 Good afternoon, welcome to CMC Markets on Friday the 1st of June and the May non-farm payrolls webinar where I will be covering the numbers live as they break but before we get to that the general risk warning So nothing that you see or hear here should be construed as direct investment or trading advice And then usually in my case generally tends to be a reverse indicator but joking aside Just have to get the get the reverse the risk warnings out of the way before I before I get started on the interesting stuff as to what markets are going to be doing in the wake of these numbers and I think Given what's happened thus far this week. I think it would be I don't think it would surprise you to know that The these payrolls numbers are probably not going to be big drivers One way or the other of where equity markets are going to go what they could be is significant drivers of Where the US dollar might go now at the moment? We're getting a little bit of a bid coming into the US dollar heading up to the numbers on an expectation I would suspect that we're probably going to get a decent set of numbers, but for me I think it's less about the headline number As it always has been over the course of the past few months It's less about the headline payrolls number and more about the wage growth, which to be honest with you has been I think particularly disappointing If you look at where the wage growth numbers were for example at the beginning of this year They're at 2.9 percent and since then we've really struggled to match that we came in at a 2.6 percent last month and we really plateaued it around their sort of area and Given from where we've come since April the US dollar has been on a very significant climb from the lows that we saw At the beginning of the year It also corresponds with the decline that we've seen in euro dollars So I think for me There is a danger that even though we're seeing a little bit of a bid tone in the dollar at the moment We could well have seen a short-term peak if this dollar index chart is any indication those of you who will have followed my fairly regular updates when it comes to Looking at candlestick patterns and looking at potential indicators of a trend reversal will know that I like key day reversals that I like bullish and bearish engulfing patterns on daily or weekly charts and earlier this week We got a bearish daily reversal on the dollar index and With the dollar index 50 58 percent of the dollar index is made up of Eurodollar So I think with respect to Eurodollar There is a danger that we could have seen a short-term base at 115 and I'll talk a little bit more about that in the context of the wider numbers because We looked at the wider numbers. He looked at the ADP numbers earlier this week They came in slightly softer at 160 164,000 and we did see a significant downward revision to the previous month's number as well Now that's not necessarily a bad thing that payrolls numbers are coming in at a fairly low level It just suggests to me that the labor market is starting to get a little bit tighter and Those new jobs becoming harder and harder to fill So a low payrolls number doesn't necessarily indicate that the jobs market is slowing down You've only got to look at the weekly jobless claims numbers to realize that they're still polling in the 220s Which is pretty much near 40 to 45 year lows. So Look looking looking at the weekly jobless numbers looking at the overall economic indicators We saw personal spending for April jump by 0.6 percent even though personal incomes jump by 0.3 again, that does appear to suggest that While the US economy is in that full employment Certainly the jobs market is fairly healthy and people will feel more confident about spending money So the unemployment rate is expected to remain constant at three point nine percent Unchanged from the April numbers the non-farm payrolls number is expected to come in slightly higher from last month's 164 to 188,000 but again, not really that concerned about the headline payrolls number What I'm interested in in the overall context of what we go to next is the wages numbers and those wages numbers Here we're expecting a slide-up with revision to 2.7 percent Also in the context of the wider picture for the US dollar this payrolls number Isn't likely to make any difference whatsoever to whether or not the Fed raises rates this month The Fed is going to go in June barring a significant meltdown in global equity markets So pretty much a June rate rises are done deal. What is it's more unknown is Whether or not we get a September and a December rate rise So do we get four rate rises this year or do we get two or do we get three? And I think that for me is how the market could well react in the context of Expectations about a September rate rise and a December rate rise So for me, I think if the numbers come in broadly as expected Broadly as expected around about these wages numbers 2.7 2.8 or even if we come in at 2.6 I think that's going to be slightly dollar negative if we look at If we look at the US 10-year yield here, we can see once again We're getting a nice little rebound in yields on the 10-year. It's around about just below 2.9 percent 33.6 basis points up on the day We've had a significant drop over the course of the past week on an awful lot of safe haven buying given what's been going on in Europe and in Italy