 Good morning. Hope you are well. It is Thursday the 5th of December just having a quick review then of the charts this morning and I'll run you through some of the main headlines that I'm looking at some German data this morning. You've had Japan Unleash a new round of fiscal stimulus to keep Recession at bay you've got an update on the trade wars and then British Pound continues to extend on gains and then seeing some Fluctuation in the price of oil going into of course the first day of the OPEC meeting in Vienna Which commences today first day of a two-day meeting. So that's what I'm going to talk about So I'm not going to look at the charts in too much detail. I'll leave that to Sam But overall from a general sentiment this morning relatively Neutral flat I should say stock index futures marginally positive You can see in the center here in the Nasdaq and the S&P coming up to around the high of the range From yesterday's session Likewise in the DAX pretty similar Probably a bit of a standout is the top chart here, which is the British pound which I Got the call wrong Have to put my hands up to that. I actually thought, you know, the pound will come under some pressure I thought that I thought that US data was looking pretty Solid as it had been for a period and I thought that would exert a little bit of Downside pressure, but the unwinding or flip-flopping of Trump on the trade war In combination with some of the weak data that we had ADP yesterday and with the conservatives Whether or not somewhat assisted by that obviously horrific attack that happened on London Bridge But have started to maintain now What is a double-digit gain back a 10 percentage point lead in latest poll this morning and all these factors helping lift the pound to A new high here this morning So yeah pound continuing to press ahead, but there's a few things I'll talk about there in a bit more detail in the options market, which goes to show that people are Not complacent. There's a lot of downside protection being taken in the options market for potential Calamities that still could happen With the prospects of a hung parliament probably more likely than anything else of a labor led government for instance Otherwise Gold pretty flat the US 10 year down a touch just about two ticks So we're going to jump straight into some of the news headlines and let's have a look what's going on on that front Starting off with some German data Let me just transition my screens We had German orders this morning To give you the data against market consensus German industrial orders came in at minus 0.4 percent as you can see here forecasts were for a positive 0.4 percent so pretty decent miss on expectations One thing then the decline driven by investment goods demand at home and overseas Defying the hope for a factory rebound all of this of course sounds quite pessimistic and quite downbeat and this is one of the things that I want to get Anyone who's new to markets You've got to put economic data into context when you read headlines like this on Bloomberg Obviously, it sounds pretty frightening and it is a decent miss on expectations It's a negative point for against expectations of a positive point for but the point being is in context Let me show you a couple of different things first of all look at the data in terms of Factory orders in itself on its month-over-month General change that we see yes, this was a miss on expectations But as you can see here from there the last 12 readings this data point does tend to fluctuate by a quite a Substantial degree as you can see here minus or negative point four is by nowhere near The worst prints that we've had over the last 12 months And so you know rather than getting drawn into a lot of the you know Just looking blindly at headlines if this is why you've got to do your due diligence And if you're preparing for economic data in the right way then these sorts of things shouldn't come as a particular shock and When I overlay this one as well which looks at factory orders, but on a year-over-year Perspective then you can see well actually this figure that we just had doesn't Shake up the general pattern that we've had which is that the German industry has taken a pretty sizable hit over the course of 2019 so with all this being said even though it was a miss on expectations the data in itself is absolutely No surprise at all So hence the reason why there's been no little to no reaction in the euro The bund is in effect lower not higher as the data would suggest from the logical points of view So again, my point here is always Do your prep work know your data sets and put everything into context The other thing of course is that from a macro perspective There's a lot of other big things going on and on that front. This of course is the biggest this is The ongoing US-China trade war. There's not really too much new for me to report at this point Obviously Trump made a pretty prompt exit from NATO without giving his what was a tentatively scheduled Press conference at the end of his discussions. That was after a bit of bad mouthing coming by the way of other Senior leaders, so he got a bit of a bee in his bonnet and just left town With that being said, I would suggest remaining particularly vigilant on Twitter For any further updates out of the US president As though he starts to head back home and as per his tweets over the last couple of hours He's been more tweeting about Ukraine and about the witch hunt and obviously it's back to business on Capitol Hill Which is trying to avert this kind of impeachment claim that's ongoing at the moment But nonetheless, I'd keep an eye out What we had yesterday, of course was a little bit of renewed optimism of otherwise What had been a fairly sizeable sell-off at the beginning of the week on the deterioration of the situation? And this came by way of a Bloomberg source report talking about Negotiators are getting closer on the amount of tariff relief and Trump's comments are not indicative of talks falling apart So this kind of idea of him trying to manage the situation coming back to fruition once again however, what I did think was quite interesting was the the Global