 Hi guys, good morning Friday the 26th of July just coming up to court past eight here In London and as you can see on my right hand side the man the myth the legend Mario Draghi All but confirming We are gonna have those rate cuts before he ends his term on October the 31st And he's gonna go that whole Journey as ECB president without raising rates at all which is quite remarkable We've been going back at least six months ago where we were talking about just before he was going to leave at the end of the summer that he was actually going to raise rates and What a different six months may We'll start by going over the markets and just having a quick recap of of things from yesterday And then obviously have a look at some of the news headlines from this morning What's driving price in what's expected? I would say to be a relatively quiet European session before we get to the main point of US GDP numbers 130 UK time so just bringing up the Euro chart here and you can see I Mean looking at that you would say absolutely classic ECB meeting where you get a spike one way Reverse or the other and finish pretty much flat So you could argue Draghi's done an absolutely amazing job on that If we blow it down to a five-minute time frame the initial Headline coming out that they were no rate cut So we were going into this meeting 50% priced in from traders that we were gonna have that cut So that was just an unwind of those dovish bets if you like I'm just gonna put this onto a minute chart now where you can see we spiked higher above the R1 above that 24 to 48 hour range and then the the dovish forward guidance really Led to this move lower that they are going to start looking into this QE program and Starting up the asset purchase program yet again, and that did us drift down pretty much until Draghi walked out so 130 45 minutes after the initial announcement Mario Draghi took the took the stand if you'd like and The low of the day 133 so three minutes into his speech and pretty much when he started reading the statement as he walked out a tiny bit late no real talk of Rate cuts or policy change act yesterday's meeting or for yesterday's meeting that saw us push higher Reverse pretty much the whole move in the first few minutes before pushing on hitting the R2 and since then we did drift lower on that That that push higher that we had and then into the back end of the session We pretty much finished where we started so you can see here on the 1245 we finished maybe Two ticks above so really well done from Draghi We interesting see what happens with the minutes the minutes will be a An interesting release. What did they talk about in that meeting? You know they're saying there was no Policy change talk in there whether there would be I think you can see some more Or some follow-through of some euro weakness from that We are just seeing the the dollar strengthen the touch this morning not just against euro But the pound and you'll see in euro dollars come lower and work from a technical point of view just being aware on the Futures, I'm supposed to move this above the calendar the camera story so you can see 111 70 very key level we had support initially Going back to Wednesday morning Then yesterday morning and afternoon That'll be a key point to to have marked up my my personal view on on the euro dollar Didn't quite get up to you know what would have been a lovely point of entry I do think over the coming weeks you're going to see a continuation of this this Overall trend that we're in just putting this on the 240 chart of four hour We have just been drifting lower and even going back over the last few months any Potential rally you're just seeing the dollar balls come back in. Yes You've got next Wednesday the the Fed announcement and depending on on how dovish they are how their forward guidance comes in We'll depend on this market Going higher or lower, but I think certainly Well, not necessarily certainly, but in my opinion over the coming weeks and months We are just going to continue this this push down and I think 111 The futures and the euro would not be too far away Which you can see today would come in at S2 whether we could get down there today or not I would be unsure effects of you'll come in to those US GDP numbers at 130 elsewhere The bund made a new all-time high on that initial spike of the the no cut The unwind of those dovish bets and then you saw a reversal of that move and more We then pushed down and really came back up to finish near the pivot and you can argue now its business as usual It's continuous. If yes, they didn't happen for the bun in turn that did drag down UST notes as well You can see initial spike from 1245 before coming lower on that much correlated monetary policy move the DAX similar to the Bund and you had the initial spike before reversing a lot of that We haven't actually and you can see here that the DAX just going to go through that Increased volume period from the open the DAX didn't really recover from yesterday afternoon and that move coupled with US stocks coming down at the same time you can see very correlated across the the board There for European and US markets overnight. We did have some earnings out from some of the larger companies alphabet Shares rose about 8% after the company reported quarterly results that eased investors concerns about the growth challenges facing its Google advertising business So driven by ad sales second quarter revenue and earnings beat analysts Expectations in addition the world's largest online Search and ads firm unlike number two online ad player Facebook A day earlier offered no worrisome guidance about increasing Regulatory scrutiny so we saw and we can have a quick look over at the Nasdaq here in We also had Earnings out of of Amazon as well which slipped and we'll come on to that in a moment But you can see which way the market decided to to take this Certainly over the last few years when there's been good and bad news at the same time It's going to go with the good more often not for these stock markets We had a really strong push higher which helped bring that S&P and the Dow Jones in correlation With it a bit higher rather than the DAX which is obviously still remained lower from yesterday's push So the yeah, you can see here the Nasdaq back to pretty much where we were before the press conference from from Dragon yesterday Obviously the tech sector in the S&P benefited a touch as well from them We have drifted on but nowhere near as much as the Nasdaq so all good there for for Alphabet pushing about 8% higher conflict for Confliction there you had Amazon who were worse than expected