 Mr. Nona, welcome to CMC Markets and welcome to the January non-farm payrolls report with me, Michael Houston. This week's been an interesting week, if I'm honest, because I think unless we get a really dire report, then I don't think we're going to see that much of a market reaction. And let me explain why. About a week ago, the expectation was that we were probably going to get, or the market was hoping that we were going to get a rate cut in March from the Federal Reserve. Now, the regular listeners will know that I've always been skeptical about that. And it was actually quite nice for Jerome Powell to pretty much rule it out on Wednesday evening. Ultimately, he said the base case, the Fed's base case for a March rate cut, it wasn't a base case. So when you actually look at the data, I always thought the pricing was a little bit optimistic. And even if we get a really core report today, I should still think that it's unlikely that that pricing will move back towards March. I mean, the Fed has said it's data dependent. And certainly on the basis of this move that we've seen this week in two year yields, we can certainly see that there hasn't really been that much of a move. If you actually look at what's happened over the course of the past couple of days, in fact, equity markets have pretty much shrugged it off. On Wednesday, we saw the biggest one day decline in the S&P 500 since September. And yet here we are, almost 48 hours later, and the S&P is back towards record highs of only a few weeks ago. And the DAX itself is also rebounded quite strongly. So we're still very much, I think, and what can only be called as a bit of a Goldilocks scenario is in that the US economy continues to perform reasonably well. It's not in dire need of a rate cut. And all markets have done is they just pushed March out to May, which means that the Fed may cut rates in May, or they may not. I think it's very much data dependent. The latest estimate for Q1 GDP, the Atlanta Fed now cost estimate of Q1 GDP is 4.2%. Well, we just come off a Q4 number of 3.3. We're expecting 2%. So for me, I think that still makes it highly unlikely that the Fed is going to be in any rush cut rates. The only elephant in the room with respect to an early rate cut is obviously the election coming up in November. And the Fed, I don't think we'll want to start considering cutting rates in the second half of this year in the run-up to a presidential election. So we may find that we will probably see a rate cut sometime in May or June, but I certainly don't think we'll see one before that. And I think essentially, that's what Mark is surprising. And obviously, we saw the Bank of England yesterday. The Divergent votes there. The two votes for a hike and the one for a rate cut. And once again, you can sort of understand the Bank of England's dilemma when it comes to cutting rates. So I think what we can say is that ECB, Bank of England, the Federal Reserve, they've all gone some way to basically telling Mark, we're not going to be raising rates anymore. The bigger question is when that first rate cut comes. And that for me, March was never likely. The market is slowly starting to come to that same conclusion, which really sort of brings us on to today's payrolls report. And there are a number of factors at play here. To be honest with you, unless we get a number wildly outside consensus, I can still conceivably conceive that US markets will continue to push higher. I'm not particularly comfortable with that idea, given how rich evaluations are. But essentially, as with anything with technical analysis, you trade what you see. And at the moment, we've seen this week's volatility. Obviously, this is today's price action that was yesterday, that was Wednesday, and that was Tuesday. So we've had a choppy week. And I think this is what's likely going to continue to be the case for quite some time. The other thing that has concerned concerns me quite a bit. And I tweeted about it earlier this week. The top five US companies in the NASDAQ 100, top five, account four, or all the companies that were reporting this week account for over $10 trillion of market capitalization, $10.5 trillion. The total market cap of the NASDAQ 100 is $20.2 trillion. So essentially, you've got five or six companies in the NASDAQ accounting for more than half of the entire market cap of that index. So essentially, if any of these companies attach a big, big cold, and at the moment, judging by the numbers that we've seen so far this week, that doesn't look likely, then the uptrend that's been in place since October certainly has scoped to go further. And even if we do get a correction, you know, the 50-day moving average here, the trend line here, it's still likely to be reasonably supportive. So I've got the NASDAQ, that's rebounding quite nicely on the back of the meta numbers overnight, but also the Amazon numbers, Apple's slightly disappointing, that is probably going to open around about 2.5% lower. Meta, on the other hand, is expected to open 16% higher. It's already recovered from the record from the big losses of 2021. Let's zoom this chart out. This is the 2021 highs. This is the 65% decline. And now we're back above those previous record highs and likely to open all the way up here later today. I mean, that's just completely