 Okay, very good morning Thursday the 6th of May. Hope you're doing well and a quick wrap-up of what happened last night The Asia-Pac session some movement in the Aussie on some Chinese comments to be aware of and then look ahead for the day Bank of England meeting of course and Disprospect of tapering what might that mean for the pound and then also going to look at the the kind of afternoon ahead Do you have got things like US jobless claims? We've got the Scottish and UK local elections happening. Are they important? Are they not so a couple things for us to discuss? But let's just start as we normally do with the charts and turns to the clothes on Wall Street A little bit mixed once again the doubt up about three tenths Comparative to the Nasdaq tech suffering again yesterday. So we continue to kind of seesaw the Nasdaq 100 futures down about three tenths one percent the S&P broadly flat So let's kick it off there and look briefly at the charts in the stock in this index futures In the S&P, you know, we were looking at this yesterday The respect of that trend line that we had had going back to on the middle of April at that level at around 41 67 continues to remain one of Significance for the moment in terms of short-term market direction at the moment We're consolidating beneath that line And also finding a bit of resistance here near term on the pick up as European traders come in at a pivot level So between that area on the upside 67 and the low seen during Asia pack trading hours down at 41 51 So we did trade a little heavy at around 3 a.m.. Overnight. I'll talk about that in a moment But the Australian Chinese rift picking up a bit of further intensity that did weaken Australian stocks and the Aussie dollar overnight Which will review in a moment But that move very short-lived as it has been in the Australian products as well The NASDAQ has been the general under performer of the week So let's just have a look at how things are looking there and again that key level We've been having a look at overall comes in at around 13 650 as you can see here from a technical point of view being in play really through April May The market did come up Actually at the cash equity opened yesterday at that level, but as you can see from that wick quite extreme volatility there So even though technically that look good for obviously the retest back up to these levels here for The kind of test and then for the short entry back down using that key level As the the top of that recovery move seen yesterday very difficult I think we actually in actuality get hold of given how whipping the market was at the point of where the potential entry would have had to been But nonetheless, you know, there's a stop-loss region Just above and running it down on the on a daily price activity Looking to target back down to those previous lows and coming out would have offered a degree of a fairly decent risk reward on that trade So and as that we continue to keep an eye on I get it has kind of struggled so far this week with the general kind of value versus growth Play that we've seen otherwise elsewhere In the major currency markets in terms of the Dixie this morning That's trading pretty much flat in terms of Euro dollar the one technically that we were keeping an eye on yesterday was Here which was that kind of run-through on the trend line and then that horizontal support area going back to Resistance in mid-April and support seen on the 22nd The trend line as well as being well respected yesterday And we were kind of squeezing down into that price point around a 120 handle But we have now traded above there As of late US trading hours, and we've used that area now as a bit of a linchpin for support and Although I was feeling a little bit more bearish the continuation of that trend We have seen a decent move back here And so we're now on the the flip side of that trend line Which might help support that price going forward now an important level here for the euro and obviously mirrored in regard to the The dollar index as well and some of its recovery. We've been seeing of that April sell-off So as long as that level holds might well provide a decent floor of support there for for euro dollars a pair It turns a cable obviously much waiting for the Bank of England now to to come out a bit later As far as sterling is concerned for the time being as you can see here in a bit of a consolidation phase at the moment it doesn't really Striking me is particularly interesting right now until we hear from the Bank of England Which I'll I'll talk about in in a moment Gold in the commodity space and then a quick look at oil Again, just kind of pinching the chart a little bit to look at a broader range You know we've kind of gone in these these sections here of consolidation at the beginning of April a break up Consolidation here for between 1763 to the 1800 upside has been really capping price We're trading it around the R1 at the moment on the up tick grab about eight and a half dollars already in The yellow metal in the future space so on the upside just be keeping an eye on that Range high and 1800 psychologically, which has been a good level of resistance so far Which would be about seven bucks above the current price And then with oil Quick look here Kind of