 Good afternoon and welcome to the Monday market update with me David Madden Today's date is Monday the 3rd of February 2020 and the time is just gone 1209 GMT and It's we've seen a bit of a rebound in European stock markets, but It is worth noting overnight We had major declines in mainland China stock markets in mainland China It was their first days trading since after the lunar New Year celebrations, so why we saw heavy selling in Europe and European and US markets and some Asian markets last week mainland China the epicenter of the coronavirus crisis Was remained closed. So there was enormous selling of pressure On mainland Chinese stocks overnight some of the some of the markets such as the Shanghai composite in the likes Up and roughly 8% lower The people's Bank of China the Chinese Centre Bank were fairly quick to try and stabilize the situation and they quickly announced a An equity injection as a way of kind of calming the markets down. It did a small bit Stocks in mainland China broadly speaking were only down about 7% rather than they kind of over 8 So though there was a bit of stability brought but nonetheless It was essentially all the kind of panic and fear of frustration that was built into the into the into the stocks While the market was closed so with that Because Chinese stocks even intervention from the people from the Chinese Central Bank Stocks were off the lows the session down heaviest heavy heavily nonetheless We have seen a bit of a rebound here in Europe Keep in mind we had a pretty negative finish to the European and the US trading session on Friday just gone So we're seeing a small bit of a rebound in European European stocks You know, it is worth noting that you know that the games you've made today are very small in comparison to the losses We backed off at the back end of last week. It could be a better profit take So it could be a bit of bargain hunting could be better short covering, but nonetheless If the size of the gains are relatively small take a person the losses incurred which suggests that there isn't a huge amount of bearer sentiment So what I'm gonna do now is I also just want one to kind of map out what the time for the video is I'll talk about a couple more topics of interest in the last day or so Then I look at the week ahead article and then I take a look at the major charts Also in the news today a lot of volatility in the British pound UK Prime Minister Boris Johnson Basically said said to to the European Union If you're going to you know, it's a it's essentially said you would consider walking away some discussions and trade talks if the European Union insists that the UK Stays in line and effectively follows EU rules after the transition period ends So traders on the back of that are fearful that opens up the possibility of a no-deal Brexit scenario after the transition period ends And with that we've seen a fairly size of sell-off in the British pound It's down nine tenths more percent against the US dollar Euro sterling is up near, you know over six tenths of what percent So we've seen a big move to the downside in the British pound on the back of that There has been some stability returned to the oil market oil to get massive ticket battering heavily recently Given that China is an arduous importer of the energy in the world OPEC plus have come out and said they would consider just consider Cutting production by a further eight five hundred thousand dollars per day as a way Well, you know, if this is a measure of just stabilizing the price and you know The the change in the day both WTI and Brent are particularly big in comparison to what's been recently So that's brought about some stability Let's take a look at the week ahead article Now the week ahead article can be found on our website CMTmarkers.com Under insights you'll find the news and awesome section like a scroll down here. You can see that Tonight Monday, we have alphabet. They're the parent company of Google. They will have four to four figures out tonight We've already had some of these figures in relation to In relation to China in relation. We're gonna have the services figures coming out on Wednesday We also have the final reading of many service reports coming from the UK Major Eurozone economies and the US. They'll be published on Wednesday because we've already had the the manufacturing ones released This morning the Reserve Bank of Australia. They will have a their interest rate decision Tomorrow and the early hours of tomorrow the anticipation is that no change you made to the industry cut to the interest rates rather On Tuesday, we have a fourth quarter figures out from For the fourth quarter figures from BP on Wednesday We have first half numbers from part of elements on Thursday. We have fourth quarter numbers from both Twitter and Uber And looking towards the back end of the week the all important US non-front panel support That's likely to be the most important economic update of the entire week And we also have an update from the jobs update from Canada So what I'm not going to do is take a quick look at some of the major Indices to begin with I'll go to the indices. I'll go to a couple of currency pairs and then finish it off with some quantities So last week on Friday major day of selling on the footsie fell to a seven week low We've seen a bit of a bounce back today The sentiment is clearly it's clearly bearish where you know While we hold below the red line here the Trinity movie average at 7364 it's likely we could see further losses I should that be the case we could look at targeting 7200 or basically this area here 7132 we'd really need to be getting back above the fifth movie average is blue line here in a 7466 or even up as far as the 7500 zone before if you then begin to begin to think that the recent hour trend has come to an end but Like I said for the time being that the sentiment continues to look fairly negative On Friday the tax fell to its lowest level in a month or so or maybe by three three and a half weeks So it's not as bad as the the footsie 100 Notice how it found decent of support from this is old here in around 12900 that area is active previously is consolidation and a bit of support if we continue to hold above that in the near term We could see the market potentially have a bit regain Some of the ground that was continued to regain some of the ground that was lost on a Friday But you know the trend for the last few weeks has clearly been it's very been negative So if you do have a size of break below 12900 it could take us back to this zone here down around 12600 and 60 If we do look to kind of rebound from from the from Friday's low We could look at it back towards 13200 or perhaps his blue line here 30. They fit the 50 moving average in a 13 274 now the US markets are in better shape than their European counterparts But the US markets for further portion of last week were fairly slow to actually feel the feel the pain Of the coronavirus crisis except for on Friday We had a major day of selling and you can see here at the Dow Jones Actually closed well below its 50 moving average and it hasn't done that for quite some time So you give me the indication of how bearish it is now it would it would appear that we're going to have a rebound Today but keep my not keep mine that the trend for the last couple weeks has been fairly bearish So if if the mark I think a more recent bearish trend those take those take hold Take hold we could be looking at retesting this area here at around 28,000. It's a big psychological number But if you do have a bit of rebound in the near term and we get back above the 50 