 Okay, very good morning to you Tuesday 20th of August. Hope you're doing well Before we kick off the briefing just a reminder for tomorrow night Sam and I will be doing a live YouTube session from 6 p.m. from the office It's gonna be based around a kind of Q&A format of which we're gonna bookend the session with coverage of the FMC minutes live So all you need to do is go on to what you're on the YouTube channel now Click subscribe and then hit the notification bell and you'll be alerted about five minutes before the session begins with a Automatic push on your on your phone or if you want to watch it on your desktop. There'll be a chat facility So it should be quite a good event and also with a market piece of information coming out at the end So hopefully you can join us But otherwise just moving on to not so much the headline here. We'll get into that in a second the charts this morning Fairly quiet session really overall yesterday Much of the week as we were looking at it at this time yesterday was a based around a couple of key Points of interest in particular on Friday when we hear from the Fed chair Jerome Powell, of course That's that's probably the biggest thing that's happening Although we have some other points of interest like the FMC minutes. I'm seeing Wednesday We've got the ECB minutes as well coming out later in the week But this is quite typical people are waiting that kind of main event. So Monday was quite quiet Or be a positive finish Across the three major indices. So managing to claw back a little bit of the losses that was seen from from last week a couple of other Headlines to be aware of from Trump tweeting requesting more rate cuts and now quantitative easing a Washington Post source article talking about further fiscal stimulus potentially in the form of tax cuts of a few other things as well that Interesting Fed comment as well from Rosengren that we're going to review in a second But looking at the charts this morning largely a reflection of that probably the most distinct Factor of the morning is a little bit of a continuation of dollar strength the Dixie albeit flat It's testing at the moment technically an area of Some near-term resistance and definitely worth keeping an eye on the major currency pairs And particularly cable still remains one. That's very closely on our radar. It had a decent kind of recovery if anything last week A bit of a pullback from what had been what looked like closing in on a Retest of that post-EU referendum low that never really quite materialized But we're still just around a point away from that at the moment So we're still keeping an eye there euro training at the 111 handle this morning Overall pretty flat, but again with overall prevailing dollar strength isn't and I'll show you some other charts in a second The difficulty that the US are having at the moment from both the Trump more importantly Point of view and also from the Fed is that with all the other global central banks easing It's kind of the fact that the US is a little bit further ahead in the monetary kind of cycle of where they are and their economy is generally Performing albeit slowing sign showing some signs of slowing down things are just worse elsewhere globally And so as a default factor then the dollar kind of outperforms and if there's any positive signs on the trade war as well That obviously helps the kind of overall sentiment for the dollar and so That's not good of course for mr. Trump Because it continues to make the US in his eyes ever more uncompetitive against what he feels is market manipulation On behalf of a lot of other foreign central banks to it artificially weaken their currency So we'll have a look at that in a second Outside of the FX markets things are very quiet fixed income The 10 years basically flat a little bit of a higher move in bunds this morning. I think if I look at the calendar, there is a Some talk about an auction I'm not sure if it's whether it's today or tomorrow coming out from Germany that could be quite interesting just given The negative yield curve at the moment Otherwise oil pretty flat Gold the same down marginally, but nothing really too interesting this morning. So I'll let Sam go into that more Let's get straight into the news This was the first one. I want to talk about this came out yesterday and did help Bump the market up a little bit and this was according to a source in the Washington Post They was talking about a senior White House officials are discussing the possibility of a temporary Payroll tax cut in an effort to boost the economy in the face of a potential slowdown now This is quite interesting because you know, there was an article in the FT I was reading that was written by quite a senior chap at Black Rock this morning And he was talking about the fact that central banks are running out of ammunition And and this is where really the fiscal side comes in And certainly this has happened before in the wake of the financial crisis Payroll taxes were temporarily cut by President Obama at the time in order to boost consumer spending in the initial phase of the recovery post financial crisis But that expired in about 2013 and so it hasn't happened before but obviously it's another form if you like of trying to Counteract if there were signs of a looming Economic downturn interestingly. I wonder how much of this is just trying to Kind of fight and push back against this media narrative of that inversion of the yield curve You know, I was looking at the kind of Google metrics of people searching of recession and these types of things or word counts of Articles mentioning that word and it obviously spiked last week and it's one of those things where as long as the The parties at play that being the government and the central bank can get hold of that and try to Mitigate the runaway heard belief about a recession Then actually then you can kind of stop that self-fulfilling kind of prophecy to some degree because ultimately that to a large extent Can be what drives? These inversions is when it becomes this kind of almost Fixed belief that because it's happened before it will happen again and that ultimately then leads to the same thing happening if that makes sense so How much of this type of you know drip feeding in this type of article is as much as actually you read it It seems it's a long way off of This idea being implemented or even brought forward to Congress It's just interesting that