in particular So I think in the overall context of things we've had a good week for the dollar Mike my questioning now is How much more upside is there? given that we've seen a little bit of a rebound in the euro and slightly softer US yields what is going to be the catalyst to drive them Significantly higher. So let me just get rid of that manufacturing payrolls number there and these these are the key numbers that I'm Keeping an eye out for these three numbers on my right hand side here So we've got seven and a half minutes to go I've gone through what I'm expecting also inflationary pressures do appear to be showing signs of edging higher so that should be a net positive in terms of Rate rise expectations, but what was also interesting this week and This is likely to feed into the overall direction of the euro was the big jump that we saw in eurozone inflation From 1.2 percent to 1.9 Which suggests to me that the recent increases in commodity prices are now starting to feel Filtered down into the headline inflation numbers and if that does become apparent Then that is likely to raise expectations of what the ECB European Central Bank might be looking to do further down the line Now the political situation has Moderated somewhat in Italy. We'll start by looking at the FTSE MIB We've seen a nice little rebound off these lows here The market on the FTSE MIB is looking what I would call it It's a little bit oversold in the short term pretty much like every other equity market So that would suggest to me that there's probably going to be limited further downside in the FTSE MIB for this week Given the rebound we've seen over the course of the past three days. What has also been fairly interesting I think has also been The resilience of the FTSE 100 we can see that borne out in this particular chart here on a daily chart FTSE index FTSE index has probably been the one index this week is likely to finish the week in positive territory The DAX still looks a little bit soggy As does the CAC Courant But here again We do appear to be seeing some evidence that we could potentially be looking for a bit of a rebound I'll quickly look at the Germany 30 for you Where we have the 50-day moving average Which is helping support the current price action if we look at this particular area through here on the German DAX And if we look at a short-term chart, let's drill down into the four hours We can see that there's a decent area of support Round about 12,550 we do appear to be starting to wedge back towards the 12,800 level I don't really expect us to move too significantly out of that given the volatility that we've seen this week and Given the fact that we are also lower on the week so Again today's payrolls numbers probably aren't going to affect the DAX too much What it will do I think is if we do get a weak dollar number and it pushes the euro up It will limit the upside in the DAX Similarly in the CAC Courant, so let's look at the let's look at euro dollar because we talked about the dollar index let's just hide all the key indicators here and look at the euro dollar and Look at what I think is a potentially a potential indicator of a short-term base We can see that here look at the way that this candle has rebounded quite strongly engulfing the Previous days candle, but also half of the day before that is a potentially bullish sign So we are seeing a little bit of a drift lower At the moment we could see a drift back down to around about 116 on a fairly decent dollar number But I would be surprised if we dropped below the low here of this day here And I'll quickly tell you what that low is that low there is 116.0510 so that was the low on Monday The low this week has been around 115 101 1520 for my for my euro rebound hypothesis To play out we need to see a move back above 117.30 which is these series of peaks all the way through here and we can draw a line Through these series of peaks just by doing that with this particular chart here And this is this is essentially how I I construct how I construct a bit of a trade set up on On any given chart got a nice little base here. We've got a series of peaks through here Let's just get rid of that and redraw that There we go So we can see we've got a lot a series of resistance levels all the way through here and through here This is round about 117.30 there are thereabouts I'll usually post an update on the chart forums To that effect and they can be they can be found there as you can see on the left hand side rebounded from the 15 level Need to break up potential for rebound towards 117.30 if we take out 17.30 We could see a move back to 117.70 118.30 On the basis of this chart, I think it's more likely we could probably drift back down To the low 116s on a fairly decent dollar number in the short to medium term, but it doesn't change my view Given how this chart looks at the moment And obviously I could quite conceivably be wrong But looking at the dollar index and the bearish tendencies That are being displayed there then on the balance of probabilities I think it's more likely that will short squeeze higher in euro dollar towards 117.70 118.30 Over the course of the next few trading sessions and how we get there is a different ballgame entirely But looking at this 116.10 area I would expect that to hold on any dip down and then let's rebound back towards 117.30 So that's your dollar. Let's