 Okay, very good morning to you. It's Anthony Chung here from Amplify Trading. It is Wednesday the 22nd of July First of all, don't forget to like and subscribe to our YouTube channel for fresh daily content from me and other members of the team but having a look then at what have we got in store for the session ahead and first of all before I get into some of These news headlines. Let's just have a look at the overall charts and what's happening this morning and you know Really big day in the markets and last day or so some real key long-standing technical breaches that we've had in the oil market extensions in the gold and silver market the euro also breaking out in the back of the European recovery fund agreement that we saw yesterday and equities NASDAQ record high obviously pulled back a little bit yesterday But still somewhat elevated and they're very close proximity to those all-time highs still within touching distance So a lot of positives to talk about but also a few negatives fundamentally for sterling a few things I want to cover and also When everyone starts to get ultra bullish does start to make me feel a little bit apprehensive and slightly nervous Always normally the tipping point is when everyone becomes a perma ball is when the markets tend to then See a bit of a correction So there's definitely a few things on the covid front that I want to just Make who you guys are aware and keep in the back of your mind that this is Yes, not a focal point definitively driving price action right now amid all the positivity But look it definitely does warrant watching Overlaid as well with a few of these things about the next relief bill that needs to be passed in America to offset The expiration of some of those programs Definitely is a few risks on the table Then we've got corporate earnings tesla And microsoft two of the biggest ones. We're going to have a talk about those as well So looking at the charts this morning a quick run through Of a few of them and starting off with the euro as we did yesterday and yeah really solid breakout of What was containing some of the upside price activity Throughout the last real two days and yesterday Just exploding through that in the afternoon on the confirmation and of a lot of what we were seeing From the post recovery fund agreement and on the weekly candlesticks to put in again the context of that bigger picture You know not just confirmation now of the trend line break in the previous area of resistance Around 113 kind of 80 to 114 24 area in the euro future. We're now smashed through those early Year-to-date highs and we're now trading the highest level here in the euro since going all the way back really till latter part 2018 targeting now up at around the 116 handle so alex i know on the team It's always been very bullish in this setup He's actually looking for a much more progressive move all the way up to award that High that we were trading in the summer really of 2018, which would be an excessive 118 And a couple things definitely to talk about here while i'm on the euro That that might validate what he's saying and Few of these things are looking at the first headlines a threat to the dollar's global supremacy revived by the eu stimulus deal now one of the things here was talking about this recovery fund that europe has put into place And then how it will facilitate Diversification out of the u.s. Dollar by offering a liquid high rating euro denominated debt So remember now this is a collective united kind of european front and so Higher quality debt offered on a euro denominated level Is going to be a major competition than the u.s. Debt in that respect and if the cash starts flying into europe Not into the u.s. That's going to be to the benefit of the euro currency to the disbenefit of the green bank now one of the things that some people have looked at is These ongoing hedge fund manager surveys bank of america is probably the most notable one that comes out on a regular basis And their latest fund manager survey found that investors rates their allocation to eurozone equities By about nine percentage points. I think I I did address this briefly before In one of my briefings last week, but it's the largest increase we've seen into a geographic region For equity allocation In a long time And you can see here the outperformance ever since the initial back in mid-may german French proposal that your recovery fund was tabled the european equity market has starkly Performed pretty much everything from the asia pack region to the s and p 500 which albeit is up a sharp amount It's just that europe has outperformed it. It's just done, you know an awesome job Ever since reacting to this significant stimulus and part of the discussion i was having with the guys yesterday is look Put this into a bit of context european equity outperformance You got euro currency outperformance and there's a lot of things here at play from a european perspective If you think about say 750 billion euros worth of now of what we have in this recovery fund Of 390 billion of that is in grants Not loans. So since the significant amount is not expected to be paid back You've then got the ecb with their pandemic emergency purchase program the pep It's got a total envelope size of 1.35 trillion You've then got the asset purchase program at the ecb That will continue at a monthly pace of 20 billion euros per month of bomb buying together with purchases under the additional 120 billion additional temporary envelope in qe from ecb to the end of the year You've then got the targeted third teltrose coming out of the ecb for bank of funding Then you've got all