 Good afternoon ladies and gentlemen. Welcome to this week's Monday market webinar with me, Michael Houston. I will be your host for the next half an hour in the absence of my colleague Jasper who's decided to go on vacation for a couple of weeks. I've decided to give him a couple of weeks off because he works so hard. So you're stuck with me. Just do a quick risk warning for compliance purposes and then we can look ahead to what's coming up this week, which on the calendar front is actually fairly thin. We certainly don't have anywhere near as much data to get through this week as we did last week. And I think for most of this week, I think the focus is going to be obviously on the ongoing saga of Greece and will they, won't they default? And will they come to an agreement with EU creditors after the decision to delay their Friday payment to the IMF and potentially roll them up all into one payment at the end of the month? Just to clarify, Friday's repayment was 300 million euros. They've got a total of 1.6 billion euros, 1.5 billion euros, which they have to pay by June the 19th. The current bailout extension expires at the end of this month. I'm not hopeful that we will get any sort of agreement between now and then, which for me means the best case scenario really is another extended pretend type of scenario, but that doesn't really resolve Greece's cash flow problems. That being said, markets continue to remain fairly sanguine about a potential Greek default, but I think that is the most likely scenario at the moment. But until it happens, it's very hard to determine one way or another what markets will do when it finally happens. And trust me, it will finally happen at some point. It's just really a matter of timing. So we'll have a look at the bond markets, because the bond markets in particular have been particularly interesting. Those of you who saw my video about a month ago, beginning of May, will know that the reversal that we saw in bonds would appear to suggest that potentially we could well see further downside in bond prices, which would then basically translate into high yields. Certainly if you look at the bond price in the context of where we've come from, we've seen a significant decline. And when I did this video in May about just before the election a month ago, I talked about a bearish engulfing or a key reversal month and suggested that we could be in for a significant correction, not only on the bond, but also on the German DAX as well. And this morning, we have just tipped into correction territory on the German DAX. We can see that on this chart here. This is the ordinary chart that I was looking at as well a couple of months ago. And again, we had a bit of a reversal there. If we actually look at the saved chart that I've done for this, we can actually see the way the price has actually staircase down. We do appear to have made a three month low. We've broken below the may lows, but that still brings us into what I would call a little bit of a window of support between 10,980 and levels pretty much where we are now. Now that doesn't necessarily mean that we can't see further declines, but certainly from what I can see here, the direction of travel does appear to suggest that, potentially, we may have seen a little bit of a top. Certainly, there's potential for a bit of a reversal. You could argue that this is potentially a head and shoulders. You've got the left shoulder here. You've got the head there, and you've got the right shoulder here. It's pretty irregular, which does suggest that any move lower is likely to be susceptible to significant snapbacks. Certainly, if you look at some of the price action over the course of the past few days, we can see quite significant ranges in the context of the overall trading session throughout the day. For example, on Thursday, we got nearly a 300 point range on the German DAX. You certainly don't think we're out of the woods, and we've also seen a bit of a rebound in the euro. We've talked about the rise in bond yields, but we've also seen bond yields and bond yields rise in US treasuries as well. That can be borne out by this chart here, the US 10-year note. We've seen a significant decline through some key support levels over the course of the last six months, which has pushed yields up to around about 2.4%. US 10-year treasuries currently around 2.4%. German bonds currently around about 0.85%. There's still a significant differentiation between the yields that you get for owning a 10-year treasury and a 10-year bond. But it's not just about that, it's also about the direction of travel with respect to the narrowing of the spread between the 10-year US treasury and the German bond. Now we can see here at our peak, if we look at the spread, I'm just going to click on that there so you can all see the chart that I'm looking at. At the peak here, 189 basis points also coincides pretty much more or less with the low in euro-dollar. Give or take, give or take a few days. Let's just look at the daily chart here and we can see that. If we look at the bullish reversal that we've seen on the monthly candle for euro-dollar, that would appear to suggest that potentially we could have seen the lows in the euro. Now the reaction off the lows that we've seen thus far hasn't been what I would call particularly dynamic, but that's not altogether surprising given how big this candle is here. If we look at the low on that candle, it comes in at 105.20 and the high comes in at 112.66. So you've got 700 points to play with there, which is quite an awful lot. Now in May we slipped all the way back to 108.20, which is obviously these lows that we saw over here. But overall, since we posted those lows in March-April, we've also seen the differential between US treasuries and bond yields come in in favour of the euro. So basically the further this chart here