have a quick look at doll again as we count down to the numbers Again decent support all the way down here at the 50 day moving average So that's quite a key area there 50 day moving average is at 108.50. So that's looking as if we're starting to get a little bit of positivity there So if we do get a dip Back down I'll be very surprised if we move much below 108.50 If there is any if there is any market that you would like me to cover ladies and gentlemen feel free To ask me a question and I will endeavor to answer it to the best of my ability Um cable similar sort of story Found a little bit of support around about 132 Not as conclusive in terms of where we go to next We're in a bit of a range between 133 and a half and 132 If we do get a strong dollar number and a strong dollar number is a wages number above 2.7 Then we could we'll get a move back towards these lows a weak dollar number should take us through 133.60 Back towards 134. So for me, it's really it's a fairly binary outcome Um a fairly decent number should push the dollar higher. So that's 2.8 a An expectations number 2.7 or even 2.6 is probably likely to see the dollar Remain below its recent highs and maybe test lower over the course of the rest of the day 223 decent headline number 2.7 pretty much as expected. So no surprises there. The unemployment rate has dropped again To 3.8 percent. So net net that's a fairly positive number Um So all in all we should see a test higher in the dollar a test towards 116 10 in euro dollar But again, while they're decent numbers, I don't think they're going to be significantly significant in terms Of pushing the dollar to new highs and through 95 and what is significant about the headline number ladies and gentlemen is that the Previous months number has been revised down from 188 to 159. So download revision to the april number of around about 19 Around about 30 000 29 000 But uh the headline number has come in around about 30 000 higher. So a little bit of a swings and roundabout number there um slightly dollar positive But not overly so so I think the likelihood is we're going to see more range trading between 116 10 on the downside euro dollar 117 30 on the top side And similarly on the pound Decent support around about 132 and will continue to trade the range that we have been for the past few days looking at bond yields Not surprisingly they've aged higher. So that should be fairly dollar supportive Um, the 10 year is now gone from to 89 60 to 291 30 We can see that here So slightly modest uptick in the 10 year What does it tell us about the expectations for a rate rise in september or december? absolutely nothing It doesn't tell us anything um Simply because it's a neutral number It's not particularly strong It's not particularly weak So been asked about the Dow This really I think tells us all we need to know about the Dow decent support If we just let's drill it down into a slightly Shorter term chart I think we're probably going to drift towards the upside to around about 24,700 Um, but overall I don't think it's going to drive the Dow significantly one way or the other next week We've got the g7. Obviously we've got concerns about tariffs um, the recent implementation by president trump of aluminium and steel tariffs on the european union canada and mexico The prospect that um, we will see countermeasures implemented by the EU Sometime over the course of the next two or three weeks By the 20th of june They could get walked back between now And next week's g7 meeting so again You know sometimes The narrative or the narrative out of the media tends to drown out what the price action is doing And at the moment what we're seeing Is Markets are undecided as to what's going to happen next is president trump Going to really shake up the world order and potentially damage um, the very people who voted for him in 2016 His behavior is becoming increasingly unpredictable and at the moment all I can say about the Dow the us 30 Is that we're going to continue to trade in the range that we've been in Pretty much the past month decent support 24 to 50 decent resistance around about 25 000 um, the us small caps has continued to outperform Simply because an awful lot of the stocks in that index are domestically focused domestically based And the us economy is actually doing okay But again in this case you have to wonder how overextended that is more importantly When I look at say for example the S&P 500 I get a fairly similar Story in terms of what the outlook is For this particular index. It's a range trade at the moment And ultimately it's going to be very very difficult. I think to really determine where we go to next In fact, if we look at this we can probably see that Given where we've been and given over the course We're probably nearer to the top of the range Then we are to the bottom of the range On a four hour chart So on that basis I would certainly be looking to maybe sell rallies back towards this series of highs through here And look for a move back towards Lows around here That we saw earlier this week around about 2700 It's really not particularly anything to get excited about Unlike european markets, which look as if they're going to close down For the second week in succession or should I actually I should revise that? The german DAX Is likely to close lower for the second week in succession And this you