 Good afternoon ladies and gentlemen and welcome to this week's Monday webcast on the 14th of April. I nearly forgot what the day was then. 14th of April 2014 and we've got a fairly big week in terms of economic data coming out this week. It's a shortened week, four days because obviously Easter and Good Friday. So certainly something to bear in mind as we head towards the weekend in that we could well see a significant amount of position adjustment going into Thursday. And we're basically starting off the week pretty much where we finished off last week. Lower on the back of two different factors. Concerns about obviously the spillover effect from the decline that we saw in the US on Friday after the London market closed. London market closed around about 6560. We're now around about 6536. We are off the lows of the day. Obviously concerns about this escalation in Ukraine has also hitting risk appetite on all the European markets this morning, the DAX is lower, the FTSE MIB is lower, the Spain index is lower, the Cadont is lower. And we're approaching a number of key support levels in the Dow, S&P, NASDAQ and the Russell. And in terms of economic data out this week from the US I think there's going to be less focus on that than there is on actually company earnings later this week. We've got Citigroup coming out later today. We've also got Google, Morgan Stanley, Intel, a whole host at Coca-Cola, Johnson & Johnson, a whole host of earnings announcements later this week. And they're likely to have a big bearing on where the S&P, the Dow goes over the course of the next three or four days. We obviously cannot forget that this week we've also got Chinese economic data, Q1 GDP, Chinese industrial production and Chinese retail sales for March. So there once again going to be very, very key in the context of whether or not we see a continued slowdown in the Japanese, the Chinese economy. So Chinese Q1 GDP expectations for that are for a slight softening in the GDP number down from 7.5% to 7.3%. Now obviously if we come in much slower than that and there is a good chance that we could, given the very anemic trade data that we saw last week, then you can expect further speculation about further monetary easing from Chinese authorities. However, I think they're going to remain very, very limited in the context of what they can do. And certainly I think that's borne out by the fact that they trumpeted this minor stimulus announcement a few days ago and really markets haven't reacted that well to it. And I think the most we can see is probably a continuation of the weakening of the one. Let's look at the Chinese RMNIMBY here. And we can see that it's continuing to weaken. And if you look at where it was at the beginning of 2014, it's around about 601. It's now around 621. And I think the Chinese authorities in an attempt to try and make themselves more competitive will basically just continue to let their currency weaken against the dollar. Now the US is not going to be too happy about that but it's not really an awful lot that they can do about it given the fact that they are probably the biggest culprits when it comes to currency debasement out there. So keep an eye on that Chinese RMNIMBY chart. It could certainly give you a good indication as to the direction of travel with respect to the Chinese, the next move on Chinese monetary policy. But let's go back to the Dow Jones, the US 30. We can see straight away here this level of 15,970. It's the March lows. It's pretty much just above the lows for April so far. And it's also the lows that we saw in February on the 20th of February as well. So this is a pretty key level in terms of the recent declines that we've seen in the US 30. Let's look at that as a weekly chart and we can see actually that this is quite a bearish candle here. We've got this long up a shadow here. We weren't able to sustain the gains and we actually closed below the highest close that we saw in February. We've seen a significant decline here, fairly similar to this candle here. So how it reacts in relation to this support level here I think is going to be very, very key in the context of this week's price action. And we can see a similar sort of story also looking at the small cap, the Russell 2000. We're right on the 200-day moving average. We're right on it. And that's going to be, I think, a very, very key level in the short to medium term. And we can see this is the first time we've touched the 200-day moving average since November 2012. So we've been above it a very, very long time. Now you can draw trend lines through these if you so wish. In fact, I'll do that now just to see if there's any sort of indication as to whether or not we've broken a key support. And you could argue that we actually have broken a key support on this trend line from the April lows. So really the next key level remains the 200-day moving average on the small cap 2000. Let's look at the NASDAQ. NASDAQ, similar sort of story. Again, we're on a very, very key support level, which is actually at the lows that we've seen this year and for December last year. So once again, and we've also got the 200-day moving average. So once again, we're approaching some key support levels on a number of key US indices. Let's basically break that up again here. And on a weekly chart, you could actually argue that there's potential there for maybe some form of head and shoulders tops starting to form, which would seem to suggest that maybe we'll get a bounce off this 3425 level. So I certainly think it's worth keeping an eye on that key support