Times editor the kind of mouthpiece of the Chinese government on Twitter who Xi Jinping Said I predict there is a high probability that President Trump or a senior US official Will openly say in a few hours that China US trade talks have made big progress in order to pump up US stock markets They've been doing this a lot Which is obviously the very much the common understanding in the marketplace of how Trump's been doing this now The reason why I point this out and I think it is quite interesting is I would say the more The collective opinion becomes that Trump is basically trying to game the system the lesser impact He's going to have in his ability to be able to influence markets But perhaps so directly as he has done in the past because now people will start to read between the lines And when he says that they're making kind of progression and it all sounds quite optimistic At what point then does the market start to go? Do you know what this is kind of the boy who cried wolf? Syndrome and we don't believe you anymore and then the market just continues to sell off So he's gonna have to be quite quite careful with this because at some point in time He's gonna have to deliver on something Now the good thing about the Trump strategy and the way this negotiation is going is that you've got the potential Temporary freeze and delaying of the December 15th tariffs. You've then got which could formulate more Comprise of phase one. You've then got the unwinding of the September tariffs The unwinding of the tariffs at the beginning of the year the unwinding of the tariffs last year. So that's a multi-phased Way of which you could gradually unwind what had been a escalating trade war of the last 1824 months which I think will likely happen in the medium long term in order for him to really manage the market So I think this is kind of very short term. It's a little blip But even if he gives a concession I think he's got many other things that he can basically do the same process Four times and that buys him enough time then to see him through the election is kind of the way I'm I see it at the moment Moving elsewhere not going to talk about this for too long But as I mentioned earlier the latest poll opinion poll for the UK general election, which it's kind of crept up Really, it's not far off now. We are This time next week the polling booths will be open So Johnson has a 10-point lead over Labour before the election according to latest comrades poll that's come out overnight And you'll remember this was after Was it you got one yesterday that was similar around a nine-point lead so after it was narrowing to about six seven in some polls it has now slightly Rewidened and also stabilised with a rough double digit lead for the Conservatives and hence one of the main supportive factors for the pound Now as you can see here the pound now on its highest level since May It's managed in the spot price to get above 130 which was the October peak and obviously technically then kind of the What had been restricting bit of the price action over the last several weeks and that opens this back up to an area Where we haven't been for a while. I'll let Sam go over that chart in more detail But one thing that that has been interesting is that pound dollar one week risk reversal So those people kind of looking now that we're in a weak proximity of the election to protect themselves Reflective of them potential downside surprises has been increasing so bearish bets basically have been picking up So even though we're moving higher Remember if the if people become of a view that a Tory majority is locked in that they already start buying the pound now in Pre-positioning for that to materialize That means then if Boris does not get a majority all the bigger and more violent the sell-off will be given the markets Positioning on the pre-inbuilt pre-positioning that's happened and so the higher we go The more kind of people are taking a little bit of protection for the what if the hung parliament It's probably the most realistic of those alternative scenarios to a Tory majority oil prices Yeah decent lift in yesterday's session and also a little bit of volatility this morning as we get underway for the meeting in Vienna Now Saudi's offering a carrot and a stick to get OPEC to defend oil prices. Oh really I'm going to jump to this one This came out of the FT last night and This was Saudi Arabia According to the FT is pushing OPEC and its allies to announce a deeper oil production cut as the group meets in Vienna In order to prop up prices ahead of a potential glut in supplies next year The move comes as analysts have warned that the crude market could be heavily over supplied in the first half of next year And as the strength of the global economy has been undermined by the ongoing US-China and kind of global trade war emanating out of the US and their protectionist policy so This is coming to as I Was kind of intonating toward at the beginning of the week I just found it very hard to see how Somehow Saudi don't try in some shape or form to try and lift the price of crude in order to then Given the pricing of their IPO of a Ramco is today And so when their shares do start trading in the coming days They're going to want the best possible price just to have that kind of positive PR around the initial trading of their shares Also following up from the FT article short one last night. We've had a short while ago OPEC plus I did discuss deeper oil output cuts of more than 400,000 pounds per day as the main scenario according to a source as well. So one thing to be aware of Just because of these comments would be quite bullish for price I would be super cautious about sitting in a position for more than longer necessary period of time Those of you who've never traded an OPEC Meeting before this is very typical now you start to get these really positive comments for price Then they can flip and all the different oil ministers will have very different opinions The Saudi oil minister arriving on doorstep comments this morning Didn't really give anything away other than talking about the weather But you can almost guarantee you're gonna get lots of