mind-boggling, eye-watering, whatever you want to call it. But ultimately, it's momentum. And markets very much are driven by momentum. And at the moment, momentum is positive. As far as foreign exchange is concerned, you know, Joe, what can I say? We're range bound, and I see no evidence whatsoever that we are likely to break out of the ranges that we've been in over the course of the past few weeks and months. So looking at euro a dollar, have you got a particular currency pair in mind, Joe? Because if you have, I'm more than happy to cover it. But certainly euro a dollar, very much finding support just below 108, quite a lot of bids through there. We can see that with respect to these series of lows in December, but also of the lows of earlier this week. But on the other hand, we've got resistance anywhere above 10920, 10930. So I think I don't think today's payrolls report is really going to shift the dial too much with respect to that. Now, dollar yen, I'm glad you said that, I used to trade dollar yen. That is probably the most interesting currency pair of all of them, because we have started to see a little bit of softening in the dollar. But we are currently finding support in and around these sorts of levels around about 146, 14580. So I think if we can break below 14580, then I think there's a fairly decent chance we can retest the 200-day moving average. But certainly on the basis of the fact that we are probably not going to see a rate cut until May, that should be mildly supportive of dollar yen while or above this area of support in and around 14580, 146. So on the other hand, we see a particularly weak payrolls number. That could well be dollar negative going forward. But certainly I think we are starting to sell in a bit of a range. Dollar yen looks to be toppy at the moment anywhere above 148 to 150, but it's also finding a few bids in and around the 140 level, which probably isn't particularly helpful to you. But for me at the moment, it does appear to be starting to show a little bit of signs of a little bit of softness. And consequently, we could well start to see a little bit of a drift flow. But this area of support, this cloud support here is likely to be a fairly tough nut to crack. But if we can break below that and into the cloud, then we could well drift back to 144 over the course of the next couple of weeks, perhaps. So that's dollar yen cable. Again, we can pretty much sum this cable move up by a really strong support, 125.90. I talk a lot about that in the chart forums on here. So if you're on the spread back platform, I usually do a daily update or even a twice weekly update on where I think the key levels are on cable. I've done the same thing on dollar yen as well on the spread platform or update where the key levels are. But at the moment, we're cable with 125.90, 128.20 on the wide of it. I still think that pound for pound, we're probably going to head higher, no pun intended. I think we can break above 128.20. The long term direction for cable, I think is higher while we're above this area around about 125.90. So certainly I'm in the camp of buying dips on cable. Euro dollar, as I say, is slightly more tricky. If anything, I think Euro sterling could well drift lower because I think of all the central banks that are probably going to cut, the ECB will probably cut first, perhaps as soon as April. But I certainly think that the Federal Reserve and Bank of England will come after the ECB. So I think that for me is the direction of travel, I think in terms of the main currency pairs. Next week, we've got the RBA. So I'm quickly going to cover that. Big support in and around 65 on Aussie dollar. We are starting to trend a little bit higher. And I think the RBA maybe may come out as slightly more dovish than it has been, which could be Aussie negative. But as we can see from this series of highs through here around about 66.30, you could find a few offers through there. And we'll probably continue to range trade between 65 and 66.30.40 on the wide of it. We've also got China CPI and China PPI next week. And if you think that as I do, China is exporting deflation, that could mean that inflationary pressures are likely to remain benign. And consequently, we could well see inflation slowly start to come down. What should I say, continue to come down with over the course of the next couple of months or so. So certainly I think we're going to see rate hike this year. There's just been a little bit of disappointment that the starting date has been pushed out. So let's look at today's payrolls report. So there are a number of factors at play here. We're looking for 185,000 on the headline number. There will also be a whole host of revisions, which we'll probably need to pay close attention to, but we'll probably take a while to shake out. The factors for a strong report, Goldman Sachs is calling for a number of around about 240,000, I think as his city group. And the factors behind that are lower jobless claims. They've been in and around 204,000, been as low as 187,000. So there's certainly no evidence that the US labor market is struggling. Jolt's job openings jumped quite sharply at the end of last year to over 9 million. So again, no evidence that vacancies are diminishing. But on the flip side of that, this week we've had a miss on the