level on the NASDAQ as well, especially given the fact that we've got a whole host of important earnings announcements out this week from IBM, from Google and from Intel. Certainly we'll give a good indication as to whether or not there is the momentum there to actually push the market lower. We're going to finish off with the S&P because I think that's quite important. And certainly in the context of the triangle breakout that we talked about last week and in the non-farm payrolls webinar at the beginning of the month, because we did get an initial breakout, then we got the move lower. Now we're outside the triangle here. So the key question now really is, instead of getting the break higher, do we now get the break lower? And we found support around about these November, December highs here, which was around about 18, 13, 18, 15. We're finding a bit of a base there for the time being. What I think we really need to see is for the market to stay below this trend line here. Now this trend line is sloping up. We're going to call that a pullback line. So there is certainly potential for us to come all the way back to around about 1842 or 1850. If we go back inside the triangle, then obviously all bets are off. But certainly in the context of the move that we've seen over the past week or so, it would appear to be the case that maybe momentum has shifted slightly. And also we've got a similar sort of weekly reversal here on the candles as well. We've got a very, what I would call a gravestone type doji chart, or a gravestone type doji. We've got a very strong down move here. And now what we really need to see is a break of this trend line from these lows from the mid-2013 through this level here. And this trend line I think is particularly important. It comes in just below the 1800 level at the moment. So certainly worth keeping an eye on this area between here and here because that could prompt a short-term bounce in the short to medium term. For the time being, we're seeing a little bit of a pullback ahead of the US retail sales numbers that are due out later this afternoon at 130. So that's going to be a key factor in the context of the next move in today's markets when the US opens at 230 this afternoon. Right, so those are the main indexes on the US. Let's now look at the CAC Caron, not the CAC Caron, the UK 100, my mistake. And again, we're approaching the bottom end of the recent range. As you can see from the actual performance so far on European markets, the declines that we've seen have been less aggressive in terms of the overall down moves than US markets. And that's not really altogether surprising. I think that the key thing to keep an eye out for is the fact that the US markets are generally on the way up, have really outperformed European markets. So there's an awful lot more what I would call scope to pull back on US markets than there is for say, for example, the German DAX, the UK 100, the CAC Caron. So I think in the context of the current move that we're seeing in UK markets, what I would like to for you guys to bear in mind is that there's going to be probably going to be a significant amount of support around about the 6,400 level on the UK 100. We can see that on this weekly chart here. There's certainly a significant area of support around the 2014 lows and the lows towards the end of 2013. So certainly worth keeping an eye on that particular level. But at the moment I'm still of the opinion that we're probably in a broad range with respect to the UK 100 and that what US stocks will affect it, but any rebound in US stocks is going to limit the upside in terms of European stocks overall. We can see a simsort story playing out in the German DAX here. Again we're still well above the lows that we saw in February and March and as a result I think that really bears out what I was saying earlier. We are seeing an improvement in economic data out of the UK, out of the EU, though there is I think some evidence that maybe some of that may be starting to plateau slightly. And obviously US data is starting to improve. We can go on and on about the reasons as to why US markets are correcting and I think for me it's all about elevated earnings expectations and the fact is US companies are probably an awful lot more exposed to elevated earnings than say for example European companies which over the past few years have probably found that their upside has been an awful lot more limited in the context of the gains that we've seen in the US markets. So we're mid-range at the moment with respect to the DAX. I expect that to continue. Certainly with respect to some of the talk that's coming out of the ECB at the weekend we heard Mr. Draghi and then we heard another ECB member Bennewit Cool basically start to talk the Euro lower again, talk about some form of QE program by the ECB. So once again the prospect of further stimulus from the ECB I think is helping to keep a little bit of a flaw under European markets but I certainly do not expect to see any form of QE anytime soon. This is another attempt by ECB policy makers to try and talk the Euro lower. To a certain extent it is succeeding, it's slowing the rise of the Euro down but until such times as markets get any sort of semblance that the ECB is willing to act outside just talking the Euro lower then I think any downside in the Euro is likely to remain limited at best. This is really borne out by this chart that I'm going to show you here. If we look at a daily chart for the Euro dollar over the last 12 to 15 months we can see straight away what the direction of travel