 Okay, very good morning to you. I hope you're doing well. It's Wednesday the 9th of June and gonna just give you a quick update of where We closed on Wall Street, which was absolutely flat So it's not gonna take me long to explain what happened yesterday or Monday, which is not a great deal And I don't think that really comes as too much of a surprise Given the fact that we know that on Thursday really is the real highlight of the week and that is the US CPI reading We also get something for things like the ECB monetary policy meeting as well Today, it's a little bit more interesting on the calendar. We've already had some Chinese inflation data Which you can see here, which we'll talk about in a moment which came out overnight Also got the Bank of Canada rate decision this afternoon and all inventory Numbers coming as well following the API's last night as well as an auction coming out of the US But again today's Canada a little bit more going on But still not a great deal and still a day before the kind of main event still to come So keep that in mind I think when you're just thinking of Intra day day trading strategies and the way the markets been reacting of late Which is talk to some of the traders yesterday just having this kind of degree of of of patience I'm not getting too caught up Expensing your your kind of ammunition if you like too early in the game keeping some back For what's arguably going to be probably much greater market movement and overall then direction Rather than this kind of flip-flop price action that we were seeing yesterday And certainly, you know, if you were looking at the likes of gold yesterday Just have it up here. I mean we saw some pretty extreme price movement on really not a great deal of information If any at all and we came up to I guess a fairly nice sweet spot around 1905-06 where the price actually turned on that initial Change of direction and around the comics pit open yesterday, which was kind of where these two trend lines met And close proximity to the prior days high in the overnight session And then it kind of rocketed down came back and not a great deal of rationale there Certainly no real headlines to really explain a lot of that price movement at the time Elsewhere if we're looking at the S&P 500 Just respecting a general range for the time being It was this trend line going back to the high that we had back on the first being respected a couple occasions We actually broke through that as we were just heading into the Wall Street open of which then we saw some selling pressure And again, we dipped and then recovered not too much really to explain the rationale behind that I think just coming out of the microcosm of short-term Price-tick data actually The market's not really going anywhere. This is as we know on the daily continuation You can see we've got right up there Tested that all-time high and now we're just kind of sitting there waiting for that CPI report to hit You know, and if it is a low ball number One would imagine then we'll get the breach and break and push on to the upside if it is a fantastically strong Number well and above the market consensus Then potentially then room to play back down to the 4200 and the range low There's been quite a key level here on daily chart of 41 80 and a half in the S&P 500 Otherwise in other markets the dollar is very quiet So major pairs are basically unchanged in the currency space the 10 years unchanged The one thing that has seen a bit of movement Through yesterday's session, which was quite interesting was oil really firm recovery really going into North American trading hours We had before as you know been tracking that trend channel higher in crude of which we which broke down two days ago We saw a bit of a dip down to 6850, but as you can see there after Finding a bit of a foundation Around that level and holding price really just started to speed up yesterday again Not too much in the way of an individual headlines that we're driving that move But we have now firmly broken above 70 and you can see here this $70 handle as Marked by this rectangle that was the previous high the kind of short-term Objective then was some Short-term price price or profit-taking and then we come back up to that point We broke come back down and that's acted as a nice platform for the push high We've seen in the overnight age of pack session and we remain higher at the moment up around 36 cents at 7041 the intraday highest is at 7062 so on the daily chart now Still needs to be watched and obviously where we close on a day will be quite key But as you can see on the daily, we're starting to really push up to levels not really seen since the summer of 2018 longer term objectives here would probably be around 72 And a half which would be the highs that we saw in mid-October of that year in 2018 and then up to the next area around 75 handle Psychologically and also those highs from October 18 and the peak of price activity in the summer in July of 2018 I'll run through the API's that we had last night, but overall summary there had close to no impact on price overnight So let's let's jump into this Chinese inflation situation. What exactly is going on and Overnight you had Chinese PPI which you can see here Deloted by the white line came in at 9% This is for the month of May on on the year-in-year figure now is above expectations 8.5 and an acceleration the highest kind of pace if you like since 2008 and that was from 9% from 6.8% The Chinese CPI year-in-year was actually weaker than expected came in at 1.3% Again, it's expected 1.6 and previous 0.9% So you can see here the divergence that we're getting which is quite clearly price pressures on the producer side, but Remaining much more benign as far as consumers are expecting and here's a couple of Interesting points to obviously be aware of so the rally that we've been seeing commodity prices being fueled obviously by a few different things We're going through a phase of economic recovery Pandemic induced supply shortages are apparent at the moment. Remember, we've had commodity prices everything from copper to iron to lumber Although a lot of those prices have pulled from those initial spike highs They are still very elevated and then we've had records amounts of stimulus from governments from all over the world as well And so far the impact of metal prices has showed up mainly in what we call upstream Industries so that being things that were involved with the actual mining of those aforementioned metals For example processing those raw materials price increase in downstream industries like furniture and textiles have been fairly Minimal at this point. There's a couple of interesting points then that that leads to Which is if you're looking domestically in China the pass-through from PPI to consumer prices has been Fairly limited in fact China's inflation gap between factories and consumers is now it's wider since the early 90s in 1993 as you can see here. We saw a bit of a peak In Recent years this would be going back to 2016 But again, we're now over that and back to those levels in 1993 Now one of the points here being is the intense competition among smaller businesses Spurred by the rise in e-commerce weak domestic demand means China's factories are absorbing input costs Rather than passing it on to consumers at home and obviously that's a really important point how long that can be maintained though is something that's going to be quite quite a thing to keep an eye on going forward about this idea of How transitory or not these inflationary pressures are going to be the other thing that is about Food prices anyone who's been tracking China and inflation will