whips or price action before something a little bit more definitive comes out So your kind of time frames of execution of trade need to be a little bit more Sharper, I would say given the propensity for the market to flip on itself Now this is the agenda for today all of these times are Vienna. So one hour ahead of London So at two o'clock you get the opening session today. So it's not at all bit later But believe me, you're gonna get lots of OPEC ministers talking to journalists. So tweets will be coming left right center I'm sure The actual then closed session happens later on this afternoon a press conference is expected to take place on Conclusion of that meeting so towards the end of the UK European session if there is no leaks beforehand Then we're gonna have a bit more something conclusive perhaps at the end of the day And then you've also got the opening and closed session of OPEC and non OPEC producing countries In tomorrow's Friday's meeting. So today is OPEC and then they throw in non OPEC So very important, of course, but it starts to include people like Russia. So that's the full agenda there I have tweeted this for the tentative schedule as well if you need it to add to your calendars Finally for the calendar on the session from an economic data point of view. What have we got? Let's just make this bit bigger so we can see Going through now the German data is out. You've got the Eurozone Q3 revised figures with retail sales coming out at 10. You've then got the Goods trade balance out of the US with the weekly jobless claims. We also Canadian trade balance data coming out at 130 The OPEC meeting as mentioned Start kicking off at 2 but just be vigilant for anything coming out beforehand as they go into that meeting US factory orders We'll be watched now quite closely just given the weakness of the data that we've had recently And then from a speaker's point of view Bank of Canada's Lane is speaking around midday and they've got a Fed speaker as well into the afternoon And quite a bit of supply coming into the market as well That might be just weighing a little bit on the bunds morning because despite the DAX as I'm delivering this seeing a bit of a downtick Buns are pretty unmoved maybe a bit of short setting just to take make way for some of the large amount of supply cumulatively top-end around nine billion euros coming from France and Spain Okay That is it gonna hand you over to Sam Perhaps he can talk about the DAX a little bit more as we test the some of the range low from yesterday and the pivot in the Futures at the moment, and then I'll catch you later on. Thanks very much guys Yeah, hi guys, definitely worth keeping an eye on the DAX here Sure is just coming down to test that low the day now and really cool it a zone yesterday afternoons low Coming in at 13 997 and then a tiny bit below that you've got the high that we had back on Tuesday as well So For a confirms real break of this this whole point You're gonna want it to go a bit lower down and of course keeping an eye because we're only 27 minutes into that Open on what were those previous lows? We could easily snap back it wouldn't be the most surprising thing in the world for that to happen So yeah levels to keep an eye on that area of here from yesterday afternoon The hive from Tuesday and also yes, they morning tire So a fair bit of support for it to get to really you have to say before it could get quite interesting to the downside As well just putting on this Potential trend line worth keeping a watch to see if we do get a third test of that of course at the moment Just with the two We don't see here There we go to keeping a watch what happens there and you can see that also lines up bang on with yes Afternoons low so some key levels there to keep a watch on of course This move started from that the failure really to get above the the high that we had from yesterday You can see that double top from this morning, but also yesterday's high and the failure to get there So well keeping a watch on obviously that goes lower So may us equities as well you could imagine in the morning the pound continue to push higher here It's been on a on a tear recently up trading now 131 50 the highest it's been in Well against the dollar anyway if we go back here, it's bang of horizontal lines. Yeah beginning in May of this year so a decent move I was looking at this yesterday the high that we've got from around 2014 Got on my Twitter But so this trend line here you can see we'll be looking to come in not too far away from we're trading Narrow that down around 132 that trend line or potential trend line I should say also matches up if it was today with the higher that we had on the third of May and if you remember That was really the top before we started pricing in a no deal Possibility so really key point. I would say to keep a watch on And that marking up just about 50 ticks above where we're trading if we were to find resistance there and drop down Obviously keep a watch on that previous range that we've been in you can see Any of those previous highs would be worth keeping a watch on and then of course If we put this on this longer term, you can see really that that trend that broke through as well around 130 Really key levels above that trend line the longer term one I don't see much stopping it towards 130 320 so another big push could come of course It just takes one big headline and we come all the way back down euro pound Before we come on to the euro you can see euro pound here the lowest. It's been since it's been a little line on there Yeah, May 2017 Had a couple of attempts previously trying to break this area. We had in January February March and April 2019 couldn't do it pushed all the way up to that multi-year high that we had on August 2017 one day above it and then came all the way back down Is this an amazing place to buy or is this actually the start now of a complete change of this overall direction? We continue to push lower time will Will tell and of course the election would have something to do with that having a look over at the euro yesterday Did reach some interesting levels? It could still get dragged higher by the euro