is with respect to Euro dollar and now we have gaps lower this morning from the Friday close but overall the trend remains up. We're above the trend line support from the 127 80 lows from July and the fact is until such times as we break this up trend then Euro dollar is pretty much a case of by the dips. Certainly there isn't any prospect that I think there isn't any prospect for me for the Euro to come crashing off. We can also look at the Euro dollar and then we can look at the Euro yen and it's fairly similar in the way the chart stacks up. Again this is a daily chart. I've got an Ichimoku cloud chart on here and I've also got a very long term trend line support coming in just below current levels at 140. So 140 that's the lows for the week starting the 24th of March and also last week's lows significant area of support through there. We've got the trend line also coming in from the lows that we saw in March, April last year. So once again Euro yen looks fairly well supported on the bids and until such times as we take out this daily cloud and this trend line support from those lows the likelihood is that once again a possible push higher in Euro yen. So we can certainly see in the context of that particular story that the Euro doesn't look as if it's about to drop anytime soon. This is also borne out in Euro sterling. This chart is dull to be quite honest. I'm not going to make any bones about it. It's in a range and the top of that range is likely to be around about 83 for the time being and it's finding quite a few bids around about 81, 50, 60 and 82. Once again the pound is continuing to remain fairly well supported. On the back of expectations that the Bank of England will probably be raising rates an awful lot sooner than the European Central Bank and it's a big week. It's a big week to the UK and why is it big week to the UK? Because we've got inflation data due out tomorrow and we also have unemployment data due out Wednesday. So from that perspective that data is likely to show, certainly the inflation data is likely to show that prices continue to fall back and if that is the case then it's going to soften the case somewhat for an imminent rate rise from the Bank of England. I'm still of the opinion that we will not see any sort of rate hike before the general election. George Osborne just will not allow Mr. Carney to do it. I know we've got an independent central bank and all that but I just don't think that's in the script before the election and I don't think it will happen and certainly on the basis and the direction of travel of the economic data I think it's probably unlikely. So let's look at the UK data that we've got due out later this week. We've got CPI tomorrow for March and that's expected to drop from 1.8% to 1.6%. RPI on the other hand retail price is 2.5%. So retail prices are continuing to outstrip average earnings growth. However, it's average earnings data out on Wednesday and average earnings is expected to jump from 1.4% to 1.8%. So you're getting the crossover effect of average earnings starting to outstrip inflation and obviously that once again is going to feed into the overall narrative that while the economic recovery continues to gain traction, the need for an interest rate hike is not imminent. Looking at the unemployment data as well, that's expected to come in around about 7.2%. No change is expected there. So once again that should feed into the overall narrative of a slightly softer sterling in the short term as we run into selling interest around about the 82 level on euro sterling and on cable which is here around about 167. Now this is quite an interesting pattern. This is called an evening star pattern. It's a three star pattern Japanese candlesticks. I will probably cover this pattern on Wednesday when I host my forex presentation here in the UK offices starting at 6 o'clock, 5.30, 6 o'clock on Wednesday. I'll talk a little bit about candlestick reversal patterns. This is one of them. It's called an evening star formation. It's generally a reversal pattern and that would seem to suggest that despite the break higher, we weren't able to take out the 168.20 highs here. So we've had a double tap on the top side around about 168.20.25 and there is a good chance that we could come back to this trend line support here around about 165.5 and even potentially to these lows here around about 164.50. But certainly looking at this pattern here, there's a good chance that we could well seen the highs in the short term for the pound against the dollar and we could see a drift lower. Certainly if this economics data comes in as we expect it to and those are the key things to watch out for this week. Obviously UK house prices are also out tomorrow. They're expected to rise 7.4% year on year for the month of February. So once again, certainly keep an eye out for that particular data as well. Moving on to Chinese, obviously we talked about Chinese data. Obviously that's out later this week and that's going to have a significant effect on the Aussie dollar. Now you may have heard me talk about this last week. We've been in an uptrend for quite some time. We talked about the potential of this upside down head and shoulders here and the breakout higher and given the fact that this has unfolded over the past three or four months, there's certainly potential for the Aussie to move higher towards 96, 17, 96, 80 over the next three or four months. But for that to happen, we need to stay above 93 and this does concern me a little bit. We are starting to trade a little bit sideways on the daily