the national stimulus that all these european countries are doing on a singular country to country basis So there's a lot going on here To assure the economic recovery of the eurozone And they've made a lot of headway and there's kind of the cherry on the cake was not just independently But now collectively coming together in this european agreement that they've compromised and now concluded has been such a positive force and You know I I do think that definitely there's some upside here I would be expecting a test on this 116 in the euro in Perhaps today, but definitely in the coming days and weeks And then yeah, I think there's a there's decent argument for for alex's view That we're going to move up up towards the 118 and and target it back up to these 118 highs The other thing here is if i'm going to bring into the shot is the dixie Now the dixie obviously for for the same basis of the argument i was talking about this kind of Competition if you like now from this euro for this global's kind of status in terms of investors mind Let's not get away from the point that the dollar will remain the reserve currency given the amount of Proportionate trade that it makes up on a global basis But technically speaking this is looking at the dixie This is looking at the dixie over the last five to six years And the arrows would be indicative of a horizontal line of the 95 level in the dixie It bounced pretty much perfect on there On the the kind of dollar route that we had yesterday amid the euro strength Now you can see here. There's been some prior occasions back at the beginning of this year in the mix of the volatility with the pandemic We we bounced off 95. We bounced off 95 as well back in 2018 It was a solid resistance level Into kind of q4 of 2017 You know 95 is a big level for the dixie and we are trading right around there at the moment So that needs close monitoring because if we break through this And the dollar starts to break down further that's only going to accelerate that euro dollar move to the upside So definitely i'll be watching that closely over the next coming days for sure And to see how we bounce or break on those levels or perhaps even consolidate for the time being um The other thing of course has been the dollar weakness as we've seen going from 100 Really over the course of the last couple of months as the dust has settled somewhat on the market's initial panic over that flight to quality bid that The dollar received in the midst of the lockdown But as the markets are somewhat stabilized the dollar has continued to back off and now overlay that with this kind of euro competitive kind of idea that we talked about So fundamentally for the moment still remain quite bullish here in the in the euro over the medium term The other thing I quickly wanted to mention then as an extension of this Discussion is talking about this headline here Which was europe's three and a half trillion dollars now of unity rally leaves britain far behind And just reading through some of the headlines this morning. This was one of the things that I saw That goes in combination really with this So let me just read you and get you up to speed with a couple of the headlines in play in the press this morning And how i'm kind of entitling this is the euro versus the pound and with brexit As the real kind of topical point So britain and the european union will fail to sign a post brexit trade deal With only a few days left before the prime minister boris johnson's july deadline according to the telegraph newspaper Now this was somewhat of a so self-imposed deadline So for me this this part of the stories that i'm going to run through is not such a big deal Um, I don't think i'd be looking to just get heavy short on a short term basis in the pound Just on the back of that one singular headline And boris johnson was always trying to put in these self-imposed short term deadlines in order to kind of cultivate then progression in the talks that there's always kind of a looming deadline But ultimately most people have the opinion the autumn's where the real deal making is going to come when it comes to brexit In time for then that lapsing of the transition at the end of the year now few other things though Um negotiators then they still remain deadlocked on the same Issues this is potentially one of the more worrying things Is that there's been all of this back and forth regular teleconference and now face-to-face meetings And they're still stuck on the same points these points being deadlocked on fishing rights The deal's governance the european court of justice role and the so-called level playing field guarantees All of those things are the same things they've been debating for many months and the question mark is you know Can they actually get enough compromise to deal with these things not only this though? This was one of the other headlines that i had this morning This was in the financial times and it was talking about the british government has abandoned Any hopes of the uk u.s trade deal ahead of the autumn's american presidential election now remember You've got the presidential election happening at early november the brexit transition deadline of course where we still have a threat Of a no deal That's still a tangible outcome albeit a lower probability But that's then just weeks after that presidential election Hard to see then I mean imagine if you had a switch in government as well at the head and biden wins over trump Very difficult to see a trade deal being done in such a short period of time with entire new presidents in place so Lots of pressure there as well because you remember