this tends to come out after what we had last week Which is obviously a kind of build-up of this idea of a downturn is looming and so to counteract that quite interesting Attempt I feel by the administration to try to drop these types of Source comments, which we know where they come from in all honesty. So that was that was interesting one yesterday The other one was This chap not sure if you do recognize him or not, but he is a the Federal Reserve Bank of Boston President so in terms of the 12 regional banks in the US that form the kind of monetary policy committee members This chap is the head of the Boston one His name is Eric Rosengren. He is a voter this year and he Interestingly in an article said he signaled no willingness to support further interest rate cuts Saying the US economic conditions are still good and that easing policy would encourage a worrying debt build-up So again, he said that he signaled no willingness to support further rate cuts now One thing to be aware of here is this is that Hawke Dove spectrum if you like and as you can see here in 2019 Rosengren is a voter but other than master and George Rosengren is one of the most hawkish members out there and so he has dissented before I disagreeing with recent cuts So it's not that surprising, but if you think about this idea of Dollar appreciation this certainly is not helping Trump's ambition of keeping the dollar weak because it's this type of commentary that obviously starts to then Counteract some of the markets, you know, quite dovish expectations about deep rate cuts when you've got people like this dissenting All be it fairly in line with their their general stance on on policy Another thing that I did see last night that I think you do need to be aware of when we get to the open of Wall Street a bit later and this came out in the Wall Street Journal again citing sources, but effectively saying that If I get the main crux of the article a group of states is preparing to move forward with a joint Antitrust investigation of big big technology companies according to people familiar with the situation Adding another layer of scrutiny to industry already under the federal spotlight. So again This is important for the fact that those big Kind of names that can be highly influential if you're trading the index future So the likes of alphabets Google Facebook Amazon all these types of companies obviously if they see a meaningful reaction to further antitrust probes That could be an interesting factor for the open on Wall Street later on this afternoon Not not the first time we've heard of such type of action But a continuation of this and the more impactful it could be on the bottom line of these companies then the more It's got to be factored in in terms of the the the price in the context of the here and now This was I mean we talked we talked so far about the strength of the dollar and and this really is Capturing quite a lot of the attention obviously dollar gained fueled in part by comments and Fred Rosengren as we've just discussed But the dollar is soared to new 2019 high. I mean if we look at that on a chart This is what we're looking at This is a picture of the Bloomberg dollar spot index As you can see here having retested a high that was seen very early this month That puts us up in a retest of an area right at the beginning of June and then that means we haven't traded really this firm in the dollar Since where we were in December of 2018 now if you remember that was in a period of where the market was in a short-term Kind of correction phase that was led by the fact that the Fed was still committed to multiple rate cuts or rate hikes Excuse me at that time The weakness of the dollar here was that big rephrasing or policy change of direction Where they basically said no we're not gonna cut which was quite a radical shift for them to counteract the downturn At the time but we've come all the way back up. So this is one of the balancing acts really for Trump more positive He might be on the trade talks then the more then that starts to kind of build up the idea that well Probably lesser need for aggressive rate cuts more buoyant for the US economy In terms of the any evidence of a slowdown if you remove that big macro risk and that by default Then strengthens the dollar, but the stronger that gets then The more it can be to the detriment of the US competitiveness. So, yeah Expect more from Trump kind of tweeting and trying to control the situation It's kind of the one downside perhaps to Trump's strategy of trying to kind of bully the the market whether the Fed Whether through fiscal policy and so on or whether through threatening government shutdowns and positioning themselves and posturing in Congress is that You know the more he tries it's almost like the more you do something the less Potent your actions become and so that's probably the one risk I'd say that Trump does run by trying to really manage these so Frequently and of course the man himself did tweet last night. This is what he said He said over a fairly short period of time The Fed basically With interest rates should be reduced by at least a hundred basis points With perhaps a little quantitative easing as well If that happened our economy would be even better in the world economy would be greatly and quickly enhanced for the good for everyone So again Trump now you remember he was calling for Powell when they did the original rate cut a few weeks ago to go 50 Not 25 the Fed Disagreed and went 25 Trump now is upping the ante. He's gone for let's cut a hundred and do a little QE as well so Definitely more pressure on on Powell and this is all quite tactical If you listen to if you were to go back and do an assessment on Trump's tweets ahead of every Fed meeting He tends to then really be quite critical of the Fed's policies and given the fact that power speaking on Friday This is now his you know the art of managing the deal He's now Trump putting a bill bit of insurance policy into play Because I don't think pal listen to him I don't think pal definitely needs to go nowhere near as far as what Trump wants But then if the economy responds to power well fine for Trump if the economy then starts to weaken further And equities let's say start to fall because of a lack of Fed action Well, then Trump wins as well. This is one of those again It's kind of ABC of managing the situation for Trump where he's limiting his downside in that respect