 Okay, very good morning to you. It is Thursday the 18th of February. It's 10 to 7 a.m. In the morning So just going into the the full European open and having a review of some of the news flow and charts this morning Overall, I would say relatively quiet in terms of overall market direction this morning So things were relatively neutral gonna update you on what was said in the FMC minutes last night There's obviously more updates on the weather system is impacting North America at the moment and the impact on energy prices Have a look at some BOE comments and then talk about the day ahead We've got things like ECB minutes jobless claims a couple of central bank speakers as well on the docket Don't forget if you're watching this on YouTube Really appreciates it if you could like and subscribe to the channel if you don't already do so videos coming pretty much every day of the week But remember that you're seeing the morning market briefings delayed And just to check out amplify live comm if you want to get those early But yeah, let's start with the charts and have a look at a couple of different ones I want to look at the euro pound and then cycle through a few of the different asset classes from a technical perspective and then I'll have a look at some of the major headlines in play this morning And one of the first things to start off with is here. This is a look at that familiar Dollar index trend line of which we were looking at yesterday of which we have now Broken out and confirmed the move through that Yesterday's session was here Quite an interesting point of where we trade now in the Dixie at 91 As you can see here from the dotted kind of horizontal line If I just make this a little bit more zoomed in to the current price action You can see here. We had these previous tests Going back to just before Christmas And then also in the new year and kind of mid-January and again Around late January and that's around where we're trading at the moment So for now the dollar index is pretty flat actually from the intraday perspective at the european open today However, it's holding on to some of those recent gains with this ongoing Kind of reflation trade that's being observed across other assets Worth noting though that yesterday Tea notes did move off their lows and yields backed off a little bit Given some that fairly aggressive move that we saw on Tuesday's us return to markets after the prison stay holiday on Monday But the dollar remains firm irrespective of some of that yield pullback And so that's still warrants watching and again having confirmed the break above the trend line yesterday Now just around this key error of 91 is going to be quite interesting any further Move above there could well just continue this trend of dollar strength And so it's probably prudent to have a review of the major currency pairs And this is that look at euro and just the level i'm watching this morning If I just kind of put my chart a little bit more Squeezed so you can see everything and it's really this area looking in the euro future around 120 55 and a half which was the overnight Asia pacific high of the range That was also the low and highs that we were seeing back on kind of the eighth and ninth of the month was also an area With some respect as well technically back at the beginning of february So quite interesting to see if that level can hold Certainly as well if the dollar strength continues And we've obviously seen this pretty definitive trend in place since the commencement of this week's trade We interested to see if we start getting down to that low we had on the eighth, which was the Low that we printed in yesterday's session, which would come in around that one 2029 level to watch today So it's a strong area of upside resistance there to watch in cable This is what i'm looking at this morning, which is A few trend lines roughly in play here We broke below what was quite a nice area that was holding yesterday as as support but now is broken So which was here, which is around 138 63 you can see Held the kind of cap market price We broke above it quite aggressively going into trade at the end of last week We came back to test that around kind of this time yesterday the overnight previous Asia pac session But broke above or broke below that yesterday afternoon And now we're trading below that level I just want to see how we've respected the trend line this morning Early doors, but if we come back down any break of that be looking down for a quite a quick run down to this kind of area here Which is around 138 3127 that would encapsulate yesterday's intraday session low with ds1 on the daily pivots Anything a little more heavier than that and as I said if you see the continuation of that overall dollar Stronger theme then you've got 138 lower The s2 just below at 91 and then probably the target would be 137 76 Which should be down at the low that we saw at the back end of last week Any further upside recovery? Um on the opposite side then 138 63 Would be looking at here as an area of resistance with that descending trend line and that previous area of some significance And you've got the pivot sat just above that as 68 Which could act as a kind of zone of resistance for the moment as far as the currency markets as I say There's no real tangible news flow that really gives me any definitive new view on some of these currency moves So at the moment, I think I prefer to just follow the trend Which is the dollar is holding on to gains. So I prefer just keeping an eye on those downside technical levels as Reference points of where the market might respond to if we continue to downward trend in