explaining the the story of what we've had this was Tuesday's price action Restricted around 6583 and then the API inventories came out, which was bullish report drawdown of Ground seven and a half million prices popped higher We had a slightly deeper draw in fact with the DOE's but obviously largely priced in given the Kind of pre-positioning built on those expectations from the bullish API is so fails We really get our heads above 66 62 but despite the brief look up and around yesterday's R1 level and we just kind of faded that move and now finding some some good support down seen around the 65 handle Which was the low scene on Tuesday yesterday and in the overnight age of pack session So as far as the set up as the charts concerned at the moment We're exactly back to where we were on Tuesday at that resistance point and So 6583 to 65 it was really the range that we're looking at now at WTI for the moment So really I'd want to see these areas perhaps respected for the moment Either playing that range Accordingly or looking for the break pullback and then the kind of classic entry to then follow the prevailing Kind of range move which has been 65 to 66 62 for the moment But without not expecting any real OPEC or or energy specific catalysts at this point in time And so I'd be looking at a range there for for the time being Quick look then at some of the headlines and things to be aware of I did talk about Australia briefly So let's just quickly have a look at that Hong Kong equities were generally higher overnight and Japan actually led the region's gains Remember they were coming back from a holiday being off the first half of the week in less Japan and China Shares in Australia. They did come under pressure Chinese officials Announced a formal suspension of the economic dialogue with Australia now. This has been going on a long time However, as far as the Australian dollar and their local market is concerned, obviously China is the strategically important trade partner So deepening rift between the two nations really doesn't bode well for for the Australian economy But this has been going on a long time So a couple things here then and just really that main reason is we we came down quite sharply in the overnight session However, we've already reversed pretty much three quarters of that move And I think it really is down to the fact that this is just the next kind of evolution of that rift Rather than something particularly shocking or new in that respect So for the moment market a little bit spooked overnight just generally overnight The liquidity volume is quite thin tends to exacerbate the move things have steadied kind of since just having a look at the Aussie Aussie dollar here on a slightly higher time frame for the moment We are still respecting what really is a range between 77 at the lows You can see being in play the last four weeks or so To the high that we've seen overnight around 77 59 so right now doesn't seem particularly interesting But if we get about 15 pips higher, I'd be interested to see if we respect that that overnight session high or not Preferring the kind of quality of the the bottom end of that range Given the respect that it's seen in multiple occasions on the 77 and psychological handle rather than perhaps the short upper 77 59 If you're looking on the range trade So that that was the Aussie situation overnight and then Let's have a look at the the Bank of England that's obviously quite a main talking point of today and Bank of England watchers look for signs of tightening ahead And so what we're basically looking at with this meeting today is focus is going to very much fall on the monetary policy committee opting to slow potentially guilt purchases from their current rate of 4.4 billion pounds a week to allow Purchases under their asset purchase Facility to run basically rather than wrapping up in October early November to the end of the year Now again, this would be tantamount to tapering and I think that Kind of word has almost negative Connotations for as far as market reaction to concerned the Bank of Canada will also saw a big pop in the CAD currency after They decided to taper I do not think that that would be the same case here for the Bank of England And that's mainly down to the fact that the bank has Explicitly said that a taper is likely and so much of the kind of mainstream Expectation here is that that will happen. So it's more about not so much We're drawing stimulus rather than just tweaking it. Let's just slow down the purchases And let's just draw it all out to the end of the year so that there's it's active for a little longer But we're just kind of using yes less force in the volume of what we're buying So in this sense, it's more of a tweak to the taper I would say to that respect as far as policy is concerned for interest rates in the actual QE program size They're going to be unchanged. That will be unanimous The other thing though that this particular meeting is the alternate ones where we get the latest monetary policy report Forecasts, this is when they tell us about what they think about the two-year horizon on growth unemployment these types of metrics And if you think about the last time this report was released was back in February We've had quite a strong improvement