lots of commentary when brexit was first Done four years ago. It was about look the america would be first in line at the queue doing a trade deal would be easy peasy And here we are Four years later coming up to a looming deadline and basically the u.s Have got no interest in cutting a deal at this point. You know, there's so much other political self-interest that play here in a campaign year UK's further down the the queue in the order of priority of things so again You've got a couple of things here that are really key So the u.s and uk trade deal ahead of the presidential election is now pretty much not going to happen British officials are blaming covet 19 You know covet 19 is going to be the get out of the jail for most political disappointments For any ruling incumbent at the moment. It's going to be what's covet 19's fault But a third round of talks will begin via online video conference on monday between the uk and the us But no one's expecting any further progression or conclusive breakthrough at this point in time Thirdly, so we've got europe Got the u.s Thirdly, you've got china and you remember recently um uk has done a bit of a reversal on the dealing of using the technology firm Huawei We've also had then that knee jerk reaction and partly that due to this security bill change that we've had implemented in hong kong and so there's a lot of Pressure at the moment on the uk's relationship with china now Don't forget china is the second largest economy in the world and so You know having a very strong relationship is key here for the uk's competitiveness globally and also the country's wider interests And so on three fronts here the uk Is finding some difficulties all the meanwhile Europe is about as united as it has been in a long time and has this Phenomenal-sized cumulative monetary and fiscal response to the pandemic So fundamentally pound There's there being a complete divergence between the two And interestingly going back to that bank of america fund managers survey Europe then they've raised their equity allocations by nine percentage points You want to know whose? ranked as the most disliked? country It's the uk of course And this isn't just bank of america. This is resonates across a lot of big Institutions at this point of time if you think about it. Do I want to invest in the uk in the next three to five years? Sure, you know things are very depressed and ultimately things will work their way out over the long term Would I want to invest in the uk in the next six to twelve months? quite frankly, I'd rather Invest somewhere else because there's just too much uncertainty and tail risk around what if scenarios If they don't broker this free trade agreement or deal with the european union by the end of the year And so the uk's just out of favor, but but out of favor with the u.s And also with a very fragile rocky relationship developing with china at the moment All of this of course comes at a time where the government cannot backstop the economy forever And that time in itself is coming in the autumn for the uk As well prior to the actual deadline So there's a lot of things here stacking up against the government in the uk And I just thought I'd point these these things out Few other stories then that I just wanted to cover I'm going to take a look at gold and silver Let's just check out that gold chart because it is an impressive one to say the least I mean this is looking at the the move that we've had in the overnight session So generally in the Asia-Pacific session fairly illiquid you tend to then see these quite pronounced moves in the market You can see 1850 was always around that level I mean 1848 test got back up through it and then 1850 purely on the basis of it being A round figure on the center then 1900 Was going to be a key area and it just rocketed higher through that and you can see very much then A function probably of the illiquid market fast money move because the extremity of that wick would would reflect that type of price activity And now we're consolidating but don't forget we're consolidating with another 16 dollar gain on a day where we rallied a decent 20 30 bucks So looking on a monthly continuation. This is what the gold chart looks like and There's a couple of things I just wanted to point out for one, you know, why is gold rallying? Well technically speaking Obviously, there's been some some key Breaches of these levels we've been watching for a long time. Remember in the briefings I was delivering a month or two ago We were talking about this kind of the close proximity around that 1800 Looking at the futures here We've knocked on it a couple of times, but given the geopolitical general risks that are apparent Clear and present dangers around the world at the moment in various different geographic hot spots resurgence in virus cases slowing growth weaker dollar negative real interest rates in the u.s All of these things are bullish factors for gold with the technical breach then and now we've really opened it up With some clear blue sky for a move higher and 1900 And a retest on all-time highs Definitely, I think that's on the cards now 40 bucks off there could even happen today Um, you know hence the well how gold tends to move in this type of environment You know because targeting here there is no other technical level here on the upside to restrict this price now And all things remaining equal. I can't really see too much change into those factors that have supported Gold and silver prices more recently. So here the all-time high is the next target now that would be up We've got to go all the way back to 2011 when we printed