comes down here, the more euro-positive it becomes. And this is the chart that I'm paying particular interest in in terms of interest rate expectations. It's not just about whether or not when you see the US Fed raising rates, it's also about interest rate expectations in terms of the European Central Bank. Now no one expects the ECB to raise rates any time soon. It's not about those, it's about the differentials between US treasuries and German bonds. And at the moment, these differentials on trend appear to be coming in in the euro's favour. So I think that will limit any downside in euro-dollar while we're tracking lower on these yield differentials. So while this chart here is pointing lower, and when I go back to my bond chart, there's certainly an awful lot more flexibility in terms of bond prices to fall than there is in US Treasury prices. That's going to help underpin the euro-dollar. Now the key support level on the euro-dollar is this 110-50 level, which I talked about in the webinar on Friday. When those payrolls numbers came out and they were much better than expected, there's no disputing that. They were much better than expected. We saw a significant dollar rally. But while they were the best numbers that we've seen thus far this year, they still weren't anywhere near as good as the numbers that we saw at the end of last year. So the end of last year, if you look here, we've got 423 in November, 329 in December. Since then we've seen 201, 266, 119. That was revised up from 85, 221 and 280. So it's not too shabby, but it also suggests that we're seeing a little bit of a slowdown in terms of jobs growth in the US economy. And when you actually dig down into the jobs data, an awful lot of the jobs that were added were at the lower end of the pay scale. What it also points to is that was probably the best of the economic data that we saw last week in terms of the overall US economy. Manufacturing still remains very weak. The US consumer also remains very reluctant to spend money. And while we did see an increase in average earnings, I think a large part of that was down to the fact that we've seen widespread increases in the minimum wage. And while that helps keep wages up at the lower end, I don't think it actually adds that much to the overall disposable income that US consumers need to go out and hit the shops. And certainly that's one factor that I think that has been weighing down the US economy. The US consumer, despite the fiscal boost of the lower oil price, hasn't been going out and spending money. So we will get on Thursday US retail sales numbers, which should give us a fairly good indication as to whether or not we've seen a significant rebound in US consumer spending, which thus far we haven't seen for the first four or five months of this year. Now US retail sales in April basically came in flat at 0%. US retail sales from May were expecting a rise of 1.2%. That's a significantly punchy number and I'm not sure how economists have arrived at that number. Nonetheless, it's certainly worth bearing in mind that if we do get a significant downward surprise on that, then we could well see a significant undermining of the dollar. And we can certainly see in the context of what we've had so far, retail sales over the course of the last few months, which is in this column here, we saw a 1.1% rise in March, but if you actually look at January and February, it didn't basically offset the declines that we saw in the first two months of the year. In April, thus far we've seen 0%. We are expecting this number later this week. It remains to be seen as to whether or not we will get that number, but thus far US retail sales for this year are actually negative. Certainly if you look at durable goods, they don't paint a particularly pretty picture for US consumer spending. This is core durable goods and it excludes transportation. So white goods, fairly big ticket items, US consumer, we've only seen again one month out of the last six. So that once again points to a very weak US consumer and US consumer spending makes up around about 2 thirds of the US economy. So we really do need a good number here for retail sales to prompt a significant rebound and push through 1.1050 in the euro dollar. So let me just get rid of that and get rid of that and then we can move on. So 1.1050 is this level here in euro dollar. What we need to see is a move back above 1.1220 to retarget the highs that we saw last week around about 1.1380. And obviously the 1.1480 level that we saw in mid-May. So that's the outlook for euro dollar. 1.1050 on the downside, that's the key support level. Certainly if we look at the chart on a slightly longer term basis we can actually draw in a trend line from the lows here which comes in around about 1.0885 or 1.0890. So that's also worth keeping an eye on. And if we actually look at the daily chart we can also see that the two moving averages here on the 50 and the 100 also look to be starting to turn positive. So again that does appear to suggest that potentially we could well have seen a short term base in euro dollar earlier this year. So that's worth keeping an eye on. Again similar sort of story with the pound against the dollar as well. We've got significant support again between the 50 and the 100 day moving averages. We can see that here in this chart here. I put some comments on the chart forum here on the right hand side if you want to have a look at that. As long as we hold above these 50 and 100 day moving averages the recent rebound off the lows continues to remain intact. Let me just remove that trend line there. So again that sort of feeds into the narrative that maybe we've seen the US dollar peak in the short and medium term. And certainly if we look at my dollar index chart we can sort of see that as well. This is a four hour chart that I'm looking at at the moment. I've