the main investment hub. I can see the inflows of money going from Europe and North America to Asia. So this year is hard to know. It's impossible to know, but I think the indexes, they will have less easy way up. I think it's going to be a bit more resistance at the top. One of my views. There are many things, but maybe Mike want to, maybe Mike want to. No, thanks for that, Carlos. I also have been watching the indexes. I was actually watching this trade today in the S&P above 39.20 and it's starting to roll over here. Don't get me wrong, guys. I'm not saying to go short any index. I mean, they are strong right now, but I'm expecting at the moment I can see the first fear, movement down. You see this kind of fear, panic. When I see this first panic, maybe on the second wave down on the second panic. Maybe it's a time for, but now it's crazy right now. Good, sir. Carlos, Mike, do you want to bring us up to speed on your thoughts from the last session and how they've played into how you're managing your trading book at the moment? Yes, of course. I want to. That's the reason why I'm here. I have to apologize. My background is to see at the moment. My OBS has crashed, but I'm happy that the camera is still working. I hope you can hear me loud and clear. Great. That's good to hear. What's happened? I don't want to talk about the things that we have heard about from Carlos and Joseph. I would like to talk a bit about the biggest difference between the first and the second wave of the COVID because of what happened on the market is known, but I notice from talking with our private traders, many of them don't know the difference between COVID wave one and COVID wave two. The biggest difference is that during the first period we had a complete lockdown and we had a lockdown also for the productive companies and that was a huge problem for the worldwide economy because we had interrupted delivery chains and that was a really huge problem. The situation now is different because we have the producing companies can still work. We see this here in Germany. We see this in USA. We see it in China. We see it in Europe. This sector is still working, not on the levels that we had before Corona, but they are still working. These are good news for the economic development, for the job markets, and of course for all the debts that we have at the moment because someone has to pay it and as long as the producing companies are worked as money flow during the economies, that's a huge difference. The worst thing is of course the limitations for the smaller companies, small and mid-sized companies, especially in the sector of hotel, restaurants, leisure, traveling and so on. They are under huge pressure and they have really huge problems and I really hope they get help out from the governments, but when you have a look to the indices you see nothing of these problems because of in the large indices overall in the world are the big companies and the big companies have not these huge problems as the smaller companies have. That's the thing, why I think the indices are where they are at the moment, raising in bullish uptrend and it doesn't matter if it's too expensive or not when we hear to the markets, we should follow the markets and I'm pretty sure the market will show us when stocks are too expensive and as long as the market is the opinion he can or that the market can earn money, make profits on the increasing indices, for example we will see they will invest. This is what we see here and the economic recovering process is also something that we can see very positive at the moment compared to the first lockdown where everything was locked down in lockdown. At the moment, last year it was I think in May or June here in Germany, in the moment where all the shops and restaurants were open, people could go back to work, we had a complete different world. People were back in the cafes, restaurants, so they had money, they got short time work and money from the government for that, so we have no liquidity problem whether in the big companies or during the payments, the payroll checks for the staff and the companies where everything is fine, so this is the situation that we had the last time and I guess and these are the expectations from the markets at the moment to when we get the next recovery, that means when we come back from the current lockdowns and going back a little bit to normal, it doesn't matter if we get the same problem in October, November, December this year, the time between is very important for the markets, for the currency market, for the index market and for the commodities of course too and this is what I'm looking forward at the moment to see what happens and we see huge movements, the indices are strong, gold and silver are pretty much or pretty close to the US dollar development, that means a strong US dollar will bring pressure to this commodities and slowing down a US dollar will bring the prices for silver and gold up again, this is what I see at the moment and then we have to talk about the oil market, the oil market it's a bit different at the moment, we are in a very strong market and that is going up, we have a very strong uptrend at the moment and it's not correlated to the US dollar and in my opinion is this a sign for a recovering and producing economy, that means the more the economy, the weak economy is recovering, the more energy needs the industry and the more energy the industry needs, the more oil do we need and the second thing is the more the economy recovers and the lockdowns are going back, the more private traveling activities will we see and this is anything that will also increase the demand of oil and this will push the oil price to the next levels and this is what I see at the moment for the next months would I say and one thing is also very important, Carlos was talking about the