ADP report, which was a little bit on the weak side. So that was a little bit disappointing and could well weigh on the headline number. But overall, there is a general consensus. This particular payrolls report, as with all of the others, could go either way. So you've got a consensus of 185, I was listening to Bloomberg this morning and someone was saying that 100,000 number could put the prospect of a March rate cut back on the table. I don't think so. I think if you've got a negative number that could put the prospect of a March rate cut on the table. But I certainly don't think that 100,000 plus 100,000 number would put the prospect of a March rate cut on the table. So there was also poor weather in January, a lot of freezing weather in Texas and the southern states, which could mean that we get a weaker number. But that should correct itself in the February numbers in a month's time. So again, you've got to be a little bit sensitive about that. Unemployment could well age back up from 3.7 to 3.8%. I think one of the things that did surprise me about last month's report was the fact that the unemployment rate dropped so much. But a large part of that was down to a big drop in the participation rate, which to me was rather odd. It dropped from 62.8% to 62.5%. That made absolutely no sense to me. But then you've got a big jump in vacancies from the jolts. So why would people drop out of the workforce? So that could get revised higher in this afternoon's numbers. So that's certainly something to keep an eye on. Also, wages. Wage growth is still fairly resilient. 4.1% in December. No change expected in today's March numbers, in today's January numbers. And on the ADP payrolls report, wage growth was around about 7.2%. So again, there is evidence that inflation is proving to be particularly sticky and particularly services inflation. And actually, if you guys were looking at the ISM manufacturing numbers that came out this week, the prices paid component of that report showed a jump into positive territory, 52.9%. So again there, inflationary pressures do start to be building back up again. Now, whether that's a consequence of the disruption in the Red Sea, that could mean that while inflation is slowing, the process might not be as linear as perhaps central banks would like. And consequently, we could start to see an uptick. Certainly that's what the Bank of England is thinking is going to happen. We'll probably fall back to target in April when the energy price cap comes down. But then they're expecting to see an uptick to 2.75% by the end of this year. So you could see a bit of a rebound. And I think that's why central bankers are being so much more cautious about why they remain reluctant to telegraph with any degree of certainty about the timing of the first rate cut. So as I say, the numbers are as follows, 185 consensus. If we come in particularly low, anything close to 100,000, you might get a little bit of dollar weakness and a little bit of softness in yields. And that could prompt a bit of weakness in dolly yen and for euro dollar to test 109.20, 109.30, and the cable go back to 128. Anything above 200,000 pretty much blows the prospect of a March rate cut further away. It's currently around about 30%. So that could fall further and you could get a little bit of dollar weakness on the back of that. So a wide range of variations, a wide range of outcomes. On the wider scheme of things, I don't think we're going to see anything significant in terms of a move that's going to shift market expectations about a March rate cut. So we're five seconds to go and the numbers are due out now. So let's just wait and see as to what comes out. 353,000 jobs added in June, sorry, in January. I mean, that is just, that is humongous. So let's have a look at the, let's have a look at the other numbers on that. So we've got, I've just lost my screen now, 3.7% on the unemployment rate. So I think we could definitely say boom, because that is an absolute blowout number on the headline. So I think it really matters about the rest of it. 4.5% wages, boom again. And the labor force participation rate unchanged at 62%. Well, I think if anyone was holding a candle for March, I think they're about to be carried out because that is an absolute blowout number shows that the US economy has continued to main resilience and May at the very earliest. I'm looking at the revisions, US payrolls revised higher by an average of 27,000 a month in the second half of 2023. So US economy is going gangbusters. I think even a May rate cut could be a optimistic, shall we say. So that's really dollar positive and that's reflected, I think, what we're seeing with respect to dollar yen and it's certainly being reflected in yields. So you remember when I was saying this is going to move the dial that much? Did anyone have 353,000 on their non-farm payrolls cue card because I certainly didn't. And yeah, markets have now priced out 125 basis points of cuts this year. They've priced out 100 basis points of cuts this year and we're now pricing in fewer than 100 basis points of cuts this year. So the Bloomberg headline is a Fed swaps assign lower rods to March rate cut after the jobs data. Lower rods? Well, yeah, okay. No, yes, no something, something is all I can say to that particular headline number. That