drawn some Fibonacci retracements off the peaks that we saw in April which is basically when euro dollar bottomed out around about 10450 and then obviously the peaks in the euro dollar around about 1480 and the lows on the dollar index around about 9316. We retraced 61.8 at a little bit of a double top here. We've seen a break lower but we haven't actually broken back within the 9670 level on the dollar index. So again this pretty much ties in roughly around about 110.5, 110.20 on euro dollar. So certainly looking for confirmation of a rebound in the dollar. But while we're below this 9670 level I would expect to see this drift back down and retest the lows that we saw earlier in May. So that again feeds into my weaker dollar narrative. Certainly if you look at the sterling dollar chart again it's a similar sort of story with respect to a slightly bullish candle. It's not as conclusive as the euro dollar monthly candle was and certainly the very long upper and lower shadows do appear to suggest that there is a significant indecision with respect to where we go next. But we certainly got a very nice weekly reversal earlier this year in April which did prompt the move back to around about 158. We are now starting to ratchet back down but overall my key indicator for cable remains these two moving averages here as well as the 150-170 lows that we saw earlier this month. Also feeding in to a slightly firmer euro narrative was a couple of breakouts that I talked about last week in my weekly video which were EuroCanada or EuroCanada even. An inverse head and shoulders on the daily charts. We can see it here, the left shoulder here, the head there, the right shoulder there, slightly irregular and obviously the key resistance that has now become support line at 137.80. We can see that it's broken out quite nicely. We've reversed quite sharply on Friday because of the Canada jobs data as well as the US jobs data and saw a euro dollar pullback quite sharply and that certainly is a concern but I think while we remain above 137.80 the potential for a continued euro gains still remains fairly positive. Furthermore, if we look at the 200-week moving average on EuroCanada we can see that it has acted as support and resistance in fairly equal measure. We've closed above it, a very long shadow there but overall it's still fairly positive and as long as we stay above the 200-week moving average on a weekly basis then there's no reason to suppose we can't continue to push higher, push above this 50-week moving average as long as we stay above the 200-week moving average. It's also a similar sort of story on EuroEM and we can see that from this chart that I've got saved here. Again, this is the daily chart. We've seen a significant rebound from the peaks that we saw in December at 149.80 just below 150 and the lows that we saw in April at 126.10, 126.09. We've broken above the 200-day moving average. We've also broken above the 50% retracement level of the entire down move there and we've been rebuffed by the 61.8% furniture retracement level on the upside. So there's certainly potential here for a bit of a correction back to the 50% level but overall the setup does appear to be fairly constructive. We draw a line through the lows here again. We've got a nice little uptrend which is starting to unfold. The oscillator is starting to look a little bit overstretched on the daily chart which would appear to suggest that maybe we'll probably get a little bit of a drift back down but overall while we remain above the 200-day moving average then I think the bias remains for this particular currency pair to continue to push higher. One other thing that's making me slightly less dollar bullish than everybody else is simply the fact that everyone is thinking the same thing and when everyone starts to think the same thing, that's when I start to get a little bit nervous, a little bit twitchy and start to think for reasons to go the other way. And looking at the price action here, it's making me a little bit cautious with respect to being overly dollar bullish, certainly in respect of euro-dollar and cable. Maybe not so much dolly yen, the fundamentals there are fundamentally going to be positive for the dollar but even there there is some, I think there is potential scope for a little bit of what I would call a little bit of overstretch on the dolly yen. We have posted new peaks above 125-62 and those were the peaks that we last saw at the end of 2002. We can see that there are those twin peaks there in 2002 around about 125-60. We have gone slightly above that today around about 125-80. So we do need to see a significant push higher and we can see that there's pretty much nothing above 125-80 or 125-60 until these 2002 peaks which are around about 135. We can see that there, 134-95. So certainly looking at dolly yen, it is becoming a little bit overstretched but trying to pick the top on that has been a pretty thankless task and I'm not going to try and pick the top on it now. Certainly the next support on the dolly yen is likely to be around about here, those previous peaks that we saw around about 125. So what I would expect to see on the dolly yen is a break below 125 to suggest that we could see a further correction back to 125-60. And that's certainly what I've articulated on the chart forums this morning. So I update the chart forums every day for euro-dollar cable, euro sterling and dolly yen. So generally you'll get a fairly comprehensive snapshot of what I think with respect to those particular currency pairs on a day-to-day basis. As far as the indices are concerned, it's a slightly different story because we've certainly seen a significant correction and the move lower that we've seen in the bunds as well as the German DAX I think has been prompted by the fact that there is a perception that possibly euro-dollar we may have seen