central banks, there's a big difference between the European central bank and the US central bank, both have the same problems, both work more or less in the same style but I think the US further reserve the Fed is doing a better job and when we have a look what they have in planning for the next months, they have in mind they want to have a very very strong job market, they won't, the most people should work in USA, this is the first thing and the second thing is that the debt rate is so huge that they can't stop the purchase program so we will see very cheap money also during the next months and this will push the markets up and this one would weaken the US dollar but there is one thing that is pro-US dollar and this one thing is the bond market, we see it at the moment five years, 10 years, 30 years the interest rates are increasing and that means when we see in the not in the near time future but in the next five or ten years, decades the interest rates are increasing at the moment and that makes the US market especially the bond market more interesting for international investors looking for risk, the risk less bond market and when they start to invest in the US bond markets there is a higher demand for the US dollar and this will bring more demand on the dollar and bring the prices up so it's a very crucial moment at the moment if we see prices below the 90 or above the 90 US dollar for the future, this is crucial for the next month what I say. Totally agree with you there, great review Mike, okay let's move on to the third section here and start to think about one of the key dynamics not just for the markets but I guess for the global population as a whole and that's really to do with the vaccine development and distribution around the world. Is my microphone on? It is, okay. So the vaccinations in January were really largely as anticipated by the markets but the rollouts is diverging really across developed markets while the UK is progressing pretty rapidly the EU has been held back by limited supply and the US face distribution challenges what we can expect with respect to vaccines to deliveries is that we should see some type of acceleration in Europe and the US as supply disruptions ease and new vaccines arrive. Markets assume that the Johnson and Johnson distribution which starts later this month in the US in March in the UK and in early April in the EU and we also have the no vaccine kicking off in April in the UK and US. Estimates suggest that the US and Germany have administered only one-third to two-thirds of the available doses respectively. This reflects a lack of planning and a mismatch between supply distribution capacity and demand in the US and the precaution you stop piling that's been touted in Germany. Markets expect substantial improvements in all countries. The current consensus is that the majority of the European population should be vaccinated by mid-year. Important points estimates at which 50% of the population have received their first dose are April for the UK, May for the US and June for the EU. Germany to hit its 50% point at some time in June and at the same time Italy's vein followed by France in July. However in South Africa trials point to a reduction in vaccine efficacy in preventing moderate disease from new strains. Crucially however the vaccines appear to remain effective at preventing severe disease and hospitalisation. Combined with rapid UK and US timelines this supports the view that the UK and US hospitalisations should decline further in coming weeks and months. As such the market expects a robust annualised Q1 GDP growth of about 5% in the US and to start easing of UK restrictions in March, setting the stage for a rebound in second quarter GDP in the UK. While the timelines for the European GDP and the dissemination of the vaccine look like they will continue to hobble GDP growth in Europe for the coming quarter. One of the highlights or one of the dynamics that I've been talking about is the higher vaccination rates amongst G10 countries are actually contributing to the currency outperformance even with the control for the detriments of exchange rate performance such as risk sentiment or commodity prices and relative interest rates. Vaccination rates are having a pretty large and discernible impact in currencies like euro sterling which has been under the gun since the disparity between the performance of the EU vaccine dissemination and the UK has become so prominent and we've also seen a similar dynamic in the dolly yen. Part of the reason for this is that the large leads the US and the UK have over Japan and the Eurozone in terms of vaccination rates are driving this currency dynamic. Importantly, even when taking into account the relatively higher COVID infection rates in the US and the UK, relatively higher vaccination rates are leading to the US dollar and sterling outperformance versus its counterparts. Vaccination rates have less but still significant impacts in the euro dollar, Aussie dollar and the dollar CAD. So this is an interesting dynamic which is potentially a short-term dynamic but one that certainly should be paying, the traders should be paying attention to. Mike with respect, oh sorry Carlos with respect to the vaccine rollouts, what sort of dynamics are you seeing coming into play? Thank you Patrick. I'm not sure, I'm not sure about this, about this view, I'm not really sure because we were talking yesterday with Joseph also said that the market already discounted this, the market is already taking into consideration that everybody's gonna get vaccinated more or less. The problem is maybe not the vaccines itself, it's more the results of the economy of the countries that are not getting vaccinated, the measures, the measures that the politicians are taking. In Spain for example, we have a very dependent service country, restaurants, hotels, tourism, so