So yeah more of that to come I'm sure other things just to wrap up the headlines Not really a great deal of movement. I'd say on the back of this But we had the RBA the Reserve Bank of Australia minutes overnight in summary They said they're ready to cut interest rates further if evidence suggests that that would boost the economy Members would consider further easing of monetary policy if the accumulation of additional evidence Suggests this was needed to support sustained growth So they're still keeping very much a downside or an easing bias, but I'd say that last comment Talking about the accumulation of additional evidence means that there's a fairly significant bar I would say in order for them to start, you know Continue to commit to delivering of more cuts in the future So yeah, if anything, I'd say the Aussies picked up overnight rather than eased on the back of the latter part of that comment And then the final thing is Brexit the power not really reacting to this I'd say any weakness in cable is more by product of some of the bollow movement of late but Boris Johnson Basically in a letter to European Council President Donald Tusk yesterday Johnson said he wants to replace the so-called backstop provision in a divorce agreement with the legally binding commitment Not to build infrastructure or carry out checks between Northern Ireland and a Republic of Ireland So I'm not sure about you, but I'm getting slight deja vu Isn't that what Theresa May said or what Theresa May wanted and he's saying exactly the same thing So much for changing it up on the most contentious issue of trying to negotiate Brexit. So Yeah status quo nothing really changes. What have Europe said in response to this? They've said, you know, this is just a waste of time. You've not brought anything new and again such as this Negotiation has gone. There's a real lack of detail about what some of these alternatives could be which there's no substance to the discussion so all in all Not really much new going on here at the moment on the on the Brexit side quick look at the calendar What have we got on the docket for the day ahead? Very quiet in the morning to be honest So I'm sure as Sam will explain. I'd just be really more conservative sitting on the hands Waiting for the US session to really kick off as I said I'd be interested to see how stocks react if any in the tech space some of the big companies on the back of that journal article that came out last night and then from a US Perspective on the scheduled economic data. There's really nothing of great magnitude until we get later on this evening for the API weekly crude Infanteries No real fed speakers until much later on in the in the evening So I'd say still likely to be unless anything unexpected Materializes could be a bit of a repeat of yesterday fairly tame session. I would be more Kind of utilizing a technical orientation to some of the setups without the lack of any real Fundamental catalysts really at the moment keeping an eye on any further continuation of strength in the dollar I don't see any reason for that really at this point to change too much And so maybe just looking eyeing up the technical levels on the downside for euro dollar cable Could be something of interest and I'll let Sam discuss that in more detail. All right, that's it for me Have a good day, and I will see you in the chat room. Thanks very much Thanks and and yeah for tomorrow looking forward to catching up with you all as we go live and just having a look over start off with the euro Which eventually more so into the evening did did make its way lower and just having a look Here on that longer time frame just because Let me clear the pivots up now We were talking yes in in the briefing and in that strategy report same for euro and pound at the potential of just looking at The lows of the year to make these these trend lines And of course this will be all about where we finish the day But you can just start to see we've already got that third test or we're looking to make that now for the euro So we're keeping an eye on that where we close the day and if we were to get below there That low of the year can come quite quickly Looking more intraday and I'll put the pivots on here just to give us a further idea of where we're trading you can see Back up towards the pivot this morning is as acted as a good level of resistance along with yesterday mornings low I Think you know we can get back up there again I mean for the dollar strength side of things if we were to get a break of that trend and I Think could be a half decent Opportunity we perhaps want to start looking to get on these these trend lines as well Should we push higher from those previous highs that we've got as well to see if we can get that third test But we are supposedly you know if you look at this area that area perhaps looking to make it a new range as well So that data calendar again pretty quiet in the morning So maybe like yesterday just waiting for that trade to actually happen And maybe break either to the upside or the downside is better rather than maybe looking to to get in Around these highs again. So potentially looking under there I think could be the trade to go with and for the pound. It's pretty similar I mean you can see just from the low that we had last Monday almost coming in to get that third test of The trend line here as well. So keeping a close eye on that see how we respond to this trend line Which is also in the future is coming in around 121 as the opportunity could well be on a break of that And a decent enough move and suddenly again. You're looking down towards the low parts of the year And then then people start talking about that 120 again so a bit of dollar strength and sir the back end of the evening despite what What Donald Trump would have wanted Also to the upside you can see if we were to go worth keeping an eye on some of these trends that we have been Respected quite well. Obviously that seems quite far away for now and like we saw yesterday around eight o'clock the selling has started For the pound against the dollar that euro pound will just have a quick look at as well Which we talked about just the importance of the level we saw on Friday's Loak, which is pretty much exactly same as the last day of July and that still held quite well Again, however, you are starting to get a bit of a trend. So but both of these markets Well, all three of them you have got