the lows. We've already talked about the DAX breaking down. I'm a little bit cautious about getting overly aggressive on further losses on the DAX simply because we're not seeing a significant break lower on the other European indices that we talked about here. Now a few weeks ago I talked about the fact that the DAX broke to the upside when in fact the euro stocks 50 didn't. And that's equally true on the downside. The DAX has broken lower but the euro stocks 50 hasn't. And that for me I think is one of the key levels here around about where we are now. 3,480 coincides with the may lows. We've marginally broken below that but we haven't aggressively broken below it and that makes me a little bit cautious about getting overly bearish on this particular index. I think what's weighing the euro stocks 50 down at the moment is the fact that the catcaron, if we look at it here, is also holding above a fairly key support level at the moment. And that's around about 4,870, just around about 8 points below where we are at the moment. 4874 we can see the lows in March, fairly key support level. Let's draw that in between 4856 so we can see that once again European equity markets, certainly the blue chip ones are at around and close to key support levels. It's a similar sort of story if we also look at the FTSE Mib or the Italian 14. Again, we're still well above a key support level there. So again we have to be a little bit careful about being overly gung-ho about the market trading lower. 22,400 there on the downside is a key support level. Certainly I think what's helping the DAX today is a rebound in Deutsche Bank in the wake of the resignations, the joint resignations of the two CEOs. And we can see here again on the Spanish IBEX that we are also near fairly key support level, albeit in a fairly downward trend. But again we can see potential for a little bit of a head and shoulders formation here, but we'll only get that on a break I think below the 200-day moving average. Though with respect to this 200-day moving average it's fairly flat. So I wouldn't expect to see a big reaction on a break below it. But certainly I think these topping formations do appear to suggest that there's an awful lot of uncertainty in European equity markets at the moment. And I think a large part of that is down to the fact that we're getting a little pickup in inflation repressures. I think the bond market move had got a little bit too one-sided, and we're getting in a little bit of a pullback on prices and a push higher in yields. And that's going to be broadly Euro supportive until or unless we get a conclusion on what's going on in Athens and the Greek data debacle for want of a better word. So let's have a quick look at, now we've looked at European markets in the Euro, let's have a look at the US markets. There's not really much to see here, it's pretty dull. We can certainly see that we continue to trade in a range here. We're probably at the lower end of the recent range. We can certainly draw a line through here on the lows, which suggests that if we get anywhere close to 2070 on the S&P 500, we're likely to see a little bit of a rebound. But certainly I think those payrolls numbers, in addition to the fact that we saw some, I think what you could call fairly dubbish talk from policy makers, Fed policy makers last week, from Charles Evans of the Chicago Fed, from Lail Brainard, who is a permanent voting member of the FOMC, and also James Bullard, who's St. Louis Fed, who has for the most part of this year been calling for a rise in US rates. He's now tempered those calls ever so slightly in light of the weak economic data out of the US. So for someone like Mr. Bullard, who has been calling for rate rises to suddenly row back on that, I think it makes it unlikely that we'll see any move in June. And to be quiet, if any move in June was off the table even before Friday's payrolls numbers, it's way too soon if it's data dependent. And for me, it's really about sequencing. Do we get a rate rise in September? It's unlikely that we're going to get a move on the Fed's inflation forecasts in the June meeting, and it's unlikely that we'll get a move on the Fed's growth forecasts, and both of those were downgraded in March. Now the Fed upgrades its growth in inflation forecasts every quarter. So if they don't do anything in June, and they're not likely to, then the next time they can upgrade their growth in inflation forecasts will be in September. Now I think it's unlikely that they will upgrade their growth in inflation forecasts in September and raise rates. I think it's more likely that if they're going to raise rates this year, they'll move on their growth in inflation forecasts in September, which means that the earliest that they can raise rates is either in October or December. If they don't move on their inflation and growth forecasts in September, then it's hard to see how they can raise rates this year. And that for me I think is really the key factor I think. When people talk about putting a rate rise back on the table in September, I think the Fed would have to signal that they're happy that growth and inflation is starting to move higher. And at the moment there's certainly no evidence of that, despite the fact that average earnings data has aged up ever so slightly. You've also got Chinese data and that continues to disappoint. If you've got China exporting deflation to the rest of the world, it's hard to see how inflation in the US is going to pick up strong with dollar, obviously not withstanding. And a strong currency as we all know is deflationary or disinflationary, whatever you want to call it. So Chinese trade data that we saw earlier this morning was once again disappointing. We saw exports slide further, much more aggressively than we thought that they would do. The import and export data it does make for worrying