it's doing a lot of damage, the lockdowns, a lot of damage, last year 100,000 companies closed in one year, so mostly small and medium businesses. So I'm not really sure there is a direct correlation, I didn't check very profound but I'm not really sure if there is a direct correlation between the strength of a currency versus the amount of people getting vaccinated, I'm not sure but I think the process is gonna be really a slow hassle, it's gonna be a lot of hassle, a lot of, I think the process even in Europe is not gonna be as easy as we think. Some people they don't want to get vaccinated, some of the vaccines already, the percentage of healing are going lower. Also we are having problems, the pharmaceutical companies they are having problems because now they need to mass produce millions of vaccines. So this means they need to invest into logistics, development, more bigger laboratories, factories and the quality of the vaccines, some of them as they are being mass produced, they are going lower. So it's a matter for me, it's a matter of if the general opinion trusts this thing. So if the general opinion trusts the vaccines and the companies behind them, maybe the politicians will follow, the people will get the vaccine and we can open the economy. But so far even with the vaccines still we have the same measures. So I'm not really sure if this is gonna be the end of the problem in my opinion. I'm not sure. No, I totally agree. We're a long way from being out of the woods. Joseph, do you have any thoughts with respect to the vaccine, rollout and how that's playing into market dynamics? Patrick, thank you. As Carlos mentioned previously like the market already discounted the first and the big news like as the first shock to the market that the vaccine is here from Pfizer and many other companies. So basically as technical analysts, we need to see the reaction of the market and then predict what the next move will be. Basically before the vaccine was like invented, the vaccine has triggered like at the end of 2020 has triggered a burst of optimism that the global economy is poised for a powerful rebound in 2021. And let's be honest, the game changer was the vaccine. However the hope behind the vaccine is one thing and actually seeing the evidence of a vaccine is quite another. Like some are saying that the results of the vaccine from Pfizer and Johnson and Johnson as you mentioned AstraZeneca were better than expected. That's why they are still optimistic to see good returns in equity market this year. Like I will directly put the relation between the vaccine and the equity market because the first shock wave will be directly impacted to the equity market and then we might let's say analyze and project what might happen to the other let's say products because as Carlos mentioned before, the risk sentiment is on at the moment. So basically all the eyes are on the Dow Jones on the S indices on these numbers. So in order to analyze let's say the current levels of the equities, let's go back in time the early stages of the rally was powered by the fiscal. We said we said it in the previous panel by the fiscal and monetary stimulus packages from the central banks trillions of dollars. And then there was a shift from optimism to near euphoria in my opinion, of course. First of all it was triggered by the wind of Joe Biden for the presidency, second by the boost of the of the big doses of stimulus. And last but not least the vaccine, which is like was from from several companies. So the vaccine have cemented the view that at the end of the tunnel there's there's light. All right. And let's be realistic the vaccine. Let's let's call it the vaccine happy markets at the moment at the current levels. I will be calling it the vaccine happy markets. So it might be becoming concerning to the immediate economic dangers we might face and the enormous long term damage that this pandemic has already already caused. And does suggest there is a near term danger we might be facing. All right. Like technically speaking I've been talking about with 31,500 a lot of times like previously on the Dow Jones we've reached we've reached this number today. This number is a good number. It's a good resistance level. We might see a pullback. It's not a trading let's say maybe advice but let's be honest like this level is good breaking 31,500 would open more room to to 33,000. So basically we are trading near critical levels and let's not forget as as Mike mentioned the equity market may be damaged as well if the bond yields he mentioned the bonds as well the bond yield continue to climb higher as well. So this might damage as well the equity market. So after all these risks what did the vaccine have got forbids negative effects or something we might let's say surprise be surprised with. So as a conclusion like with without like digging into details of the vaccine, I will be watching current levels for potential set the cell setups right after I get this cell setup after I get the confirmation I will be looking for the next move in the markets and for the potential or probable scenarios that might happen. Good stuff Joseph. Yeah, I mean I agree with you. I put a piece on the the Tick-Mail blog there referencing this 3930 level in the S&P and we're just like I would like to add quickly to what Joseph says before it reminds me it's very important one thing is the good news of the vaccine that is already discounted. This is one thing and other thing completely different is if the vaccines are gonna get better the numbers the economy because it's gonna take a lot of months. So one thing is the vaccine we have a vaccine some companies we have it now we are gonna see if it's really helping the economy why because this will put pressure on the Democrats pandemic emergency emergency program to put one trillion plus so even