those current major currency pairs Um, just a quick look elsewhere Um, as far as gold is concerned That's been a very volatile one of late and obviously under some quite heavy downside pressure as to trend given the pickup in yields and the whole View about the economic kind of story going in the months ahead This is a look on a 30 minute chart. So just zooming in on some of the recent price action Again gold quite technical and momentum based when it trades as I'm sure some of you guys are more than familiar with And so on the upside the areas I'd be keeping an eye on as Key areas to to watch on any reversal just to reclaim back some of the aggressive nature of the sell-off that we've had Which is around The best part of 50 bucks through the the beginning of this week So I don't think it would be too unsurprising to see maybe a little bit of a push back up If we are indeed to push down lower. So on the on the kind of more Under the microscope of the intraday market. I'd be keeping an eye on 17 84 and a half Which as you can see by this first rectangle That was the previous support broke market trading heavy came back up to test to the tick on a couple of prior occasions here In the last 24 hours. So I think that's quite a key area to watch Anything above that if we did break above I'd look at then 17 93 in the futures just encapsulating some of the previous highs that were holding back on monday's session On the daily chart if we do remain heavy though, there is obviously a very important long-term Level of support here that definitely needs watching and that's around that 17 62 A few people are eyeing that yesterday because things were looking quite heavy again As you can see yesterday saw the confirmation of the break that we had on the 4th of february That just kind of added to the weight in combination with the dollar strength To the downward trend we've had in gold which has dropped very rapidly from north of the 1800 dollar mark And so that's key area of course the 30th of november low print was 17 62 And that starts to then play into some of the previous price action We were seeing really towards the spring of last year and obviously these mark the initial highs that we had On some of the initial volatility on the outbreak of the pandemic before then we sort of shot up north of 2000 so On the intraday as I said Upside levels keep an eye here and then the downside kind of any retest down at 17 70 Which was the floor largely for the price activity Yesterday afternoon if that comes under pressure then at 62 is going to be obviously very key below 64 is actually the s1 today as well in the daily pivots Otherwise t-notes. I did mention t-notes We did see a bit of a bounce yesterday after on the daily chart You know, this is what we're looking at here on the daily, which is encapsulating really the pandemic So this is 2020 if I just put a marker here so you can see Since the onset of 2020 this is obviously the big surge we had with the plummet In yields after the Fed through everything in the kitchen sink in policy terms to try and support the market and Now we've broken through some very key levels There was the initial kind of area here that was very important on the initial break that we had Um on the 6th of January you remember quite clearly the trigger point here on this yield move was the georgia senate switch meaning that a full blue control of congress And that resulting in the kind of belief of the reflation trade at its initial phase on the bite and stimulus Having more hopes of being more powerful on the fiscal side To really fire up the economy and that saw a yields move We've then had a bit of reprieve thereafter and before this latest kind of Breakout that we've had which again the short term was a break from the beginning of this month And prices and yields have continued to shoot higher here. So Definitely on the on the higher time frame It's like this is the underpinning the reason why people are a bit yield focused at the moment There's a lot of people saying well If this yield environment continues with the threat of even albeit temporary inflation as some would see it But with stimulus coming In the future then it does that high yield environment playing negatively for the equity market There's an interesting article talking about that in the ft this morning that I shared off the amphi live twitter account Forget the chance to read the kind of removal of lower rates essentially which has been a key component obviously to help Elevate equities on this on this kind of record tear that we've been seeing So on the on the shorter time frame This this area here I think on the upside could be quite interesting to watch If we were to see a continuation of the general trend we had yesterday So this is going back to uh last week And you've got kind of as I know it's broken out here But a trend channel with that upside support resistance level to 136 0 2 you've got the r1 above at 0 3 I think that's a pretty strong area of resistance for price on the intraday And on any downward test I'd be looking down at the trend line and the pivot level If we're going to remain heavy once again But fairly light today in terms of the economic calendar in the states not too much coming out jobless claims is the early real feature so I'm not sure we're going to see any dramatic moves in the in the 10-year market Not unless there's something unexpected that develops And then this is just a quick look at the oil market and obviously it's been Quite the move that we've seen materialized. So here let me just squeeze it into shot We're looking at really the last two weeks worth of price action Really