is a really solid number. So let's see what that's done to S&P futures. It's knocked it back slightly. You would expect it to have done so. Given the fact that yields have shot up. But you know, is it as bad? Is it as bad as that? Because the US economy is already showing signs that it's not being really affected by elevated levels of interest rates. And ultimately, prospect of a recession is becoming less and less. So it is the fact that the Fed is not going to need to cut rates necessarily a bad thing for equity markets. Because ultimately it will mean that the US economy is in much better shape. Employment levels are higher. The economy appears to be coping with current levels of rates. And consequently, that should mean consumers have more money in their pockets and more money essentially to spend on everyday goods and services. So just because the Fed is not going to be cutting rates in March or May or June, is that necessarily bad for the stock market? Certainly two year yields have continued to blow out. Let's look at the one day chart on this. I think that tells the story all by itself. So we've gone from 422 to 434 in the space of around about five minutes. So that is very much dollar positive. And certainly I think we're going to see a significant test of those support levels that I was talking about in the lead up to those numbers. So we're looking at 125.90 on cable. And we're looking at 107.80 on euro dollar. But certainly I think there's nothing in those numbers to suggest that we should be too concerned about a big, big sell-off in stock markets. Yes, certainly you're seeing a little bit of a pullback on the Nasdaq in the pre-market. And you can see that there. That was quite obvious. But does that mean that meta is not going to open 14 or 15 percent higher when US markets open later today? Does that mean that Amazon won't open higher when US markets open in just under an hour's time? I'm not sure. But I think what it does do is it basically just keeps, it will certainly keep I think the upside fairly limited today heading into the weekend. And the focus will now shift I think to the inflation numbers, the US CPI numbers later this month. I mean I think what was particularly noteworthy was the fact that we saw a big jump in wage growth in those numbers from 4.1 percent to 4.5 percent. I mean that was I think really notable. And December was revised up from 4.1 to 4.3. So that's going to worry the Fed. They're not, they're going to be in less rush to hike rates, hike rates, cut rates than they would have been before today's numbers. So unambiguously, decent set of numbers, and more to the point unambiguously dollar positive in the short to medium term. So let's keep an eye on those key support levels that I talked about earlier. Obviously it's also going to be not particularly good for gold. And gold is taking a little bit of a nosedive. But again here, you know, gold's very much in a range. And we have got a fairly decent trend line support coming in and around through these lows here. If I just stick that one in there, pull that through there. We'll probably go and see gold drift back towards the bottom end of this recent range. But it should stay above $2,000 an ounce in the short to medium term. Quick look at Brent crude. Obviously the strong dollar there is giving crude prices a little bit of a knock lower. And we do appear to have broken out of a little uptrend that we've been in since those lows back in December. So again, that should be reasonably positive for consumer spending and should act as a little bit of a lift when it comes to consumer spending power going forward. Does anyone have any questions on anything that I haven't thus far covered on this particular forum? I'm just trying to find the questions tab. Where are you? There you are. Okay. So based on those blowout numbers, any questions guys? What do I think and cause this rally inequities to run out of steam? Yeah, I mean, that's a really decent question. For me, I think that's a very hard question to answer because I think if you'd asked me a week ago whether or not this rally could continue, it would be something along the lines of the Fed is probably not going to be cutting rates in March. And we saw how explicitly say that it was a very high bar to a rate cut in March and the S&P posted its biggest one day fall in around about six months in September. And yet here we are 48 hours later. And that's that big fall on Wednesday is pretty much ancient history. So I think for me, it's really about not trying to worry about when something's going to run out of steam. It's more a case of follow the trend that's in place at the moment, trade with that until such times as there's evidence that it's coming to an end. And based on everything that I've shown you today with respect to equity markets, US equity markets in particular, we still remain very much in by the dip mode. So I can speculate to my heart's content as to why an equity market rally will run out of steam. But to my mind, it's sort of a distraction to the wider question is, how long is it likely to continue? And for me, this is about momentum. And at the moment, the momentum continues to favor buying the dips. So we've seen a we've seen a big sell off in European markets on the back of those numbers. But US markets have been