 Very good morning. It is Tuesday 22nd of June. Hope you're doing well as ever if you are watching this delayed on YouTube And don't forget to like and subscribe to the channel if you want to get this briefing early Don't forget to check out amplifier live comm but getting straight into it and Looking at the heat map on the clothes on the S&P 500 yesterday really strong rally and fat that we saw across the major indices Eradicating pretty much all of the losses that were seen following the hawkish tilt from the Fed last Wednesday and a follow-up hawkish comments and bullard that dented equity sentiment on Friday So the S&P was up around 1.4% the Dow actually outperforming Helped by the fact that energy financial industrial shares really led to comeback The Dow up 1.76% the Nasdaq was up just 0.6% Commodity stocks that were hit hard last week We're really seeing the best of those gains in the small cap Russell 2000 in fact outperformed all of them and was up just over 2% One of the major areas here kind of sweet spots so to speak is the energy sector You can see here glowing the most green so you can see the lights at Exxon were up 3.6% at the close last night Chevron CVX was also up around the similar margin And so let's take a look at oil prices and those continue to move higher So here on the intraday view you can see we had a bit of a breakout and a nice platform for price on the pullback It came back to that same level of what was the high point of resistance Back on Thursday last week initially in the APAC session last night Sunday going into Monday And then we just managed to continue to move higher here And now at the high finding a bit of resistance up at 73 28 for the moment But if you look at this on a daily chart you can just see where we're at on the bigger picture now with oil and Continuing to just move up at the moment and from a technical perspective You've got that high the top from the summer of 2018 as the next kind of target here We're trading at 73 56 at the moment that would be up at 75 28 And then the overall larger upside target the October 18 high would come in at 76 90 but oil then really quite a focal point at the moment in terms of advancing the most in a month On a couple of different things few people are looking at some of the recent dollar weakness that we saw particularly Going back to yesterday's session albeit I must say that the Dixie is just actually firming up reversing some of those moves for the moments So worth keeping that in mind But the other thing is key time spreads surged now what we're looking at here is a case of Backwardation meaning that the near-term contracts are more expensive than further out in the future But why this is happening is expectations of further supply declines at the biggest storage hub in the u.s And so data-providing Genscape so if you're an oil trader there's kind of three major phases of information you get on a normal weekly basis Genscape on Monday API is on a Tuesday and then you get the DOE's on a on a Wednesday and Genscape reported a 2.6 million barrel drop in stockpiles at Cushing in Oklahoma last week according to people with knowledge of the reports and Infantries at the hub already at the lowest since March of 2020 So a tightening market and remember the u.s. Is in full reopening mode at the moment Remember just last week we saw the likes of those highly populous areas like California New York kind of taking the lockdown shackles off and completely now reopening fully Given that over 70% of the people in those areas have now been vaccinated and so yeah continues to To to play out in a very positive fashion for for oil prices and of course all of this coming in context of OPEC Not budging at the moment and continuing to lend it supporting hand from a supply-packed point of view So yeah, definitely WTI spreads at their strongest in years now as Cushing supplies continue to fall Some of the dollar fluctuation as well particularly downside Coming yesterday just helping propel prices higher or once again. So Helping that energy sector in the S&P but having a look then at the equity market One of the things here that was quite evident. I've marked this up just to give you a visual cue of where what we're looking at and Here we are I mean these ellipses here mark where we were trading before the FMC announced on Wednesday and this is where we're trading right now and Despite the excursion to the downside that we have on the double whammy of the hawkish to hike 2023 dot-plot and then bullards follow up on Friday Monday's rally was pretty extreme in fact One of the best single-day rallies you had a couple of months and it's taken us all the way back to Basically flat and you know actually when you look at this the all-time high is here Only around 30 points above where we're trading at the moment So, you know despite people getting a little bit spooked about the hawkish tilt that we heard from the Fed You know equity markets still remain pretty robust at the moment and a lot of that does come on the back of More comments from the Fed we knew that Fed commentary I mean there's a lot of speakers this week and that's quite typical of a communication tactic from the central bank to try and Kind of just steady the ship after we saw quite an extreme reaction last week And we've got a bit of a fight breaking out here between the hawks and the doves at the moment because the text For the testimony to US Congress about COVID-19 response That's happening today in terms of power speaking live, but the prepared text came out last night By the major news wires. This is quite common. I was at my desk Maybe half nine ten last night when the when the news came out And basically there's nothing too substantial that I'd say that power has said but just to go over some of the main stuff He said the US economy continues to show Sustained improvement from the impact of the coronavirus pandemic and ongoing job market gains But inflation has increased notably in recent months And he continued to talk about the fact that he sees that dropping off and reinforcing that transit review separately though on the back of this the New York Fed president Williams came out this is an FT piece last night as well and said that the US economy does not Justify a policy shift So for me putting these two comments together and given the fact that these two are two of the most senior most important people on the FMC Both powers prepared testimony Williams remarks suggest that the top top brass if you like at the Fed are definitely much more cautious on the prospect of Quick policy changes compared to those of what we've heard from more regional level presidents like Bullard and also like Kaplan So the Dallas Fed president spoke yesterday. He's a well-known Probably the most outlying hawk Anyway, did say favored starting the process of reducing the bomb purchases Sooner rather than later, but again given his stance generally on policy that doesn't come as a surprise But I think tactically this is all Part of the plan for the Fed as the way I see it You've kind of got these outlying hawks Sounding hawkish and and rightly so because there are elements in the economy that would justify that and you know I was just having a look at the Bloomberg High Frequency Index in combination with the Atlanta Fed GDP tracker and Although we're going to see Q1 GDP Final reading this week. I mean who really cares about that. That's old news now Looking at what those trackers are saying for Q2 GDP in the US. It's going to be in excess of 10% You know, so