typically find This when you have a very strong up move In the case that we've seen with respect to the german DAX and we look at the last eight weeks We've seen one two three four five six seven eight successive weekly closes higher When that when that run gets broken you generally tend to see A sharp reaction lower over the course of the next two or three weeks So I think for me with respect to the DAX you're probably likely going to see now A lot of choppiness, but albeit back towards Around about 12,500 12,400 And I base that On the fact that the euro is likely to drift higher Because it's no coincidence that while we've come down from 13600 to 11700 That's also coincided With um, and then rebounded again this move from the lows here As coincided with the euro dollar coming down from 125 to 115 so if we look at This here we look at this chart here on the germany 30 You've got all these series of lows here 11,700 We now look at euro dollar And look at it over the Same period look at what look at where the peaks are in euro dollar relative to the lows in the DAX You've got 125 125 and then you've got the highs Highs here in the euro the lows in the DAX Euro dollar comes down German DAX goes up So if we're getting a reversal on euro dollar That could potentially act as a headwind for the DAX the proxy doesn't always work But as a general rule If the euro dollar is going up then The the upside on the DAX for that particular day is likely to be fairly limited if that makes sense Um being asked about gold Always a favorite. So let's have a quick look at it. Let's just get rid of these first so that clears up some more space And look at the old goldy price And it is struggling to get back above the 200 day moving average more importantly though John it's The 50 day moving average is starting to roll over as well. So That suggests to me that You know, unless we get back above say 1310 or 1320 Momentum is likely to favor a slightly weaker gold price in the short to medium term However, I wouldn't be overly concerned about it if we zoom all the way out in the way that I have been We're still in a fairly decent uptrend from the lows that we saw in the middle of last year So if I draw myself a little trend line there Through here We're still in a fairly decent long-term uptrend even though we're starting to track lower a little bit So I think the likelihood is that while we're below these two moving averages here The momentum will take us back towards this trend line around about 1280 We're still in a very long-term steady uptrend, but we're going in for a bit of a consolidation I think in a similar manner to the way that we did Back here in september we tracked lower we tracked lower we traded sideways We hit a trend line We rebounded and I think what's happening here is similar to what's happening here. So Overall, I think I'm broadly positive in terms of risk Which is likely to push the gold price lower Um Simply on the basis that the dollar is can probably going to be a little bit stronger over the course of time Um upside in euro dollar again, it's going to be limited to I think around about 118 119 That's probably going to take a few days or a few weeks to play out But overall I think risk political risk in europe will come back The italian government that's just been cobbled together By five star and the league May not cause tensions immediately within the european union, but I can't help thinking at some point that it will And it could well it could well pose significant problems for The european central bank when it comes to looking dial back its stimulus measure Euro dollars seems to be bouncing on the numbers. Yeah, again You know, it goes back to what I was saying about that those numbers being sort of Broadly positive but not massively positive. So the markets tried to push the dollar higher Euro dollar, I think only went down to around about one 16 and a half Didn't even get anywhere close If we look at say for example the hourly chart we can see How far it went. Yeah, so we didn't really even take out the lows of yesterday Actually, if we draw a horizontal line through that There One 1645 is a fairly decent area of support But at the same time, we've got a fairly decent area of resistance all the way through 117 30 here, and I think that's likely to be Probably the extent of it over the course of The next few hours that's probably going to be your range. We'll have to wait and see But overall With the weekend coming up I can't really see us breaking too significantly out of this range Apart from maybe a slight bias towards These peaks that we saw earlier in in the week Um, has anyone else got any other questions? Otherwise, I'll quickly move on to dolly yen And drill down into that So we've got a daily chart at the moment. That's looking a little bit oversold So looking for a little bit of a yen weakness there, which also coincides with um A slightly more risk on strategy. Let's go to the four hour chart And we can see that there's a decent area of resistance Around about this peak here. Let's look at that peak. See where that level is. It's around 109 80 So that's the peak from a few days ago And there's I think you could probably argue that there's a decent area of resistance through there as well We can see that as identified by the little pink line that I've got there And when I look at trading these when I look