charts. However, it doesn't worry me unduly. Yes, the RSI or the slow stochastic is very overbore but that can work its way out over the course of the next few trading sessions. The weekly chart does look very overbore but at the moment on the weekly chart there is currently no sign of trend exhaustion in terms of the candlestick charts. We can see here on these Japanese weekly charts that the closing prices are happening very, very close to the highs and that suggests to me that momentum is still being maintained on the weekly chart. So unless we get a significant drop below this support level here around about 93, then there's a good chance we could actually drift sideways for the next two or three weeks before pushing higher. If we take out 93 then obviously there are concerns that we could actually come back to the 200-day moving average but overall I'm not expecting the Aussie to collapse anytime soon. Now we talked an awful lot a couple of weeks ago about the Dollar Canada and there was a very nice breakout in the Dollar Canada. That was shown by this triangle breakout that I showed you guys last week and we talked about the fact that it could go back to 109 and it did in fact do that last week. It actually overshot, came all the way back to 10860 and that was just simply by measuring this move here down from this move here. Now we've had a bit of a turnaround. Now the key question that really I'm looking at with respect to Dollar CAD is whether or not we continue to go lower or we bounce back and start to head back towards 110 or 111. Well if we look at a daily chart and I'm looking at Japanese candles here we can see that on Thursday we posted a bullish engulfing day which does seem to suggest that maybe we could get a rally back to 110 or even 111 in the short to medium term. What we mustn't do in the context of this pullback is fall back below the lows of Friday. Loads of Friday were 109.15 so while we're above 109.15 then the prospects of a return back to these highs around about 110.50 or 111. The bias I think has changed somewhat on the Dollar Canada and we could actually get a bounce back and a move back towards 110 or 111 away from the lows that we saw in the middle of last week. This is how using candlestick analysis in conjunction with pattern recognition can actually work quite well in identifying turning points in market moves. If we draw this for our chart actually what I can do is draw a little bit of a trend line on here to see whether or not I can get any indication as to whether there's an intersection point here and we've got this uptrend from the lows last week. It currently comes in around about 109.50, 109.60 so certainly keeping an eye on that particular move there but we can actually come all the way back to this 109.40 level which coincides with a series of peaks through here without undermining the overall upward scenario in this current rebound. While I'm on here guys, is there anything that I haven't covered thus far that you would like me to cover in the next 5 or 10 minutes? Otherwise I'm going to move on to gold because certainly we've seen a significant bounce back in the gold price despite the fact that we broke the uptrend a few weeks ago. I think certainly in the context of this current move there's certainly potential for further upside. As I said last week I think we had this golden cross on the daily charts which is generally positive for gold prices. If you look at the number of golden crosses on the daily charts you can certainly argue a case over the last 10 years the golden cross has usually been a preemptor to a rally in the gold price and I certainly think there's potential for us to move back to the march highs around about $13.90. What we mustn't do is fall below the 200 day moving average here which is around about $13.00, $12.98, $13.00. So keep an eye on that. At the moment it's around about $13.22. It's probably not in a place where I'd want to really do anything too much with it but I certainly think the bias has changed a little bit from the downtrend that we've been talking about for such a long time in gold to a more by the dips mode irrespective of what you think about the Fed's future policy on stimulus reduction. I still think that there's still steady demand for gold prices at lower levels and I think it's going to make it very unlikely that the gold price will fall back towards the lows that we saw at the beginning or the end of last year. WTI, let's look at WTI. Again that continues to find support at progressively higher levels. Now there's a couple of reasons why that might happen. The expectation improved economic data as the U.S. economy warms up from the chill that's basically enveloped it over the last three months but if we look at these daily candles here, the thing that worries me about this is these very long shadows on the candles of the last two or three days. It's just to me that there's a significant amount of selling pressure anywhere close to 105. So we've been in this uptrend since the March lows, actually the lows so far this year and thus far we've seen no evidence whatsoever that the oil price is showing any signs of weakness but I still remain of the opinion that upside is likely to remain fairly limited simply because of the supply demand differential. You can talk about lower demand on the back of a thawing of the chill effects of winter. You can talk about pickup and demand because the economic data is starting to improve. The two generally tend to net each other off. There was a build last week in inventories which does seem to suggest