dramatic move that we saw at the end of last week We gapped up and then we've remained pretty well supported in price And in fact a decent acceleration last night Seeing overnight in the Asia pack session a high at 62 29 Now on the daily chart what the 62 29 really looked like well Here it is on the daily You've got to go all the way back to really some key areas that I'd be looking at here on the upside Would be around here on the much more higher time frames. This is over a two-year period 63 40 encapsulates The high we had in sep 19 and you'll remember this pop in price with the record high gap in prices That was when we had the Saudi drone strike That caused that dramatic leap in prices over that weekend and the recommencement of electronic trade So that high is not not actually that far off on the daily At 63 40 early around a dollar above the the current Intrally highs that was seen overnight in Asia and then 65 symbolically and also the high from jam 2020 pre epidemic pandemic Would be above But on the shorter time frame any now we've kind of shot up and accelerated in price quite quickly in oil 61 31 I'd be looking at these areas of kind of to watch for on any pullbacks 61 dollars flat Which is also the daily pivot and then lower down And on the s1 in this previous area around 60 24 Would be the things that i'm looking for now Let's talk about a couple of news stories one of those will encompass the api inventories as well as the weather situation in north america, but let me just kick things off with the FMC minutes and Yeah, as i've just looked at the charts you can see this come out came out seven o'clock last night No real definitive market move so nothing unexpected to give you a summary of what the minutes said Officials did not see the conditions for reducing their massive asset purchase program being met for quote some time At their January meeting And again, this was quite a focus given the fact that any conversation Alluding to the idea of even having the discussion about tapering Could have been something that could have upset Markets in a way that perhaps then accelerate the kind of any weakness that's been seen in equities on this higher yield idea about Not just fiscal policy force coming but also the Kind of softening up if you like and retightening of some of the loose monetary policy environment So that didn't materialize but i'd say that's pretty much expected on the inflation side That's the other key thing that people are looking at so really federal reserve policies defined by two things at the moment That the idea of tapering and is bomb buying When is that are we going to get to the point of talking about tapering? And then secondly, what's the View on inflation? How high might it get once the economy reopens and we start to see some quite Barely aggressive demand in the short term and how might the federal reserve respond? And what the minutes said was a jump in some prices is expected this spring With quote many participants stressed the importance of distinguishing though between such one time changes in relative prices And changes in the underlying trend for inflation. So again The fed kind of Maintaining in the minutes that kind of dovish stance I'd say largely a reiteration of what pow and his some of his colleagues have said that you know Despite some of the recent market movement we've seen across assets Which might constitute if was more long lasting some kind of tweak in fed language. We're not there as yet So overall, I would say pretty much as expected member powers to deliver his semi annual testimony next week And he's probably largely expectations are going to reiterate this more Kind of dovish or commentative stance for the time being at least Otherwise the other things we're we're looking at and and definitely a big talking point in states is You can't get away from it because you're probably feeling it if you're watching this in america Which is the temperature at the moment More than four million pounds a day of output almost 40 percent Of crude production is now offline according to various different traders and executives Traders and consultants expect a hit to u.s production that will last between two to three days And is looking unlikely that things will start to recover much before the weekend So a key point here is it's obviously had a an impact on price given the dramatic and pretty quick um Kind of result in if you like of the amount of volume of production being taken offline However, looking at forward-looking temperature forecasts We could see then things start to thaw slightly allowing some return of output The key question is how quickly can that happen? Temperatures in the midland the de facto capital of shale production in america will reach 45 fahrenheit So that's about seven degrees celcius if you're based here in london That will rise to 56 fahrenheit on saturday, which could allow then crude production to to see some first signs of restarting again 56 fahrenheit. I think we got down to like Single digits on monday So quite a dramatic pickup in more warmer temperatures coming and hence that's what's giving us this kind of reference point of Until the weekend when things start might start to normalize and the key for crude traders I guess going forward will be the movement of that timeline How quickly can they get back to some degree of normality? But you know quite a severe Shock here to the system and hence the reason why oil has briefly traded above 62 in the futures market um Couple of things to be aware of city group They've said on the situation expects a production loss of about 16 million barrels through early march But