 Hello and welcome to CMC Markets on Tuesday the 7th of July and the weekly market update. Pretty much Greece has not been out of the news for the past seven days and I think the likelihood is probably not going to be out of the news for the next seven days, maybe seven weeks or even seven months. But aside and away from that there has been something else going on which hasn't been particularly well reported but it's no less important. And that's the sell-off we're seeing in China and this has significant, I think this has significant repercussions for our own equity markets here. And I certainly think that's why we've been seeing an awful lot of weakness, not only in the Chinese A50 index but also the Hong Kong 8 shares index as well as the European markets over here. FTSE 100 is now well below its 200-day moving average. The Euro stocks 50 has now just broken below its 200-day moving average and the German DAX is now starting to close in on its 200-day moving average. Now, let me just dial you back to last week when I said you need confirmation of a break lower. We haven't seen the DAX break below the 200-day moving average. We actually haven't seen it touch it yet and we haven't actually broken below the lows of the last few weeks either. We have, however, seen the Euro stocks 50 do that. So what we're looking for on the DAX is confirmation of the move lower that we've seen on the Euro stocks 50. But be that as it may be let's have a look at the Hong Kong 8 shares index because this particular chart is very, very interesting. Now you may recall a few weeks ago at the end of one of my weekly videos I showed you this chart that we've broken out of a double top and we've pushed aggressively lower in the past four or five weeks. And the fact of the matter is we've actually broken a key Fibonacci retracement level from the lows that we saw in the end of October to the highs that we saw in April and May. We've also broken below the 200-day moving average and what we're seeing in China at the moment has all the makings of a significant sell-off which could have further legs to go. We've seen Chinese authorities pump in extra liquidity. We've seen another rate cut and that doesn't appear to be having any significant effect. And the risk is that this sell-off could actually start to gain traction in the event that all of these small investors who waded in on margin suddenly get waded out as they get margin called. So now that we've broken below the 200-day moving average currently around about the 12,000 level and we've broken below the 61.8 Fibonacci retracement level of the entire up move from the October lows, the prospects are that we could well see a sharp move to 11,000. The only thing that would negate that would be a recovery back above the 200-day moving average. Now, it wouldn't be a weekly market update video if we actually didn't talk about what's gone on in Greece because it's still relevant. It's relevant to Eurodollar and for quite some weeks now I've been actually fairly bullish on Eurodollar despite the fact that Greece has acted as a really big cloud over the currency pair. However, when the facts change, I change my mind and you as a trader need to bear that in mind as well. Don't get wedded to a particular outlook and we've broken below 110.50, we've broken below the 100-day moving average and we've also broken below the lows that we saw last Monday at 109.60. That's potentially very negative for me and as such it's making me think again about my overall buy-the-dip strategy on Eurodollar. And I think the likelihood is the next target now that we've broken below 109.50 is the may lows around about 108.20. That remains the next key level. So this renewed dollar strength is in spite of the fact that some of the economic data that we've seen over the course of the past few weeks out of the US hasn't been particularly conducive to expectations of a Fed rate hike in September. Last week's payroll numbers, while good, weren't spectacular. We saw a 48,000 downgrade to previous months. More importantly, average earnings actually came in at 2% well below expectations of 2.3. So that suggests inflation remains weak. Oil prices are coming off, commodity prices are crashing. That is a significant deflationary environment and it makes me think that the prospects of a Fed rate hike in September still remain fairly remote despite what a lot of commentators are saying. That isn't stopping the overall dollar strength that was characterised at the beginning of the year of reasserting itself. When the facts change, I change my mind. Cable has broken its uptrend as can be seen from this daily chart in front of you right now. So the trend line that we're looking at at the moment is drawn from the 145.65 highs. We've broken that today at 155.20. We've also broken below the 50-day moving average and the 100-day moving average, which suggests that we could well see a retest of the 200-day moving average around about 153 and the June lows at 151.70. What would cause me to revise my opinion of a further weakness in the pound? I think to see a stabilisation in the pound, we need to see a rebound back above 155.30. Just to reiterate that thought about further cable weakness, we're going to look at the four-hour chart here. We can see the break of the trend line, the long-term trend line. We can see a break below the support at 154.70.80 and we can see now the next target, which I've drawn in from the June lows, the horizontal line at the bottom at 151.70. Somewhere in the middle of that, we've got the 200-day moving average. So that's it for this week. Until the 21st of July, as I will be off next week. Thanks very much for listening. This is Michael Huston talking to you from CMC Markets.