with the good news we have the vaccine but the vaccine is not helping the economy okay let's do the packets let's do one trillion packets so this is also for me very important to watch out the government the American government will feel pressure to approve the packets if even if the people are getting vaccinated the economy is going down so this is important also for and it's connected with the bonds as Joseph said it's like a chain of events bonds and dollar stock markets it's gonna be a crazy year in my opinion put your belt on Mike so you just want to give us your view on how the the vaccination is going to play into the market dynamic yeah we we we all speak the same language in that way and I can also say what the other said too the vaccines are priced in they they were a very huge trigger for the recovering of the markets and I would say now at this time where we are now I think the vaccines are very important for the for the further economy recovery especially what Carlos said in Spain for hotel restaurant leisurely and so on this is very very important to get this and this will probably give another boost for the economy recovering because of when when all of the restaurants and hotels are opened again they will have a huge demand and people will travel again and and we will see this in the future but when we have a look to the to the markets that we trade every day here with stigma our things are in that time much more important and this is what the federal reserves the central banks are doing the governments are doing with the programs to protect the the economies of the own countries this is what I would I say much more important and the third one is a thing we have also a question to this we have a question to the related to inflation and and this is a thing what a lot of traders have not not faced till now many people say all right we have so much money around the world the central banks print money how we can read it and and this must be bad for our economy and I'm totally different opinion we have the modern money theory and the modern money theory is saying exact that what the central banks in Europe and in in in in Asia and in USA are doing they they give a lot of money they spend a lot of money they print a lot of money and but as long as this money is not in the in the in the wallet of the people in in in a country as long it will not be spent so the money from the from the central banks will flow into the into the banks and into the big companies and they don't use it to to purchase things they use it for our purposes and this is why we don't will see an extreme high inflation that other people might in mind because of when they think to the printing of money during the central banks and this is very very important that means think about to learn a bit the modern money theory and you will see all of the the actions from the central banks in a totally different light so this is what I want to say and for this one we will see the impacts more to the currencies how Carlos or Joseph said we have to look as analysts to levels that are too expensive or too cheap and these are levels where we are at the moment more often have a look to the to the US dollar it was extreme low and now we came a bit back maybe we see a bit more recovery or have a look to the New Zealand dollar or the Aussie dollar they are extreme high at the moment and they reach extreme levels that we have many years before and when we see where these levels are situated and when we learn from the history what happens over there we can just expect when we are in a huge one of these huge extreme levels we will see the the reaction to the opposite and this is what we should have in mind as analysts and traders to find the right places and to write the trends from the support or the resistance I have one question I want to ask him something because it's interesting sorry Patrick you said that and I agree with you that the packages the helping the money is going to be on the companies it's going to be on the banks it's not going to go straight into the people's pocket and this is important what do you think with these packages with these packages relief this money printing insane do you think this will translate into more jobs into the economy this is the question I have do you think it will be translated the printing into more good jobs or growth yes it will but let me explain this why and I know I don't know I'm asking myself and yes and companies what are they're going to do with the money great Carlos Carlos we too live in in in different countries and Germany is not to compare with Spain where you live and these different economies have different things to consider but one thing is extreme important to to understand this what the money will do and the first time that I was in direct contact to the money printing was in 2008 when Lehman crashed so and this was the first time as I could see how the printed mummy helped to support the markets and to support the international job market with Bernanke no with Ben Bernanke it was right and and this was the first time as I understood what's the difference between the old world and the modern monetary and since then I see how good the modern monetary works and it works fine and since then I know thousands of people they say this is not good what the central banks are doing and it was in 2008 and have a look where we are now in the indices we are much much higher the economies developed extreme good even if we had some pullbacks in between this is absolutely normal but the money printing helped the economy for the indices and the companies commodities and currencies are totally different currencies swing between extreme high and extreme low levels and this is what we see when the central bank is printing more money as another one we will see for example when the the european economy