there's there's these kind of reopening pains to go through which are going to cause pretty explosive growth in the short term At least before we average out and so yeah, some of the hawks are being hawkish and And the center ground is being held. So for me, this is kind of We're just leaning in that direction Which I think is probably appropriate But at the moment the markets taking a degree of assurance and relative calm having reversed a lot of these moves On the fact that look the status quo at the moment is inflation is transitory and we're not going to move anything very quickly But you know, the seed is being planted now And I think the hawks are doing that purposefully because change will happen in time and we still stick to the timeline of A more in-depth kind of discussion on tapering to emerge Come then the signals in Jackson Hole to be formalized in September for the whole tightening process or reduction of bomb buying to commence the beginning of next year So yeah, a couple things there But just just flicking back to the charts for a moment before we look at some of the other geopolitical news that I think it's worth touching upon So quick look at the currency pairs The dollar index right now as I'm talking is now up about two tenths of one percent So in fact, it's pretty much reversed the Dixie the losses that were seen during the US entrance yesterday So we're back to pretty much flat in that move now trading at around just around the 92 handle So as such then that's just providing a bit of a cap for euro dollar in the near term you can see here So still upside keeping an eye for a firm level of resistance at 1943 and a half any further pull back here and we are trading sub pivot in the euro future at the moment be keeping our 119 04 and a half and then down to that double bottom that was printed Friday Monday at 1 1867 so at the moment you could argue this is a range and we kind of midpoint of that at this present point in time The dollar strength just helping on that recovery in a Dixie Euro dollar just just grind back down For the moment as far as cable is concerned quite a nice technical Response that we saw on the daily chart yesterday So again pretty reminiscent of the euro in reflection of some of the dollar recovery that we've been seeing the last couple Of hours during a the Asia pack session on the daily chart though Nice bounce off that previous low that we had at the end of April which was around the 138 Psychological handle as well as that technical support area and you can see 138 has been an inflection point for price on a number of occasions through 2021 so it's a meaningful level and we saw quite a decent bounce off that for the time being but again short to term I'll be keeping an eye on the dollar for the moment with a lack of real sterling catalysts Meanwhile elsewhere Just a quick look at gold. I've just been having looking at this price pattern here in gold that I've been looking at Which is this on the downside this trend line has held so far nice test and Support being founded around that level and so we're in close proximity to the lower bound of this kind of channel for the moment So I'm quite keen to watch that got the pivot just below But we really see too much support on any breakdown in price until we get further down to This level from the Monday morning low and the Monday kind of US morning low Which would be around the 1773 and a half level in the futures if we break the The recent pattern here in the pivot level Otherwise on the reverse near term we've got to get back up and through this kind of range here you can see These areas of support that have played out quite nicely through Monday and also in the Asia Pact session to then Kind of print that that upside of that channel Which has been that rising trend line going back from last Thursday the test on Monday and the overnight session So it's kind of the setup I'm looking at in gold at the moment terms of the driving forces as to what could be the trigger points there again Dollar fluctuation and movement is going to be quite quite key On a geopolitical front, it's kind of the three Three forces at the moment. So you've got North Korea Russia in Iran These are the kind of main talking points when it comes to the US Present and starting off with this is Kim Jong-un's sister, of course And she's come out and dismissed the prospects of an early resumption of diplomacy with the US Basically just saying that their expectations and ambitions are misaligned essentially I won't comment as yet as to what I think of that until I run through all three and then I'll give you the summary Elsewhere the White House has said it has no timeline on reaching agreement on the Iran nuclear deal And it will continue to negotiate that's of course coming after as a rainy election We talked about yesterday and then the US State Department says it is preparing strategic stability dialogue with Russia And it is in the process of of scheduling those conversations at the moment So on all three fronts not really a great deal surprising I think it's way too early yet to be brought back to the table after the current Journey of those meetings after several rounds with Iran I think that's still got some way to go before we get to anything more of a definitive agreement As far as Kim Jong-un's sister is concerned, that's probably the least surprising of the three They're just keeping a fairly firm hand at the moment And I don't really think Biden's got too much appetite to Reengage with North Korea at this point when he still has to really deal with China first Then Iran kind of second on the geopolitical matters and then probably Russia's third So North Korea is kind of there and present but also tends to be Almost a proxy for US China talks more than directly specifically about North Korea So perhaps this is just part of that that usual political play from from China at the moment And then yeah, the Russia side following those meetings from Biden Putin last week. This is probably what you'd expect So fairly lukewarm But warm to a certain degree and so it's just about when they're gonna talk again So for all three of these I don't see any impact for that from the market open today But probably prudent to update you on those matters As far as the calendar is concerned It's it's pretty quiet in fact for today There's really nothing at all coming out in the UK European morning from a data perspective Therefore leading on into the afternoon We get the US existing home sales report and the Eurozone consumer confidence flash reading for June and API inventories come later on in the evening as per usual from a speaker's perspective Chief Economist of the ECB Philip Lane talks about the resilience of the euro at three o'clock There will be a text release in Q&A Feds Mester a voter next year will be speaking on monetary policy At 330 feds daily who's a current voter. She'll be speaking at 4 p.m. And he's to be schnabel will be speaking at 630 and again as far as Jay Powell's Testimony to US Congress on the COVID-19 response that does happen at 7 p.m. London time formally But again, we've already had the text out last night. So not expecting that to be a market moving event And then you've got 60 billion dollars coming a two-note auction just to wrap it up for any fixed income traders So that is it not gonna go any further gonna leave it there any questions at all Feel free to reach me in the Amplify live community or on YouTube Just drop a comment happy to help but otherwise have a good day ahead. Thanks guys