 Hello and welcome to CMC Markets on Friday the 29th of March and this quick look at the week ahead beginning the 1st of April and today was supposed to be the day that the UK left the European Union but as we all know that date has been postponed to the 12th of April in the interim but overall it's been a fairly decent quarter for European equity markets and global markets in general and certainly been a welcome respite after the large downdraft that we saw at the end of Q4. There is a word of warning to that we haven't as yet been unable to unwind all of those losses and there is some evidence that equity markets are starting to run out of a little bit of steam. If we look at the S&P 500 if we look at the German DAX we can still see that there is some evidence that we could well be due for a little bit of consolidation as we head into Q2. So let's look at some of the key levels for the key indices as we look ahead to Q2 and the upcoming week of the 1st of April. Currently with the German DAX we remain below the 200 day moving average. We posted in the middle of March a bearish reversal on the daily charts we have tested to support the 50 day moving average. We are starting to edge higher and there is some evidence that we could look to retest the 200 day moving average and that remains I think for me on the DAX a very key level going forward and a key arbiter of future direction. If we then cast our attention to the S&P 500 we can see that on the daily charts here we've posted a very big daily reversal but we haven't really pushed significantly below that 2780 level which has been the lows of the past week or so. So for me I think on on the S&P 2780 remains the key level as well as obviously the peaks that we saw in the middle of March in and around the 2860 level on the top side. What has been particularly interesting and something that I'm paying particular attention to is the tech stocks and the NASDAQ 100 in particular because we posted a very strong key day reversal on the daily charts there and if we actually look at the weekly chart there is potentially a gravestone doji or shooting star on the weekly and we do appear to be looking to roll over so I think how the NASDAQ reacts below 7500 is likely to be a key arbiter in terms of the tech sector as we head in to April and we head into Q2. On the plus side there does seem to be some evidence of a potential golden cross where the 50 day moving average crosses above the 200 day moving average on the NASDAQ 100 and the S&P 500. So we've got conflicting signals playing out on US equity so some caution I think is warranted on these but certainly in terms of the daily indicators while we're below the recent highs on the NASDAQ and the S&P then the bias I think is probably towards sell the rally in the short term until such times as we break above those highs. If we look at the UK 100 the FTSE 100 again here posted a very strong down move in the middle of in the middle of March we have started to claw back some of those and we remain very much in an uptrend but again the 50 day moving average is starting to turn towards 200 day moving average so there is some evidence that we could be seeing a turnaround in sentiment but we really need to see evidence of a move through the previous highs for the for the for the turnaround that we've seen in Q1 to start to gain some traction as we head in to Q2. We've also seen some decent rebound in bond markets as well yields have fallen quite sharply so in that context if yields continue to fall then stock markets are likely to reap the benefits of a fall in yields probably less obvious in US markets where bond yields are much much higher in and around two and a half percent less so in European markets where German 10-year bond yields are now in negative territory so certainly in terms of asset flow and asset allocation there could be some divergence between what US markets are doing and what European markets are doing so let's look ahead to the week coming up and we've got a plethora of data coming out and we've got non-farm payrolls at the back end of the week and in terms of the headline number the February payrolls report was as bad as the January number was good again of 20,000 new jobs missed expectations by a huge amount when compared to the 311,000 new jobs that we saw in January however I think it's hard to really read too much into one month's numbers given the government shut down that we saw at the beginning of the year and just because we got a low headline number doesn't necessarily mean that the US economy is slowing down it could just mean that the US labor market is tight because certainly if you look at the wages numbers they've continued to edge higher 3.4% the highest in 10 years that's been reflected in the performance of the dollar index despite the decline in US yields that is still in the range the key level on the dollar index remains around about 97, 18, 98 so any move towards those upper echelons could well act as a floor in euro dollar and could well act as a floor in dollar yen as well so keeping on that we've also got the prospect of yet more Brexit votes as I speak there's potentially another meaningful vote going through the House of Commons that's likely to go the same way as the previous two but as I speak that is by no means certain but certainly I think if the DUP are unable to come on board that it's unlikely that will get through which is likely to mean that will we see more indicative votes in the coming week as the binary nature of the UK Parliament's decision to whether or not either go with a no deal or revoke article 50 comes into sharper focus that is certainly weighing on the pound against the dollar we can see here that it's heading back to very key support in and around the 250 day moving averages a concerted move below 129.80 could well signal a final topping pattern in place for the cable and precipitate a broader lower down move towards 127.80 on the flip side of that though a lot of this is a little bit of a dollar move because Euro dollar is also looking similarly weak which means that if we get a break below 111.80 111.70 then we could well see further declines towards the 110 level in Euro dollar as well so I'll be paying particular attention to those key levels on the downside in Euro dollar and cable we've also got a host of global manufacturing and services PMI numbers out on the 1st of April for manufacturing for services PMI's on the 3rd of April and I'll be paying particular attention to the manufacturing numbers in light of those really shocking German PMI's that we saw flash PMI's that we saw out at the end of March which saw German manufacturing PMI's fall to the lowest levels since 2016 around about 44.7 with Chinese with Chinese economic activity also muted due to Chinese New Year I think in terms of expectations management there is a risk that actually we could see a surprise to the upside but ultimately these numbers are not likely to remain particularly positive when set against a backdrop of a weak manufacturing outlook. Services PMI's I look to be slightly more positive if you actually look at the economies and split them out on a sector by sector basis I think in terms of services services actually looks in slightly better shape so you could actually look for silver linings there we've also got Canada payrolls and we've also got an RBA rate meeting as well and certainly I think in terms of the recent meetings that we've seen from central banks in general there has been a significant shift to the dovish side the slowdown in China does appear to be having a significantly negative spillover into the Australian economy a slide in Sydney house prices which have dropped over 13% from their recent peers from the recent peaks does appear to be knocking consumer confidence so the big level on the Aussie dollar is around about 70 cents will be keeping a significant eye out on that but certainly in terms of the lower highs the direction of travel does appear to suggest we could see a lower Aussie over time looking at dollar CAD Canada payrolls we've seen a weak Canadian dollar over the course of the last few weeks and if that continues we could well see a retest of 135.05 from the current levels of around about 134 so that's it for this week once again thank you very much for listening to Michael Houston talking to you from CMC Markets