the first profit missing two years Said income would slump in the in that current quarter as the online retail that ramps up spending on one day delivery To spark sales growth. So first missing two years hasn't necessarily worried investors only drifted down about 1% Which is is crazy really considering You know the moves that it's been having over the last few weeks and months and years so only 1% miss on that Looks as if people may already be interested to certainly buy the dip and the stock markets in the US not worry It seems we're yet again in the build up to these earnings. They're going to be the worst for XYZ That's all priced in and then unless they're really bad the markets aren't going to blink and it does seem going into next week That's all put behind us. It's going to be The cut we're all expecting stocks could continue this this push higher into the election and Trump will be tweeting happy days So yes, Amazon worse than than expected the just going into a bit more detail there the they actually said the company Also said its investment in faster shipping was starting to pay off. So positive with revenue rising 20% 63.4 billion in the second quarter ending in June that topped and that Analysts estimates and the 17% rate of growth that Amazon posted in April So while shares did fall there was some positives in there, which of course would have capped price A touch and you can see here the NASDAQ well continuing to push on this morning quick look elsewhere in the markets Just to have a quick look I didn't mention there's a bit of dollar strength And you have seen the the pound certainly overnight Pushed to this low and worth keeping an eye on this level that we're trading 124 54 in the futures quite a lot of support around this area from Well going back to the 23rd so Friday Thursday Wednesday and Tuesday and also back on the 18th last week as well So quite a lot of support around here. It was all going okay for the pound yesterday Not really too interested in in what was going on and then we had a couple of tweets that well a tweet that came out I'm just going to transition over here. So Alex Barker just tweeting What Michel Barnier's email to EU member states? Work was and he was basically calling Boris's statement rather combative and basically Unnegotiable this was squurts around well, you can have a look at the chart You can guess when it was squorts pretty much scored bang on 430 445 and and or that should maybe a bit before that when we first started coming down before The sort of European clothes and the pound gathered a bit of momentum or the cable gathered a bit of momentum to the downside Euro pound pushed higher and we have seen a really a continuation of that wouldn't necessarily It's all driven from that that headline as such the the dollar did strengthen a touch yesterday And we also saw a big technical break in gold which will come on to in a moment But what does keeping a you know near to the ground on on what Europe's view on Boris Johnson is and are they? Going to go into the negotiating table and are they happy to make changes is Boris going to be able to do so We also had a tweet from Steven Swinford Here if I just transition my my charts again who is just saying that you know Boris is is out and about He's hitting the road and this is what you know Anthony had been mentioning. We were talking about this yesterday You know, he's gonna be heading to these these places up north the You know on Saturday here giving a speech in Laebusy in Northwest He's also going to Birmingham over the weekend. He's going around talking up The the game if you like ahead of what could possibly be his plan of getting that general election in before the 31st Of October it would make sense for him to to do so to get some support to get people to buy into His plan of getting us out by the 31st And to be honest the way you were speaking yesterday in in parliament as well saying we're leaving 31st no deal Or deal You know none of this, you know, this is not what we want. We're gonna do it What better way to to try and get people on side for doing a bit of a tour whether it'll work or not time will tell I think everyone could could agree there's a bit of a laugh watching him have a go at Corbyn yesterday His speech was was quite interesting But just worth keeping an eye on this as well, you know, the more Boris goes round does his popularity grow What's going to be the impact then of a of a general election? You could argue in in the build-up to This general election gathering speed that the pound would come under a bit more pressure Certainly not really looking all too rosy for the conservatives at the moment They even necessarily not necessarily have made any progress over the last few Months when they should have but if this general election was to be called more uncertainty and then it will have the price in You know are the conservatives gonna Take back their mistake from when Theresa May called one back in 2017 If that was to be the case and the conservatives were to come out on top Well, I think you would see a bit of a pound rally and euro pound would come lower You would see euro dollar release appreciate a touch as well As he would have more room on that negotiating table. He could go to europe and go look what i've done I can now deliver this this deal Can get this all passed through and we can go from there So worth keeping an eye on on these couple of things what one what europe is saying about Boris and to This idea of a general election getting called and he would have to call it before the 31st of october And of course as we go into to august next month where you know a lot of a lot of guys are on on recess You know, so you could even be called soon if not maybe You know september, but then it leaves little time for For Boris to go around and really rally rally the troops so to say Going back to to the chart. So yesterday with with gold we had a a technical break And i've been ironing this up for For a while and you can see here just going to put this on to the four hourly chart Going back and i'm just going to move this to the other side of my camera quickly so you can see where it starts Back on the the end of Of may here starting on the 30th We then had another test on the 17th of july and we were really getting squeezed in each one of these days of the last few Weeks and then price finally getting that breakthrough yesterday. We've confirmed that that break below We hit what would have been ideally the first sort of target 14 14 on the futures And now we're back below that trend line if we were to push higher today We'll be very interesting