 Welcome traders to Ticknell Weekly Market Outlook for week commencing the 19th of July with me, Patrick Mumley. We could expect further market turbulence this week in the form of the oddity of the US debt ceiling. That is likely to keep taper talk at bay at least until Jackson Hole if not later. A month-end flood of liquidity before the US debt ceiling gets reinstated on August the 1st. It is likely to drive a final push lower in Treasury's general accounts at the Federal Reserve down to about 450 billion or about 200 billion from present levels. The latest debt auctions before the ceiling is imposed will arrive before relative debt scarcity is engaged with issuance drying up. Treasury Secretary Yellen has indicated she will send a letter to Congress invoking extraordinary measures on how long they could last. The past debt ceiling tricks could be re-engaged by Templar backing into retirement funds of government workers and the Treasury exchange stabilization funds. I think that Congress may not begin to get serious until after the recess when they come back in September and must address the September 6th expiration of pandemic unemployment assistance programs. The expiration of the American Rescue Plans extended benefits to September 30th expiration of student loan deferrals at 0% on September 30th. And the expiration of COVID-19 simply benefits a new agreement to fund the US government beyond the September 30th fiscal year end. So in terms of the domestic data calendar this week, it's very, very light in terms of US data. Nothing really of note, so it's going to take its drivers from elsewhere. From a technical perspective, the dollar index has continued to hold above 92 as it does so. We look for prices to extend to the upside to test the equality objective at 93, 73 and potentially the year pivot there at 94, 15. To complete the WXY corrected pattern on the higher degree and from there we'll see how price action plays out. If sellers do re-emerge at these levels then we could have completed a major wave 4 high here and then we would be looking at a minimum retest of the prior lows and potentially extend down further to 8750. But in the near term, whilst we hold 92, we look for a test of 93, 73. In the Eurozone this week we're going to be paying very close attention to the July ECB meeting, which is on Thursday. It's really the main event of the week. What was supposed to be a non-event has turned into a key focus point of the week following the release of the ECB strategic review. With ECB shifting the inflation target from below but close to 2% with a commitment to symmetry, the new strategy can be interpreted as either a formalization of what has been doing over the past few years, or a step towards more dovishness as 2% implies a more resolute effort. This means the distribution of probabilities is skewed to a lower Euro dollar this week. No change in the ECB bias is unlikely to be enough to send the Euro higher. At the same time any ECB shift towards the dovish interpretation of the strategic review would underscore the recent corrective move that we're seeing in the Euro. While not a discussion from next week, the ECB dovish bias would suggest that the total reduction of monthly purchases in 2022 will be less than previously expected beyond the ECB meeting. The focus will be on the July PMI manufacturing and services readings due on Friday. The Euro dollar continues to hold below 119. We look for prices to extend to the downside, initially retesting lows at 117.03 and then on route to the major equality objective at 116.22. And similarly with the dollar index we'll see then if buyers re-emerge at this area and we could have completed a major wave 4 low and then we would look for the next extension to the upside. In terms of the dollar yen, we have what has really been a reflattening of the US yield curve has once again provided some support to the yen, which has been the only currency alongside the Kiwi dollar able to outperform the dollar last week. Interestingly, the 60 day correlation between dollar yen and the US 10 year yield is that it's higher since June 2020. The Bank of Japan meeting was on Friday as usual largely ignored by the currency markets. Policymakers adjusted their growth forecasts, revising the 2021 fiscal year numbers lower and the 2022 fiscal year higher. However, most of the focus was on the announcement of a green lending plan, the allocation of some of the foreign holidays to foreign currency denominated green bonds. And the week ahead, the Japanese counter includes June CPI report, which is expected to show the headline year over year figure having moved into mildly positive territory plus 0.2% from minus 0.1%. That's unlikely to change much for the yen given the immovable BOG policy stance and US Treasury dynamics should remain the main driver for the yen. Some slight improvement in risk sentiment could prompt some yen weakness more likely in the crosses. So from a technical perspective, whilst we hold this 110.72 retest of the trend line support from below now acting as resistance, look for prices to extend through the 109.50 targeting the equality objective at 108.58. At this stage, really we would need to close back through 110.70 to refocus on the 112 upside objective. In terms of sterling, we've seen a shift in the communication from some of the BOE officials with the MPC member Saunders and Deputy Governor Ramson, both indicating that the need to take our asset purchases may come earlier than expected. However, the impact on sterling was limited partly because the next step in the eventual policy normalization process, i.e. rate hikes, remains still some way off. Despite the increase in COVID-19 cases, the UK government will deliver the final part of reopening and end restrictions on July 19th. On the domestic data front, the focus will be on June retail sales and July PMI manufacturing, both on Friday. So from a technical perspective, whilst sterling remains contained on the upside of 139, we look for an extension to the downside to test the equality objective at 136.65. At this stage, really we need to close through 139 to refocus attentions on the 140.80 resistance. Lastly, down under in Australia, the Aussie dollar really failed to break above 75 last week when global sentiment appeared favourable, but it's now back trading just below the 74 handle. It still appears to be mostly about external factors and the down markets have built up a risk premium on the Aussie to account for yet another five-day lockdown in the state of Victoria. While a chopping risk sentiment and the unwinding of reflation trades have been the main driver of the Aussie lately, other external factors, although should be considered rather positively, China's second quarter numbers point to a steady recovery. And iron ore has risen back to the early July highs last week, also bucking a not so good trend in other commodities. Internally, another solid jobs report saw unemployment move back below 5%. Next week will be quiet in terms of Australian data with some attention on the RBA minutes from the July meeting where the central bank remain very dovish and developments on Victoria's contagion situation should also be monitored. The Aussie, if we can see a turn of resistance, we could get a bit of bounce here. But from a technical perspective, we have now taken out the equality objective at 74-17. And unless we get a quick turnaround here as we open things up in Asia this week, I think we look for a downside extension, certainly whilst we trade below the 75 handle to get us a test of the monthly range support at 73. And then we have the 161 extension of this AB swing structure, which would give us a test of 72-70. There we'll see if buyers re-engage on the long side to complete a potential major wave 4 low. So this is going to be a key battleground as we head into the beginning of the week. And that concludes the weekly market outlook for week commencing the 19th of July as oil traders, trade the plan, most importantly, manage at risk. Until next week, thanks very much.