a little bit weaker. But you wouldn't really know it. It's another arm, the rally that we saw yesterday. So you could argue that European markets haven't yet taken out their previous highs, the CAC 40, the DAX. And if you are looking for a market that might be a little bit toppy, you'd have to look at Europe. But when you look at the downside potential in Europe, the dips haven't been particularly, you know, they've been quite we drifted lower, we rebounded off the 50 day moving average. And then we slowly clawed that back. And now we're back where we were just over two months ago, or just under two months ago. So, you know, for me, I don't think too much about what's going to cause the rally inequities to run out of steam. I just follow what the price action is doing, and then basically trade on the back of that, because that's essentially all you can do. If you worry too much about what might happen, you miss what is happening. And at the moment, what's happening is that markets are generally looking fairly resilient. The data in the US is really strong. In Europe, it's slightly better than expected. Consequently, there's no reason at the moment to suggest that markets are going to fall off a cliff. It's a slightly long winded answer and stuff, but I'm afraid it's the best I can do, I suppose. Has anyone else got any? I mean, I'm hoping that's okay. Any other questions, ladies and gents, on those blowout payroll numbers and what they mean for markets in general? So, we're seeing a little bit of weakness on the back of that, but I would be very surprised if that weakness is in any way prolonged. And at some point, we'll see buyers start to come back in cautiously. So, look at that dolly yen. Again, for you, Joe, yeah, it looks like we're re-testing those peaks again. Really nice, tasty move higher there. So, 148, 2030. That's going to be the next key resistance level there. Being interested in what the Bank of Japan have to say about their own tightening bias, because I think they will tighten at some point this year, bring rates back into positive territory, then minus 0.1, they can't stay there forever. But certainly, I think, in respect of US rate cuts has taken a little bit of a setback today. Not only in March, but May as well. Natural gas, oh, that old favorite. We just love natural gas. Well, it looks a bit bottomy at the moment, but we are now starting to head into very on a seasonal basis. What I would call is a time of probably fairly weak demand as spring starts to come. So, certainly on this basis, I would be cautious about being aggressively long of it. But having said that, we are very close to the December lows. So, I'd be interested to see whether we see a rebound back to around about 240 before we then drift lower again. If we look at where we were a year ago on US natural gas, so we've got February 2024, go back to February 2023, pretty much near the lows. And we spent most of the spring and summer months trading in and around or close to these lows. So, yeah, I mean, I wouldn't expect too much upside in US natural gas at this point in time. Any other questions? So, quickly next week, let me just give you a recap of what's coming up next week. We've got China CPI and PPI. They're both in deflationary territory. So, there's going to be a bit of a deflationary bias coming out of China. Chinese New Year starts on the 10th of Feb. So, we're probably not going to see much in the way of stimulus before the end of Chinese New Year. The triple R cut that was announced by Chinese authorities kicks in on the 5th of February on the Monday, five days before Chinese New Year. We've got services PMIs also on the Monday. Again, economic activity in Spain and Italy has been more resilient than it has been in France and Germany. So, maybe we could see an uptick there. US has proved to be much more resilient as has the UK. So, again, I don't think any of the data that we're going to see out on services next week is going to be particularly conducive to expectations of a rate cut. Could be wrong, but certainly I'll be paying close attention to the European ones because I think the sands are shifting in terms of a timing for an ECB rate cut. Talking in June, but I think we could get one as soon as April. On the earnings front, we've got BP's, fourth quarter numbers and four year numbers. They're due out on the 6th of Feb. It'll be interesting to see whether or not they decide to focus more on oil and natural gas and the big money spinners and start to shift slightly away from their performing oil transforming policy. Got photovoins, Q3 numbers. We've got Unilever's four year numbers and we've also got earnings numbers from Uber, Disney and Arm Holdings. So, again, big week, another big week for earnings. Not as big as the one just gone, but it'll be interesting to see whether or not the real resilience that we've seen carries over into next week. Okay, so in the absence of any other questions, ladies and gents, once again, thank you very much for listening in. It's always been a pleasure. Got my weekly video is available and my weekly head is available on the news and analysis section of the website. Otherwise, thanks very much for listening. Hope you all have a great weekend and see you all in the same time, same place next month. Thanks very much for listening.