to see what happens Around that point if it was to happen in the next hour or so that would be coming in around 14 26 And we remain obviously some very key resistance up at the top, which we just could not break through So price was really getting squeezed in from both directions You got that breakthrough breaker that trend line could be key going back to gold certainly From a couple of years ago when you do get these big trend line breaks You can see that it really is strong moves and here i'm just going to start this one from December to 2016 we got the break through the 11th of june and what a push down I'm not saying that's going to happen now by any stretch of imagination But just when gold breaks these trend lines you can get obviously quite fast moves And where we close the week will will be important Back to some of the headlines or lesser headlines I should say you had this come out overnight or from yesterday spain's premier But also avoid snap election despite defeat this could have been possibly A bigger story the euro is not biting off it So yesterday Sorry yesterday the bowler to avoid a new general election Which would be the country's fourth in as many years and will work to burn a coalition Which has remained elusive despite two parliamentary votes. It's not enough to really drive price In the euro it was a bit of a risk to be factored in But you can see if we look at price now you would say nothing nothing has happened from that Elsewhere another headline today not necessarily new news But iran test fires medium range ballistic missile Earlier in the week and the us are now aware of it. What could this mean for for oil because it's not really new news I would say business is as usual and let the market tell you what's going on You can see we are getting squeezed in from both directions So on a day like today for for oil I'm just sitting back and waiting for price to either get above the trend line or below and Not necessarily saying we're going to really blast out the gates when that happens on a on a break of it But that's what I would be waiting for really to look us to get above Well at the moment that would be around 56 40 or 56 handle on the dot so Quick look over the markets right as we're trading now before we have a look at the the calendar you can just see Let's put the the gold on here And the pivots you can see a bit of dollar strength Against the pound more so pound weakness you would you would argue as euro pound is back up to its high from yesterday Euro was under a bit of pressure I would still be keeping an eye on 111 70 on the futures Stocks in the u.s. Certainly seem as though those results yesterday from amazon of alphabet have been taken as a positive So a favor for now an upside unless we were to break one of these trends to the downside Which you can see we're not far away from getting that third test just above 30 10 And the pivot so for now favor the upside you're lining the sand for you know the buyers and sellers above where we're trading 30 16 bit of resistance here previously support As you can see similar to oil it might not be the worst idea just to wait for What price does around these two points between 30 10 and the pivot and 30 16 as a whole and like I said with oil Just waiting for price to let you tell you what is is really Going on moving over to the the calendar for the day mentioned at the beginning It's going to be quiet not much coming out a tool of interest Not even any speakers usually after an ecb meeting you will get source comments that come out We did have some overnight ecb policy makers see rate cut as done deal on september Sources you know just trying to make sure the market does understand ahead of september that there's going to be a rate cut So there's no surprises. I mean straight after 1245 is 90 priced in anyway But certainly today just maybe keeping an ear out or keeping your Your your your tweet decks with the The search as ecb sources wouldn't be the worst idea just in case there is any follow-up comments to yesterday's meeting As we drift into the afternoon. It's all about us GDP and really once that's done It could be done for the week to be honest Expected at 1.8 percent. So you can see that would be the the lowest for quite some time for from the us gdp numbers so It would you know down from 3.1 percent And would post its Its first decline in in in a while GDP They're saying it rose one well analysts reckon it's going to rise 1.8 percent on an annualized basis in the second quarter Which would be the slowest since 2017 The GDP report however is is unlikely to make too much difference ahead of the the fed's decision next week However, it could obviously have an impact on future decisions that they're they're going to make And that data detail will help Sort of form their opinion on the central bank's thinking of whether they're going to follow up with additional easing this year So 1.8 expected so off that no real reaction But you can see the range 1.1 to 2.9 is is quite big if it was 1.1 Well, then suddenly You know it's not looking too good and you would see yes stocks come down But then again a better opportunity to buy on the fact that they're going to have to start cutting a bit more You would see dollar weakness from this which i'm sure as donald trump wouldn't mind too much And either way good or bad number trump is is going to be tweeting if it's bad It's going to be well-lipped the fed of of course this we need to We need to be cutting if it's really good You would then talk about how good it is and how much better it could be if the fed weren't Being tight with monetary policy the reason why we're expecting the the 1.8 You guessed it trade so trade is is the reason this has been Expected to to be bad. So 1.8 expected but quite a big range. So something just to factor to in there As well Just quick look over the market one more time to see what's happened following the the decks open and if anything That 35 minute period from from the open Eight o'clock will will tell you What is expected from today's morning session not much probably the quietest open certainly of the week That i've seen from europe so i wouldn't be looking to get into aggressive Really is the market just waits for those us ggp numbers as usual any questions obviously please do let us know If i don't speak to you Throughout the day. Hope you have a great weekend It seems as though the sun has gone for now looking very gloomy here in london But i think that might be a Bit of a refreshing change for people after not being able to sleep for a while I hope you'll have a great weekend and i'll catch you all next week