in terms of continuation of the vaccination rollout this has led to then an adherence to the proposed and Sticking to the government's roadmap for the reopening of the economy all going ahead so far touch word is planned and So as far as these projections are concerned, we're probably going to get a GDP upgrade you're probably going to see things like in terms of unemployment will likely reflect a lower a lower peak in the Kind of post-crisis pandemic employment figure So things basically reflecting a better situation than where we were just a few months ago The new ones there as far as the sterling reaction might be concerned will be about well, how aggressive are those projection changes? You know how bullish are they about the growth pickup going forward through the reopening? particularly as we go through May June, which is the kind of the main sequence of then ending the lockdown that's been in place and Then what does that look like in the future? On the inflation side of things not looking for too much material change there But obviously inflation as much as seen across the world seem to be picking up in the in the coming months so again Bank of England midday will look out for that an initial announcement and then there's going to be the Virtual kind of conference with with Bailey that will kick off an hour after 1 p.m And so yeah, I'll be on the live feed to go through that with you guys And then as far as the calendar is concerned, what else is there today? Pretty quiet morning. In fact the one thing I just one shot. I did want to have a quick look at was was the Dax and we've just obviously gone through the What we're going through the urex open and futures trade So Deutsche Bors not open yet, but we will open I'm filming this just through 7 a.m. I was just going to have a look on the daily chart on the Dax What I thought was quite interesting yesterday And a few different points here for one a trend line from late October the retest in late Feb And the respect that we've had earlier this week when equity markets globally just came under a bit of pressure back on on Tuesday's session and We've just seen a good respect of that We'd be back above that colored rectangle, which I think was a key area Which helped add weight to the sell-off that we had on the force And so now I'll be looking for perhaps a decent amount of support here and having pushed firmly back through that in yesterday's session But on the upside here on the recovery you can see this 21 DMA They've really capped some of the price activity in facts over this week So Monday and Tuesday and if you to pop a horizontal line there That also was an area of support to price through the week prior to that or last week And so on the daily chart I think the the Dax just to be aware of on this ongoing recovery could find a bit of resistance up at that level The 21 DMA has been relatively good actually over the period of the last month or so having acted as a nice support With that that horizontal technical support as well at 14406 on the prior occasion but as it so Otherwise the final thing to mention is just about on the calendar What's happening this afternoon? You do have the US jobless claims, so expected at 540 so continue to show generally an improving situation on the employment side in the US Having decreased now for a couple of weeks down to around the mid-550s So not expecting a great deal of market reaction to that to be quite honest And then the other thing is we do have the UK local elections I would say with that definitely much more of the media the market focused would not be anticipating any type of Sterling reaction on the back of that event Definitely much more Bank of England focus, and then you also have the Scottish election Where a lot of the focus there Will center around the composition of lawmakers and specifically then how that composition favours a potential new push For a vote of independence now ING analysts have suggested the impact on the pound would be very limited Given regardless of the result they do not expect an imminent vote and in fact a vote on independence if they should so Want that to happen will not happen for a number of years, so it's not a near-term threat at this point But will be no doubt quite a talking point to be aware of speaker wise to wrap it up You do have aside from Bailey speaking in the post kind of statement from the Bank of England You've got one Fed speaker of note, which is Williams who is a voter speaking at 2 p.m. London time interestingly yesterday had a whole slew of speakers from the Fed and That's quite normal in terms of reaction functions They try to manage and reassure markets given the yelling kind of wobble that we saw on the prior day Where she was talking about potentially higher rates in those comments that she walked back and so today You know Simon Williams do also get non-voting members Kaplan and Mester speaking and from the ECB The Gwendoz 1130 in Schnabel at 2 15 so all those speakers centered in the afternoon US session Okay, that is it gonna leave it there let you guys get on if you are watching this and YouTube you've made it to the end Well done, and I hope it was useful. Don't forget to like and subscribe to the video. It'd be much appreciated All right. Have a good day guys