that supply is fairly plentiful and as such I think while we're below these highs here around about 105, I think the risk is more to the downside than to the upside. So I certainly wouldn't be looking, I would certainly be looking for a bit of a pullback in the oil price back towards this trend line around about 102, 101 over the course of the next few trading sessions in terms of WTI. Brent is a slightly different story. We've heard an awful lot of chatter about geopolitical concerns with respect to Brent and certainly what's happening in the Ukraine has given that a slightly big bias today but overall if we look at this chart here you can see that there's a bit of a barrier between 108 and 109 has been for the past month and I think that's likely to remain the case for the course of the next few trading sessions as well. I certainly don't think there's any significant reason why oil prices and Brent oil prices in particular should take out the highs that we've seen over the course of the last three or four weeks. Now this week we've got some very important data out of the EU. It's CPI data and it's a very interesting argument. Is there deflation in the Euro area? And certainly one that's going to be mulling, people are going to be mulling over for quite some time. Will the ECB do QE? Is there an inflation threat? On Wednesday we've got the latest CPI data out of the EU and that's expected to come in around about 0.5%. Here's the thing though. ECB policy makers have been saying that there's no deflationary threat in the Euro area. That's simply because a lot of the adjustment that's going on in these European economies is largely as a result of drilling down of unit labour costs, reducing the cost of labour and that's pushing prices down in the short to medium term. But what about commodity prices? What have commodity prices done over the last three months? Well, they've actually gone up. If we look at corn prices, let's look at this chart here. We can see since the beginning of 2014, corn prices have gone up from $404 to $5. So that's up nearly 25% in the course of the last three months. Okay, they are lower from where they were just over a year ago and certainly that is going to weigh down on prices on the yearly measure but certainly on the monthly measures, inflation in not only in Europe but also in the UK is likely to feed through in the context of higher commodity prices. Let's look at coffee and this is something that I've been looking at over the course of the past few months. We're not seeing it in the numbers at the moment but the question is when will we start to see it in the numbers? If we look at Arabic coffee, it's jumped from $100 here and it's gone up to $200. So it's doubled. It's doubled in price in the course of the last six months. So again, when does that feed through the supply chain into prices in the shops? Now, there is some evidence that maybe we've seen a bit of a reversal here on the daily chart and maybe we're going to drift back lower to around about $165 or $170. Certainly there does appear to be a bit of a cap between $200 and $210 as borne out by this chart here. So let's draw this support and resistance line in here. Commodity prices are always a bit dangerous and volatile so I'm always a bit cautious about showing these on the charts but I mean this is quite a nice little top in place here. So certainly the potential upside is limited by this resistance and there's a good chance we could get a drift back lower here. It's a similar sort of story if you look at soybeans as well. Again, you've got a bit of a rise in commodity prices there. We've gone from $13,000, $12,000, $50,000 up to $15,000. So you're going to have to ask yourself, I'm certainly asking myself, looking at wheat prices as well. We've seen a significant rally in wheat prices as well. So a large part of that is probably down to what's been going on in the Ukraine because Ukraine used to, I don't know whether it still does, don't know what's happened to the wheat and corn. It's the bread basket of Europe. They call it the bread basket of Europe. So I think the expectation is that we could get a little bit of price inflation start to permeate into the supply chain. It does appear to suggest here that we're getting a bit of a resistance around about $690 judging by that candle there. So again, certainly keeping an eye on commodity prices in the short to medium term. And we've also seen a bit of a rebound in sugar prices as well over the past three to four months. 2014 lows, we've gone from $400 to $480. So again, it's a significant rally in prices here. The key question now with respect to this is have we seen the highs and is the sugar price going to start drifting lower? So it's certainly worth keeping an eye on commodity prices over the course of the next few trading sessions because I think there is potential for maybe price pressures to start edging higher again. Okay, so we're running up to $1247. Going to wind it up, been up for 30, 30 odd minutes now. Unless anyone has any questions, this is going to go up on YouTube. So if anyone wants to listen to it back, it'll be up within the next 24 hours. If you want to sign up to the Forex presentation on Wednesday evening, just go to the education section of the website and come up. Be more than happy to meet you. There will be refreshments and all of that sort of thing on Wednesday. As I say, it starts after 5.30. It'll be for an hour and a half and I'll take you through some of the key things that I look at when I'm making trading decisions on the foreign exchange markets.