some trader estimates are now almost double that You know, I know that opec have come out and said look we did that That one million additional move when we did the opec plus deal At the beginning of the year and we're gonna we're gonna take that back and start pumping some more again But if you think about it a million here a million there from Saudi We're talking about The potential for four million barrels a day of output being impacted by this energy situation So again, it's about an order Of priority at the moment this energy situation far outweighs in the Intra day period of the coming days and probably into the beginning of next week much more so than any impending opec Conversation or situation that they might do remember opec are not really going to be changing their their current output strategy Until we start getting into april given they're pretty fixed at the moment for their January decisions for what production rates will be during January February and march Okay, the other thing we've had overnight is you did have any energy space the latest api oil and trees As I said just given him the Importance of what's happening and the large-scale impact as a as a consequence of the weather system in America Oil infantry is a really a side point, but it's just so you're aware The headline crude number was a drawdown of 5.8 million expectations for a draw of 2.15 Cushing draw three million gasoline on the flip though was a bill of 3.9 million As I said, I don't think really these are too much of consideration Given the context of what's going on at the moment. And then the final thing I wanted to mention was the bank of england And this idea of negative rates. I think has been put to bed for now at least I think that the vaccination program and the speed of which that has been deployed Has been what's helped in say the forex market reflect the relative divergence between the pound being somewhat cushion comparative to A more weakening euro narrative That's been happening of late But we've had some comments out of the deputy governor So not just a normal mpc member the deputy governor And there's two of them do tend to be aligned with the governor and the more kind of neutral kind of main stance of the bank and Rams then said the central bank could review some of its own constraints on purchasing uk government bonds In financial markets to boost qe While the bank of england doesn't rule out negative rates He said qe is a tried and tested tool and in combination of the speedy vaccination program for me I think the negative rate idea has been eliminated for now. So Could it be used? Yes, will it be used? No, it would be my view at this present point in time So I don't think that's particularly important for market price of your training sterling today But again, it's the kind of negative Rate talk in the uk has come and gone. I think it's definitely being where you push down the line And the idea being here that their more favorite tool is qe Increasing qe tweaking qe in terms of its constraints and what it can purchase Gives greater flexibility for still using that before you'd ever entertain using The next kind of available tool which being negative rates Looking at the day ahead I'm not going to mention really osi data too much Because it hasn't really impacted markets at all. The osi is not really held anything in terms of that move I'd say dollar implications for any of these currency pairs is much more important But as a reference point unemployment rate in australia 6.4 percent against expected 6.5 ECB minutes then coming out at 12 30 london time I don't really see too much in the way of real market ration to that Something to be aware of though and just keep a half an ear out or an eye on the the news feed And then weekly jobless claims Expensive to 765 000 that's pretty much just a continuation of the rough Kind of level of which claims have been tracking at So again, I don't really see in itself. It's going to set the world on fire. However Again, as we've looked at some of these charts if we start to see I don't know a particularly low jobless number for example Could it act as a catalyst just to perhaps break the dollar? Pairs out of some recent ranges and if we get an extension further confirmation following some of the Strong data of late out of the us. It just helps in a short term provide more case for a firmer dollar And that could put some of those downside pressures and those currency pairs under a bit of pressure Perhaps equally so in the equity market because it will fuel it will fan the flames of this idea Of what's really depressed equities of late, which is really great data starts to make people a little bit Apprehensive about does the us need this kind of huge stimulus and will politicians then negotiate that down to a smaller size Which is negative for equities In combination with this whole kind of world of fed star Kind of talking a little bit more less dovishly going forward, which again is also equity negative Otherwise in the afternoon you've got Philly fed coming out eurozone consumer confidence to flash reading But that rarely moves markets and then you've got the oil inventories They'll be at 4 p.m. Not 3 30 only to the u.s. Holiday on Monday And then speaker wise few things look out for Bank of England Saunders At 11 and then feds brainard bostic both voting members at 1 and 3 p.m. Respectively London time All right, that's it. Gonna leave it there Let you guys get on with the day Any questions at all? Just let me know in the discord room if you're watching this on youtube Just drop a comment. I'll be happy to get back to you. All right. Have a good day