reading. We saw a 2.4% decline in exports, which was slightly better than we were expecting, but it's still a decline, but imports slid 17.6%. There's even more than in April and it raises concerns that the likelihood is we're going to see further easing by Chinese authorities and it's going to make it that much more difficult for the Chinese to meet their growth target of 7%. For me, if China is exporting deflation and we heard this morning that China is cutting energy prices, it's cutting electricity prices, it's cutting natural gas prices. I tweeted that this morning. That's going to have a deflationary effect and I think it's likely to ripple out through the rest of the world. So again, I think it's going to make it that much more difficult for the Fed to raise rates. Also, the IMF intervention was very unwelcome, I think from the Fed's point of view. Does that mean that they're going to basically raise rates irrespective of what the IMF do? I think again, it's up for debate. The market thinks that the Fed will raise rates this year. I still think it's 50-50 and I'm still inclined to think that they probably won't, but follow the price action and listen less to the headlines and look at the price action. The price action for me does appear to suggest that we could have seen a short-term top in the US dollar. Irrespective of what anyone else says, I always go with the price action. Looking at gold and other precious metals, again, we can see that we're in a range here. It's not really telling us anything we don't already know. We can see that there's significantly a good area of support between 1150 and 1170 and resistance to 1223, 1243. So trade the range on that. It's not really going to offer you too much. Brent Crude, similar sort of story I would suggest that we are on a key support level on this particular chart here. Around about $61 a barrel. We saw it rebound off that line on Friday. And it's also the trend line that I've drawn in from the 2015 lows. But again here we're seeing what I would call lower highs. So I think if we're going to see further gains in the oil price, we really need to get back above the June highs that we saw earlier this month. Around about $65, $66 a barrel. The fact that OPEC left production levels unchanged would appear to suggest that it's unlikely that we're going to see a significant takeoff in the oil price because it is still a supply and demand story and there's still much more supply than there is demand. And as such I think that's going to make it very, very difficult for the oil price to rally significantly aggressively, notwithstanding the fact that I think the rig counts in the US have probably fallen about as far as they can. So in terms of the WTI price, again it's a similar sort of story. We're trading in a broad sideways channel albeit with a slight, very slight negative bias with resistance just above just around $60 a barrel. So certainly can keep an eye on that. That looks fairly bearish there but again I'm not expecting too much in the way of volatility in terms of breaking out either side of this range. You're not expecting that. I think we'll retest potentially the lows that we saw in May. But overall I think the bias is we're going to get into a little bit of a new range with respects to WTI. Let's have a quick look at dollar CAD for all you CAD aficionados over there. We've had a bit of a breakout on this particular chart here. But overall if we look at the, this is a four hour chart. We can see here that we're still in a bit of a downtrend from the March highs. And what we really want to see is a move above the peak that we saw on Friday which is around about $125.60. So that's a big, big level there. I think the key support remains around about $123.50 on the downside. Certainly the oscillator is significantly overbought which would appear to suggest that potentially there's probably more downside than there is upside. Currently where we are now it's in no man's land with respect to the resistance and the support levels. So I'd probably be cautious about getting too involved in that particular currency pair at this point in time. Let's finish up with the Australian dollar. That's been a little bit more difficult to pick over the course of the last few months. I thought this would actually go an awful lot higher. It actually hasn't done that. And the reason I thought that was because it posted a significantly bullish reversal on the monthly candle. But we pretty much given back not all of it but a good portion of it. I think it's significant that we haven't broken below $75.30 and that does bode well for further Aussie gains. But I think it's obviously suffering from a perception that we're seeing a little bit of, we've seen some very disappointing Australian economic data and that's feeding into a narrative of potentially that the RBA could actually cut rates further. I'm still doubtful that they will do that but you never know. And we can see from here, this chart here, that there's pretty solid support just below $76 around about $75.95 and then below that the April lows around about $75.30. Let's have a quick look at the Turkish lira because that's been a bit nasty. Over the course of the last few trading sessions, looking at a weekly chart, we can see that as a result of the Turkish elections, we've had a nice little gap higher. I have to say this is not something that I would still well clear of simply because it's just way too volatile but it certainly makes for an interesting looking chart. And given the way that this has moved, you'd have to think that this gap will probably get filled at some point over the course of the next few days but you're going to need deep pockets to play this particular market. Anyway, that's pretty much it for this week, ladies and gents. Unless you have any questions that you want to address to me right now.