at 1920. So the first stop here. You got 1940 bucks away from there now 20 bucks above there the all-time high and I did see some commentary out of city They've been quite bullish in recent research notes But I thought to add a layer of context they expect to climb to the all-time high in the next Six to nine months that being to here I mean, how about the next six to nine days we get there rather than months? But they also assign a 30 probability that we get to $2,000 an ounce in the next three to five months and yeah, I mean Definitely just given the way that global assets are performing at the moment Obviously the the all-time high will be a big marker But if we bust the all-time high Then that's really going to open the floodgates and then yeah, 2000 would be the next logical target. Why? Because it's a round figure and and humans are fairly irrational We just try to try to find confidence and faith in things that look familiar and around number will do the job 2000 would be hugely psychological So I do think we could get there under those circumstances All right a few other things then In the oil market, of course, I had the apis last night crewed infantry's rows by 7.54 million barrels last week so a little bit Of oil price just coming off that original high that we had oils being another one of those where Long-term levels have been breached We've broken above that that key area of resistance and been watching for a while A little push and I think now it's more a case of for me Um Consolidation really that level that was such a good resistance point now is such a great support point So just because we come off a little bit in the overnight session And we might see some volatility today amongst the infantry data That doesn't really detract from the point that for the moment I'd be looking for price to to consolidate between these two kind of price levels of 41 And 43 32 for now also with that 200 dma capping on the upside of with that march 2nd low To keep an eye on so all different trees later To keep an eye on But we'll get into that closer toward the time of the release um a few other things then for me to to wrap up on one is the Earnings perspective what's going on here? Well today we get microsoft and tesla They're coming after market though. They're the kind of two big ones that we'll be looking for There are other companies today pre-market. You've got the nasdaq exchange biogen thermo fissure a few other names aftermarket those where it's at And of these two companies just going to give you a bit of context around some things i'm watching for microsoft Um continue to keep a very close on their intelligent cloud business That's been the real focal point of interest for investors to look at and what has really largely determined their share price reaction in aftermarket trade Some positives first for microsoft customers spending on their cloud platforms and infrastructure You know this idea about supporting employees as they work from home in this new Covid era Should have been a net positive for the firm and continue strong growth in that particular cloud division on the negative side In their previous earnings report coming just on the end of when this this pandemic was initially just Or it was an epidemic status at that point was just kicking off in america They said there was a slowdown in transactional licensing Particularly in small medium-sized businesses and a reduction on advertising on on platforms like linkedin for him for example So they're the kind of pros and cons On the tesla side of things obviously This is one of those which generates a lot of headline buzz given teslas such a kind of fad stock Of the here and now their shares are up really not far off 300 percent for the year. It's just mind-blowing They only place second in the nasdaq to madonna, which is that U.S. Pharmaceutical companies has been working on that covid 19 vaccine or therapy treatment So they've had a phenomenal ride of late Couple of points though. I thought were quite interesting and what I was reading in an article this morning So let me read them to you The bottom line for tesla will be closely watched to see whether the company manages to pull off A profit based on on gap now gap is generally accepted accounting Principles now the reason why this is so important is that such a result would mark the company's fourth consecutive quarter of gap profitability Now that then has a very important milestone that the company has met That means the stock is eligible for consideration in inclusion into the s and p 500 And if you think about what that means then having entry into such a bell weather index like the s and p 500 means that That will broaden the pool Of potential investors into tesla's stock with buyers of index funds etf trackers That follow the s and p 500 gaining exposure now to the cars makers shares for the first time so Yeah, it could be super interesting I'll probably be tweeting this so feel free to follow me when those numbers come out later tonight I'll be quite excited to see how they they play out, but they'll both be aftermarket I did put all of this information on a tweet earlier with all the numbers the metrics you need to be aware of So to check it out check it out on my account Final things I just wanted to cover were the covid front And this was a graphic i'm going to hold up while so i'll go over a couple of headlines that have that have been spoken overnight First of all president trump the guy who would never wear a mask now holding daily coronavirus updates And has been wearing his mask and he's encouraging others to wear his wear their mask He's also warned