at trading these particular markets These are the sorts of things that I look for I look for highs and lows Which repeat themselves over time And then look for potential areas of support or resistance on then potentially reacts to the breakout of those levels So get rid of that there Euro yen The old favorite that's been quite a mover over the course of the past few days And here again, we haven't got as bullish a reversal on euro yen as we did on euro dollar, but nonetheless It still does seem to be showing some signs of carving out a little bit of a short-term base In the in the in the shorter term and if we look at a weekly chart on euro yen We can see it even more clearly on this chart here Let's blow it out a bit looking at the cloud support On the weekly chart Look at that candle there. This is the weekly candle So that suggests to me that even though we broke lower We've been caught in a massive short squeeze all the way below this Low here at 128 127 85 and it's caught an awful lot of people out So In the context of euro yen, I would be very reluctant to push it aggressively lower We could see a bit of a squeeze back to the 200 week moving average but again Very much a case of sell the rally I think on euro yen On a move back to this area here 129 And then look to maybe go short around about that 129 level On a move back through The 128 level that we've got here Any other questions ladies and gents? Done euro yen. We've got um, we've got we've got a Got the rba next week So let's have a quick look at the ozzy dollar It's always a favorite Given we've got services PMIs as well So let's try the ozzy dollar Now the ozzy dollar is looking particularly interesting I think because I think there's some evidence that it could be carving out a little bit of A short-term top we broke below this trend line here Let me remove that line. This is the weekly chart. Let's take it down even further This is a daily chart. Let me just change that 10 6 3 Nice little resistance level coming in around about Here So this is looking to me more and more like we're probably going to trend back towards this trend line here Uh, and potentially come back lower again. So decent resistance at 76 On a shorter term basis if we drill down even further we've got A nice area of support Coming in through here. This is where linking the lows can be quite interesting In terms of the overall picture But looking to sell rallies back to 76 and even this trend line here for a move back down Towards the lows that we saw at the beginning of may and say it's the rba next week I don't think we're going to see too much change there. We've also got ozzy first quarter gdp We have seen a pickup in some of the chinese numbers which should be broadly positive Which should help support the ozzy in the long term in the in the short term But in the longer term, I think a slightly stronger dollar will help push the ozzy down And I think the rba will be broadly pleased with that In the in in the wider scheme of things Okay, so I think Brent crude Now the one thing that I have looked at with Brent crude is how it's outperformed wti wti has gone down this week Brent crude hasn't But what I can't escape from with Brent crude is this bearish reversal on the weekly chart here And that would suggest to me that as long as we can stay below 80 dollars a barrel On Brent Then we may well Have seen the short term peaks for crude oil. I was looking for 82 dollars a barrel On this move higher on the break above this 50 percent level. I've been quite consistent in that call However, I've been I've been forced to revise that because of this tweezer top here And the fact that we posted a weekly reversal A weekly reversal on the candle chart which suggests we may have seen a short term peak. So I'll be keeping an eye on The closing price here the open here and the high here You've got three areas of potential resistance all the way through there and that corresponds to around about 80 dollars a barrel Which would suggest to me that You could well be seeing a little bit of a short term top in Brent crude. We'll see how to how that We'll have to see how that plays out Just been asked a question. Am I right in assuming that on Monday we will be logging to the new updated new generation platform That is my understanding. Yes This is what I have been using to demo this particular item This particular webinar I have been using the new platform and as you can see it's not that dissimilar To the old platform What I would say is there are differences in terms of usability Um, but ultimately I think it's a good experience And I think it's something that you will find An awful lot quicker and an awful lot snappier When it comes to doing your analysis and your trading But obviously if you do have any questions on any of the features Then please feel free to contact our technical support our client support and they will answer any questions that you might have Um, any other questions ladies and gents? Before I get um before I sign off Okie dokie, so if that's it for this week ladies and gentlemen. Thank you Will there be a new mobile app? No, I think the the mobile app will be upgraded, but it won't be And it won't be significantly different to what you're using now Otherwise, I'd like to thank you all for your time. Have a great weekend and um Yeah, have a great weekend and speak to you all next week