print much more money than the euro at the us economy was we will see a weaker euro and a stronger dollar and what will happens with the chart we will see the trends and and this is what we can see here but for the for the economy for the job market and so on I think also for the future it's it's for the moment a pretty good working system good stuff okay guys we're going to move into the the final section here where we're going to look at at some of the tail risks and when we talk about tail risks what we're talking about is the the what-if scenarios the we have the known known known unknowns I guess so with respect to the markets obviously the pandemic is is far more than just a health crisis it's also affecting societies and economies at their core while the impact of the pandemic will vary from country to country it will most likely increase poverty and inequalities at a global scale making achievement of social care programs even more urgent without urgent socio-economic responses global suffering will only escalate jeopardizing lives and livelihoods for many years to come immediate development responses in this crisis have to be undertaken and with an eye to the future development trajectories in the long term will be affected by the choices countries make now and the support they receive there are to my mind three implications for tail risk at the moment firstly while the regular virus flare-ups and annual booster shots and some lingering consumer risk aversion are likely in the coming years it seems as if the staggered reduction of hospitalizations and fatalities amongst the vaccinated should drive some type of global growth secondly what about a severe downside risk in terms of the evolution of a new strain for which vaccines would not sharply lower the risk of disease and hospitalization this in turn would require another round of vaccination which would hammer global GDP again thirdly we have the scenario whereby there are risks as Carlos was talking about earlier of reinfection and the reinfection actually being more deadly and negating the efficacy of the vaccination in general and how this then would impact not just developed markets but also the potential for it to cripple emerging markets who are not in a position to revaccinate as rapidly as we could see in developed markets if these scenarios play out so those are the three scenarios I'm thinking about in terms of what we could be looking at down the line with respect to the virus and the implications of modeling out or thinking about where we can see some potential terrorists guys do you want to chime in where you're thinking on what you're looking at maybe Joseph if you want to kick off there like Patrick I have nothing clearly in mind for this major point you mentioned but like I would like to shift like from these ideas into directly what's happening now in the markets and looking at the retreat retreat in the DXY in the dollar index like after these we have seen news trains in South Africa we have seen news trains in UK and we have seen some vaccines that doesn't work on these news trains effectively or 100% let's say so basically we have faced like a little bit of this tale of this insight we're talking about or you mentioned so basically what happened and we are seeing more depreciation for the dollar index what would be technically and for the markets for the capital markets and I think all these all the followers and all the participants today would like to hear what is the best let's say scenario or what what is the best possible product to invest in for the 2021 like in my opinion going or let's say choosing high yield currencies for example we we didn't see this uptrend in Aussie and New Zealand and outperforming at the beginning the Aussie and New Zealand were outperforming all these other currencies I expect the dollar index to keep weakening in the in the coming future even if we face some up and downs for the for the vaccination or for some news trains that might pop up I would like to see gold and commodities after this correction after this pullback is is what's happening now I would like to see gold maybe topping to new highs maybe reaching 2300 2400 and 2021 maybe I would like to see the the dollar weakening again against the Japanese yen and Suisse so I would like to to let's say choose the high yield currencies if I would like to invest in currencies and I would like to sell the dollar index against all these major currencies and choose commodities for instance so basically this is what I would think of nothing clearly about what would be happening for the mutation or the infection as Carlos mentioned so basically I shifted my thoughts to the markets directly. Good stuff Carlos. I kind of agree with Joseph that is nothing clear right now it's the beginning of the year the last Fed meeting Powell said that they are not increasing the program it may mean like like a break you know like because maybe the Fed didn't don't like the pandemic and the new package of the democrats maybe they don't like it because it will raise inflation up and they will be forced to raise rates so anyhow what I mean is in terms of the markets right now it's a weird mix because we have risk on risk looking but uncertainties to the maxes in many things because we don't know the process of the vaccination we don't know the new strains for example in Spain here now the AstraZeneca I think or Pfizer the government recommend not to get vaccinated if you are more than 55 years old so it's a bit weird now this I'm not sure how in my opinion I like the Swiss franc it should be something that we need to look at it because already Euro Swiss is already going down not very volatile but it's something that we need to remember that usually franc the Swiss franc when things get really nasty and really bad usually the Swiss franc goes higher because it's a