these trend lines from those lows Which are worth keeping on because they were to break you could see a move either way for the euro and the pound against their dollar pairs as well S&P to bring in another Another good day to the upside To back-to-back strong days Friday and Monday has led us to to get up towards that pretty important level 2940 was a high that we had on the 13th the eighth and some nice resistance on the second as well just looking at this on a Longer time frame as well. Let me just remove the the pivots would just start into Just remove This all here We're just starting to then get that third test. You can see so like that euro We've already hit it and it'd be important to see where we finish the day So you've got the second of August the 13th and now today as well Just finding quite important resistance and the price action We've seen going back to the beginning of August so this month does quite remind me I'm just moving this here to have a look at the October November December time frame and I remember being in actually in in Dublin at the time when We just couldn't get above this trend line here on the third of December despite some really positive days To the upside We just couldn't get a brother and then we had something negative headlines that come through and just like The high of the year, which is that trend channel from the previous to all-time highs technical Analysis can then lead the way to a further push low with some negative headlines that come through so just worth keeping an eye On what happens here and certainly if you're a ball you want that level to break You want us to get a test of all that area that twenty nine forty area and then suddenly Yeah, sure you can be having a look back towards that low of the area We broke around around 56 and of course 3000 and the all-time high, but important point I would have marked up there As well I'm gonna look over at gold see how we're trading to date Let's put this on so it's 60 minutes so you can see just from that daily candle drift lower yesterday and we did late yesterday Come back to test the the Friday low which is acting as acted as pretty good resistance and the bottom area In which again is a zone 1504 203 We found pretty good support there as well. So keeping an eye on all those levels still we're starting You can it's not the most amazing trend in the world But you can see from the high that we have back on the 16th. We're just getting squeezed in there a bit I think with the low volume certainly you're gonna have in the morning again It's probably worth looking at this as a bit of a new range for the market to be in here for gold from 13 to To 0203 is where I would be Focusing on that to the downside if that was to go so you've got the the whole area From that lower spike around the s2 But with that just being a bit of a stop run if you like I'd still have marked up below the 12 at 1498 and of course the 1500 level if we were to break that trend 9 and get above the the range obviously we're then looking towards The R1 and some nice resistance from the Asian session Yesterday quick look at oil before we have a look at European equities Which is just trying to test those highs as we speak Oil like with stocks yesterday just grinding higher really from the afternoon into into the close and Just let me just draw we had this trend line on yesterday See how That was coming in was it this one Well, not not the best respected, but you can see we've continued to push higher I actually quite look and I've got it marked up on my charts on Computer on the left. I quite like the look of the pivot today. You've got quite a lot of Resistance we just couldn't break for yesterday before finally getting to go Into sort of the European close and 55 72 that kind of area on the futures is Somewhere I like the look of to the downside unless we were really to to break all of that and then this trend You know, I do prefer this market pushing to the upside also worth having a look at this just over the last It's a few weeks now. Isn't the the best trend in the world But you can see with just kind of wash it's not bad to me. This is pretty good I'll be keeping an eye on on should this should we come back into to test it just above where we're training So the pivot important to the downside, but also this trend line Which is pretty much marked up with the the hide that we had of the the morning of the sip Sick the 14th 56 54 would be that another test of that trend line So really important little mini range here in oil from 54 down to 73 That's where I mean, that's the key levels that I'd have marked up a daily close above that trend and we can be looking towards the Well, that's certainly the highlight but if we break below the trend that we start to form from these recent lows Well, the market can really start to turn so the S&P and oil on massive important trend lines the euro and the pound and euro pound So you're a pan against the dollar and euro pound all coming to important trend lines to the downside quick look over at the DAX just to Confirm what we were talking about a couple of seconds ago Just how we're coming to test those highs and worth keeping an eye obviously for the US equities as well What happens here with the the DAX if we were to get a break of that Then the S&P looking to to get to its high as well just bringing in that point worth maybe just reiterating this Resistance we were talking about in the briefing yesterday. Just how important that that whole area was 11,844 give or take a couple of points side of the way So a break above the the high from yesterday the R1 and you know This is the the key level perhaps for the week and to the downside like for the S&P The pivot is pretty important already had a couple levels of support there break of that and then you're looking down to the morning Low from around 945. So a bit of a gap below the pivot and more importantly up towards yesterday's high And above there then we can start to get a bit more Excited any questions as usual do let us know the pound that she just coming under more pressure here So that trend line that we were talking about just to wrap it up important to keep an eye on this We just draw that on you can see we're having a go here getting below that 121 has been tested again. So keep a close eye on that level there in the power not looking too good Any questions, please do let us know, but I hope you'll have great trading day