moving average We could look head up towards 28,800 or potentially 20,000 930 It's a fairly similar position picture rather when we look at the s and p 500 Major sell-off of Friday. In fact, it pretty much almost bounced off its 50 moving average Just blue line along here. So even though the sentiment in the near term Has is is negative that there's no doubt about that if we could just have a hold above Friday's low We could hold above the 50 moving average. We could look heading back up towards 3,250 and if you go beyond that we could potentially look at targeting this zone 3,300 But if you know the market might look to kind of rally towards those areas before potentially turning lower again Should that be the case? If you take out Friday's low, it could take us back down towards 3,200 or down towards 3,180 I talked about how There's a major move to the downside in the British pound this morning So we can see here that broadly speaking since since christmas eve onwards, you know Broadly speaking move higher in the in the British pound versus the US dollar And then of course today we had a fairly sizable sell-off now We're pretty much on this blue line here at the 50 moving average So you can see that probably hold above this trend line here the lows in late december to the lows of of mid to Mid mid mid mid to late january if you could hold above that it's likely we continue to depress on higher from here but Keep in mind we had a fairly different decent slack. We're pretty much trading on the 50 moving average So this could be kind of a Very an important level to keep my eye on so if you could hold above the 50 moving average We could look at retesting the 132 zone and if you go beyond that We could be looking at testing the late december high in at one spot 3284 If for the downside we could need to move lower from here Support could be found from this area from this trend line here, which comes into play in around one spot 30 It's a big psychological number Excuse me so I could Make it it's likely to make it even more important because you got a couple of keep keep prices case key Price points coming together converging a psychological number and a trend line That could it's likely to make that that point More important shouldn't be to be tested So we could see support coming to play in around the 130 zone But if you gave a break below that we could be looking heavy back down towards the one spot 29 area I take a look at euro dollar now To be honest euro dollar has been fairly boring the last um The last few months Starting from late december going forward We can see here that's been in a downward trend lower low lower high lower low And what could be a lower high I think all things pan out so What so we've seen the lower low and lower high and we've seen a found decent support in this area here You know coincides with the big number of you know 110 But we're still below the 50 moving average the blue line and the red line He truly moving average so it seems to me that that the that the market is still in that kind of various trend We really need to get back above those moving averages the 50 and the 200 before we could begin to think The market's shaking off the recent negative trend. So if we do push on higher from here We could be looking at targeting one spot 1172 And a movie on that could take us up to the highs that we saw in late december But if the market remains in the kind of downward trend It could be a case of better presses on higher only to turn lower yet again And if you do have a fairly decent break below 110 that could bring 109 I into play or even sell to that down towards one spot 08 79 I take a look at what's going on on the gold market. So I talked about how A lot of money in the last few sessions in europe and the us Uh and indeed china overnight money's been flying out of stocks And it's been going into you know assets that are deemed to be safe haven safe heavens such as gold So you can see here At the gold and the overnight session hit its highest level since early january This here was on the back of the heightened us around tension. So giving an indication of how How negative sentiment is and how how much traders are in risk off mode if they're kind of driving the Driving up the gold market to levels Last seen around the time that it looked like You know the us and the iranian regime were potentially on the cost of war So the market's been pressing higher For that for the last month or so. It's in a fairly solid upward trend If you continue to press on higher from here We could be looking at targeting the psychology important 1600 daughters And if you go beyond that we could be looking at targeting the highs of january in around 1611 Finally the dip has been popular strategy with traders in the last few weeks and even deed The last few months. So if we do see any moves to the downside support We found this zone here down around 1562 And even if you go below that support could be found from this area here down around 1536 So it's a 1562 and 1536 potential areas of support for the gold market now I mentioned how How oil I said a pretty bad run of it recently You can see here and in early january This is how this is when the oil market spiked on the back of the us around tensions Then there was the de-escalation of tensions. So we saw the subsequent Moving the lower low the lower high and an aggressive lower low So we've been moving sharply lower on the oil market in the last in the last few sessions We could see a bit of stability coming into play here. We can see So not that major surprise. We see a bit of a turn around a bit of a bounce We saw some wires coming to the fold down on this level here in around 56 spot 71 You know, you can see that a coincides with a couple of areas of support going back some time If you can hold above If you can hold above the session lows, we could look at snapping back Intendance and ground we could look at heading back towards up towards 59 spot 60 or the important Psychological 60 bucks a barrel level, but you know, make no mistake the sentiment is clearly to the downside So if you take out the if you take out the lows The lows all today it was going to pave the way potentially for like the 54 to be tested That is on Brent oil. I'll take a look at WTI Similar scenario here. You've had the lower low the lower high and another lower low granted, you know this so far this this candle is showing A positive is showing a positive sign. So we are seeing you have seen a bit of a turn around once again the That metric Proof significant in the past you can see here in around 50 spot 36 You can hold above that level We might stand the chance of heading back up towards where this gap was created on the 23rd of january in around 54 dollars a barrel, maybe just north of it in there they're about But if you do we could so potentially bounce back up towards there, but keep in mind Sentiment for the last few weeks, I think quite negative So we could be looking head back towards the recent lows followed by potentially 50 dollars a barrel And if you break a lot 50 a good point the way down towards 49 48 so on and so forth Now, uh, I do also want to quick mention in relation to the non-farm payroll support We'll be holding a webinar for that event Um on friday, you can sign up for it on our website You can see here non-farm payroll friday the 7th 2020 and the time is 15 So apologies apologies. The time is 13 15 gmt So be quarter past one uk time the numbers come out at 13 30 gmt So please feel free to sign up for that And that is the end of this video. Uh, so thank you for listening. Have a good trading week and good luck