last night that the coronavirus outbreak in the us is likely to get worse So it's kind of damaged limitation here trying to front run what is inevitable that numbers are getting worse california confirmed the infections in the state have now surpassed 400 000 and for the first time since the end of may the 29th of may the us has suffered more than 1000 deaths in a single day according to the covid 19 tracking project, which is one of the most followed in terms of those statistics So, yeah, the covid situation certainly hasn't gone away And there's a few other things here that I just wanted to mention for one This is another graphic that I thought was quite interesting of a stat that I saw This was looking at covid 19 hospitalizations in the us hit a new high Basically today surpass surpassing the previous prior high in april So hospitalizations are right back up there remember when people were panicking about facilities getting full Running out of spare capacity We're right back up to those numbers and those numbers are still anticipated to head further north at this point in time So definitely the covid situation the fact that numbers are rising And you can see here California, florida, obviously these these these other regions outside of new york have taken on us at a different speed And trajectory to that of what we had initially on the northeast coast in tri-state About hospitalizations are picking up Now that in combination with don't forget as I've said from monday There's a lot of focus on capitol hill at the moment about striking new deals in regards to congress and these relief plans senator majority leader mitch mcconnell Told politico yesterday that he does not expect congress to pass the next relief bill by next week And that's the complete opposite and in contrast to what the treasury secretary Stephen munichin has been saying and it's very important that a lot of these things with the amount and volume Rolling off that it gets supplemented with something now the key is is there's a lot of Political jousting to try and get the best deal possible Depending on what side of the floor you sit and so on and political internal Struggles that are going on fighting for power But the idea here is if that they don't get something together, which I think they will Then there's a risk that markets might get nervous then about further Implications that would have on the speed of the economic recovery because a lot of people would be out of pocket More loss of confidence as we saw in the consumer confidence data earlier this week More increased job losses Domino effect and so on the other thing on that front that I thought was quite interesting was this There was a lot of talk over the recent months about the kind of incredible performance of the city group economic surprise index The cesi is the yellow line here and what i'm looking at is the qqq so this is looking at kind of A club together reflective of big technology firms in the nasdaq And the surprise index is actually just dropping off a little bit So I think that's a natural course of things Is that you cannot always super exceed expectations because ultimately expectations continue to then rise to catch up pace And then we get a tipping point which we're kind of out at the moment Where now the economic reality of the data point starts coming in like consumer confidence and it misses expectations Because the bar has risen so aggressively high given it was so low before And so as that comes off that's going to be quite interesting as well So you know as much as there are positives in the market at the moment in the lights of europe Narrative we talked about you know gold gold is firing up But I think gold is supported you know gold is the one trade that kind of wins in all scenarios here I think that's why it's been so bullish As an asset You know whether things are great the dollar weakens or the dollar loses out on the european side as per the argument We've been discussing that's dollar positive virus gets worse or that's gold positive If the virus gets worse it's gold positive if they're geopolitical unrest it's gold positive so Yeah, I'm not I'm not saying jump in now I mean obviously the opportunities might well come if you get a good technical entry point I do think we are in the medium term going to all-time highs but You know there's a lot to be said For having some exposure to that asset at this point in time But there's a balancing act here at the moment covid hasn't been a big deal for a little while But I do think that that time is coming in combination with a couple of these other factors that I've discussed Um Calendar for today very quiet. There really is nothing of real interest happening You've of course got the does happening later on this afternoon. There's nothing coming out of europe Of interest or the uk Canadian cpi data this afternoon and you've got existing home sales out of the states from the speaker side of things You've got ecb's de gwendos kind of second in command at the ecb speaking of the us eu symposium uh and Couple of bond auctions as well. If you are trading fixed income You've got a gilt auction a european Longer dated german auction and you've got a 20-year bond auction for 17 billion dollars coming out of the the us And then those aftermarket earnings as I said microsoft tesla will be the main focal points All right, that is it as I said before don't forget to subscribe to the youtube channel Really appreciate all your support engagement and comments as always You know love helping you guys out if I can Otherwise have a good session ahead And i'll see you tomorrow. Thanks very much