safe heaven so we need to look for Euro Swiss a short we need to look for dollar Swiss also dollar gen I'm not so sure it's interesting it has been forming a triangle for years that it never broke I have a very important level on the dollar gen is the 104 600 if it breaks below maybe it will help but I'm looking into Swiss franc I'm looking into wait a little bit to the next month march may to see how the market get I mean the information we receive from the economies and the central banks we need to still to digest it's very early for me to know this year it's a bit early I agree with that on that side with Joseph that we need to wait for the market and see so far I think dollar it has very positive things but it has also very bad things the dollar right now because it's printing a lot I don't think it's under pressure and the commodities are outperforming right now mostly everybody the commodities and the stocks basically so I will wait wait a bit a little bit but I will be looking for safe heavens this year if things goes a bit bad gen a Swiss franc gold maybe silver even bitcoin I can see some inflows from stocks maybe to bitcoin I can see that the bitcoin is receiving a lot of attention lately but for me it's very parabolic it's very steep the angle so buy it now bitcoin for me is not a good idea I will wait and see we need to wait I think in my opinion a little bit yourself Mike back again great to hear what you say Carlos and Joseph what we do is we know actually nothing exactly like like like always like always or what we can do is we can we can have a look for for chances we should always have in mind the risks of a market and Carlos you mentioned the Swiss francs you must imagine this the Swiss franc is a safe heaven currency I forget to say that the Swiss national bank don't like this at all but I know and and and and you can see this the interest raised the interest rate in in in Switzerland is minus 075 this is so extreme expensive to park money in the Swiss franc but they do it this is absolutely insane so what can happen here Patrick you asked me what expectations for this year it's like like Carlos said it's it's really hard to say it from now and I say this the whole year long because of I never know what comes tomorrow and the day after tomorrow for this reason I always follow what the market is doing but I have I have a scenario I have a good scenario and the worst case scenario maybe the worst one at first one and the worst case scenario is that we will see something like last year a hard winter a spring where we can see lockdowns that are getting back things are getting better and then after the summer the virus a mutation or whatever will come back and force the economies in the next lockdown in the third wave this is the worst case scenario that I have and this one in mind we should just have a look into the to the history of of the the equities or the currencies or the commodities that we want to trade we just have to see what happens last year and I'm pretty sure something similar will happen this year too and the good scenario is that we will see oh sorry for the interruption the good thing is when we don't see the mutations and the mutations bring back the pressure into the markets that we can see a good recovering year a good year a recovering year for 2021 and when we see the latest earnings in USA for example they were everything in the in the in the in the in the mean thing they were very good over the expectations of the analysts but you must say the analysts had had pretty low expectations but we see the economy is recovering and when we don't see a third wave this is very positive and we can probably see more and more recovering markets and that will be fine for commodities for the stock markets but for the currencies I'm really not sure what will happen so we have the euro we have the central banks we have the the US dollar we have the Fed the Fed can raise the the interest rates that will affect the US dollar when it's not too high for the interest rates and there are so many risk on this side that I'm really not able to say what we will see in two or three months so my suggestion is let us have a look into the charts and follow the money good stuff well hopefully we can we can reconvene again in a couple of months and we'll have a bit more information to play with and be able to to give some more insights and that concludes the the conversation between between us here what I guess I'd like to do now is is open up the Q&A and see if anyone's got any questions they'd like me to to put to the panel happy to do that for the next five or ten minutes or so if there are if there are any questions well guys it's looking like we've done a a world-class job of explaining everything that appears to have any questions at the moment that the central banks I think Europe the european central bank is more open to even lower rates lower rates even more or keep printing more versus the the Fed the Federal Reserve is already not so eager to lower so this will put pressure on the euro dollar to the downside maybe we can see an euro dollar at the end of the year of 1.13 1.12 because we can see that also the 1.22 level in the euro dollar is not good for Europe they don't like that we don't like this strong euro and you can see that already Christine Lagarde said on the last meeting that they are even open to even lower a little bit more or increase the packets versus America that North America USA the Federal Reserve is already more a bit more hawkish so this may put a downside pressure on the euro dollar forget to say okay we've got a question from fires with respect to inflation or deflation of lockdown some studies suggest that a big part of the stimulus program won't be cash printing which suggests that we won't face bigger than expected 2% inflation yeah I mean I I don't see I don't see