by the pound of course if it is of positive Brexit news But what a key level it is you can see here You've got the high the low couple lows few highs and more highs again before having a little false break yesterday So keeping a watch on this one eleven oh nine pretty important point Has to be said if that is to hold not much really could stop it You would say until well, I guess round one ten forty four about one ten would be the target down to Those lower points above it then yeah Sure, we can we can spread our wings and get a person maybe longer term Looking for that 112 so quite well set the euro depending on on your bias and wait to perhaps see what's happened If you think get in that short yesterday another test of that level which comes in just before the The R1 so be aware of that and of course yesterday's high as well And then you can see on the shorter timeframe yesterday's low is Tuesday's low as well really key point if that is to go To the downside you'll you'd be pretty comfortable in in holding this short I would say almost down to the highs that we had back on the 25th that comes in around today's s2 whereas Yeah, that high Obviously above the R1 also work keeping in high and I I should say on the the double top We had from the second and the third just a bit above where we're trading But thought of a bit weaker the pound pushing things as well So keep a watch on the euro of course gold. Yes, they we were talking on the the brief and just have how Significant 1490 was and you can see here just how well respected that support was before we broke through First real tests and it comes all the way down. However, of course nothing to do really with that with the technical side of things we had the positive trade comments and But then we had a bit of weaker US data which just gave people another chance to get into that trade And we came back lower couldn't break through the pivot not too surprisingly though It was the previous high of of Tuesday as well So there just shows the importance of that patience and this was around. Yeah, 320 Saying where that was to go then we could see a further move lower So that's still something I'd have marked up 14 76.7 to the upside now You're obviously keeping a watch on that 1490 longer term. It is just absolutely massive More intraday a couple of decent points just above where we're trading As well the higher the day coming in around as well as yesterday's resistance It's called it 1487 just under 85 40 84.7 as well No real trend lines in the mix of where we're trading now relatively choppy. It's up a dollar at the moment So not too much going on for gold. However, if we just Scoot it back a bit. Can we get anything from those lows? Let's have a quick look You can see we almost got a third test of that So from the low the second to the third just have a look to see what happens there on the test of this load Do we get an area support if we do obviously could be a good opportunity on that shore and break as well We're 1476 point seven oil Been on a bit of a tear as well as it's the pound or is it oil big push over the last 24 hours and Let's put this on that 240 you can see If we were looking at this trend channel that we had on yesterday Again, I'll just roughly draw this on You still see we got a fair bit of fair fair way to go before we would get the top end of that but the highs of yesterday and Also the highs that we had on the 27th and 22nd are very very important Also, pretty much the higher the 20th so 58 73 is going to be big Keep a watch on that as if that is to go and close above Well, $60 could well be the target that people look at. However, of course, it's not guaranteed that that is going to be Work the direction for the day. So keep a watch on some support levels below 5750 I quite like the look of you had all these lows around here from 27th broke through it like it was nothing yesterday However, keeping a watch on that as well And then also around the S1 looks like a pretty good point I'd have to say quick look over equities in the US to think finish things up R1 important. You've got that retracement point that we had Late trade on the second. Also, you'd say yesterday's highs worth keeping an eye on as it's almost today's high as well And actually when you start drawing up these Previous highs and lows you just see how technical these markets are actually at the moment R1 yesterday nice Area to to have got short it seems but also you can see the low of today is the high of yesterday morning 3100 well respected as well 3095 of a keeping a watch on that. So, you know while This market, you know as I did recover a fair bit yesterday still acting pretty technical for either the longs or the short I think we were to get above The the high obvious they just be aware that a couple of points above that you do at the high of Tuesday as well So might make that a bit trickier and maybe focus on the R1 is slightly better there as well if we were to get a bigger move down in European equities then Then sure favoring the break of that level is Isn't a bad idea, but you can already see from the Dax there hits the pivot hits yesterday's low Almost hitting that trend nine and we bounced a fair bit already So just shows how you know the patience and weight in is key We actually can see a pretty much hit that trend line didn't it? So let's you know still have that on and a break of that I'll be targeting to the downside and I'm on about here the previous high that we had Around quarter past five UK Tom any questions as usual, please do let us know euro pushing higher the dollar week Probably dragged high as well by the pound you got some key levels above where we're training for the euro It'd be interesting to see what Alex says when he comes on Oil could be a busy date got some very important resistance Let's just call it yesterday's high and a bit above that could really if that's a break leader a push towards $60 equities Who knows but positive sentiment sentiment ruling at the moment gold 1490 very key to the upside 1476.7 to the downside Containing that range should be a good date. I hope you'll Have a good trading session. Let me know if you have any questions