real inflation raising its heads in certainly in the US anytime soon we just had a very another very weak CPI print I mean to my mind what's happening with all these stimulus checks are you've got a lot of retail traders or ex sports gamblers piling into stocks cheap stocks and you know they've got time on their hands and some chips to play with so I think that's that seems to be what's driving or that seems to be the main use of these stimulus checks in the US it doesn't appear certainly if you look at rental accommodation in in New York for example we're not seeing any uptick there the move appears to be out of the cities in the US and so we're seeing a reduction in terms of rental inflation which was a big driver and the same can we say say for healthcare over there at the moment we're not seeing any real healthcare inflation and now with Biden a Democrat back in the White House we're likely to see some type of Obamacare type scenario reinstated so that's not going to really drive inflation from the healthcare channel which we normally expect to see does anyone else have any thoughts on on inflation in the US and the stimulus programs yeah maybe I would like to say a few words to this and the the the simple clear message is we just have to have a look to the bond markets this is the one thing and the second one is that we should have a look to the commodities the soft commodities and the commodities that we need for the industry and these are things they are really really real and we see at the moment that prices for soft commodities increasing in time and the prices for steel or copper or whatever are also really really high at the moment and when this is a trend that will last for for very very long time then can we see maybe a much higher inflation and this can be pressure putting pressure on the markets but it's not yet the time to to to be worried about this we should have this in mind but it's in my opinion too early to face this too much and that's right yeah that's that's right Mike I mean the the commodity drive I think that we're seeing at the moment is basically all premised on the idea that you know hopefully markets are going to be reopening and it's that reflation trade where where like like you said we we're yet to see if that's actually going to play out in real time another question here what about commodities gold and silver were we where we are witnessing a sell-off in gold on an increase in silver I don't think I don't think I mean there's a there's a small difference between gold and silver silver is needed for the industry gold not really this can be a bit different but when you see the long-term charts from gold and silver they are pretty pretty pretty much the same and I'm not really sure if you see a sell-off or in gold and an increase in silver I would say they go in long-term the same direction we were witness from the we witnessed the the the work of the reddit Wall Street guys in the last week they pushed silver very very extreme high in a very short time but then there was nothing to do more and silver crashed down and now it's similar to gold I don't see this when we see a huge rally in gold and silver I would say it's a bit related to the US dollar and when we see that people need a safe haven but you should always have in mind what happens last year as the third just the first wave of covid came gold and silver were also sold like every asset in in in the markets because of people needed money and when you need money you don't care about of the worth of gold and silver when you need money you sell everything what you got and take the money to pay your life and your bills okay final question here that we'll cover you need to ask for the moment which one is best to invest in gold or dollars and we're going to leave this with Carlos to chime in yeah yeah well I don't know the future if I will know the future I will not be here right now sit down here and we need to keep in mind that the gold silver ratio is going down like crazy okay this is very important it means the gold silver ratio it means how many ounces of gold of silver I need to buy one ounce of gold it's going low I don't have a asset to share but usually the long story short when the gold silver ratio is going up usually is a risk a version safe heaven and environment when the gold silver ratio is going down usually is a risk own or risk looking environment so for me it's really hard to tell for me right now technically speaking I'm not interested into gold until it break the 1860 level to the upside 1860 I need to see this coming back again I'm not very interested into into gold right now for a long at least for a for a buy it's hard to know what is better you need to but also depends on the time of your trade if it's going to be one month one year one week so in my opinion I will prefer dollar right now in my opinion against gold but this can change anytime what I think is the risk is on so the people are putting money into stocks bitcoin maybe pound this kind of stuff dollar it's a bit weak now but I don't see people putting more money in gold right now so I will wait and see okay well what I'd like to do on behalf of everyone here is thank all of the panelists for joining us today Joseph Carlos and Mike we're going to wrap this one up here we're going to hopefully join you again in the coming months where we will see how some of the dynamics we've discussed today start to play out in the markets and where put the potential next set of opportunities to better so for me here in a window Mallorca goodbye and we will hope to see you all again at the next event thanks very much everyone for attending thank you very much thank you Patrick thank you Joseph thank you Mike thank you everybody for being here have a nice trading day everybody see you soon it was pleasure thank you bye bye bye bye thank you everybody