remember around a year ago or so This is when the pandemic really took hold over that lunar new year period of 2020 But pork prices were going parabolic at the time there was lots of different reasons one of the main ones was the African Swine flu and that was leading to a large culling of pig farms And so it's squeezing on the price of pork of which obviously is a staple of Chinese cuisine And what we're seeing now is the complete opposite of that and actually the inflation numbers overnight If you start looking at CPI inclusive of things like energy and food prices Almost 24% full was seen in pork prices Undercut stronger price prices for most other foods So you're getting me of a rebalancing of that pork situation And given it was such an outlier last time then it's having quite a an impact on decreasing the overall figure Separately to that data the government apparently has pledged to increase the supply of key food products to stabilize prices And add to the national pork reserve So yeah a couple things there to be aware of first of all from a trading point in view none of this really I feel is Meaningful for the different charts and products that we just looked at so if you're trading us indices the FX markets dollar-based Commodities things like that. I wouldn't be looking at this Chinese data thinking right I need to strategically formulate some sort of trade idea intraday on the back of that That's not what I'm saying. I don't think it really carries that type of immediacy in terms of its its impact But it definitely is interesting Again, though, it's not surprising I wouldn't say because this divergence that we've been seeing from PPI and CPI in China is not new It's been ongoing. It's just that it's getting even further apart at this point in time as Mentioned here in this winding gap between factory and consumer Inflation gap so just like to be aware of Other things then to talk about Rishi Sunak here the UK Chancellor Yesterday we were talking a little bit about potential on the times headline at the weekend talking of a two-week delay to the final step of the roadmap to reopening the UK on June 21st while the Guardian has an exclusive and basically they've said that Rishi the Chancellor is willing to accept a delay of up to four weeks for the final reopening in the UK The government's considering Those extensions a final decision there is to come from the PM on Monday when we get the latest update from Boris Johnson Now the rationale here has logic and It being if I scroll down to give you a bit of an idea of where we're at at the moment Here's what the COVID situation is and you know, it's not That we're seeing rapid number increases, but COVID daily cases are rising and that likelihood will try and will Lead on to an increase in the death rate going forward. It is the likely Probability of events unfolding and it's predominantly down to the Delta variant or the Indian virus or Indian variant the vaccination rollout continues and and touch wood that should start to continue to pick up pace 61% or so have now received the first dose. I get mine later on today So I'll keep you posted on how I feel and what drug I get given in tomorrow's briefing and then People who've received a second dose is around 42% at the moment Now a delay of up to four weeks The logic here would allow second vaccine doses for all over 50s to have been administered and take effect before Reopening under the government's plan. So so a couple things here the Delta variant Does have a degree of how? Or it does impact different variants of COVID How robust let's say the efficacy rate of these vaccines is Cup two other kind of points here is whether you've had one or two jabs Effects then the type of level of protection that you could expect as an individual and then also the time frame after your jab because generally then protection rates tend to increase over time and So one of the things here then is obviously over 50s typically is in the more kind of vulnerable half of the the age category and so allowing them to have their second jabs all People of over 50 in the UK plus give them time for that the vaccine to really kick in and start hitting that kind of 80 90% Effectiveness rate rather than I've read some reports that even after one dose the astro drug could be as low as you know sub 40% Because of the fact that remember this reopening would be complete Irradication of any social distancing no requirement to wear face masks no capping on weddings No capping on numbers at sports and all these sorts of things and so the government given the transmissibility of the Delta virus are very Keen to get those vulnerable ones under control first. So that's where that's coming from the second kind of Arrow if you like to the plan is that it would also coincide with the end of school summer term Reducing the extent of which outbreaks can be fueled by children passing the virus on to one other On to one another in the classroom. I mean, you're probably recognized for me doing the briefing I've normally got a sniff I've got a runny nose right now or a cough because I've got a young toddler and she just goes to nursery and whatever Any of the other kids have got I get because she's just to carry her in that sense And so part of the other strategy here the government is that it's the end of the summer school term So obviously then kids are off school for a number of weeks and that stops them the ability for them To not show symptoms but carry and transmit the disease then and pass it on to their parents for example so One government source pointed out that many cases the Delta variant have been among children and of course not many of those Are vaccinated as yet as well. So I Think it's pretty clear to me that the 21st of June is going to be delayed I guess the question is by how much two or four weeks If Rishi Sunak who's the chancellor whose main priority of work is then the state of the economy And he's happy with four weeks. I can't really see too much then resistance to delaying by that much It's more to do then with management of the internal conservative party at this point. You gov polls I was looking at yesterday show that public opinion. I think this was back in 8 Was it April must have been when the initial roadmap was outlined the idea the public perception of us Reopening on a June 21st was around 65. I think it was percent Whereas the latest you gov survey I think must have been conducted last week now sees that the general public's perception of Reopening on June 21st as only around 28 percent. So I think the public's pretty much geared up for this It's it's the Steve Baker type conservative member That Boris is going to have to manage with this delay from a market impact point of view I don't think it makes a difference either way for the sterling currency to be honest whether I delay two or four weeks I think a lot of that's been it's going to be as expected Okay, few other things you just blow my nose one second There you go. You know this you know this recordings live when you need to watch me blowing my nose Rather than the new troopers doing the cut and the edit So just wanted to have a look at Bitcoin Strategists seeing possible drop towards $20,000 Now I'm going to bring Bitcoin into shot just for one second to give you a bit of context of recent price movement and here it is So let's put it on the daily chart and I got a few markups here Of course that we've been watching of late Since we really peaked going back to it was only April it wasn't even really that long ago So from the April high which we printed which was north of 65,000 and we're now down Roughly 50% Even from Fridays, we're down about 14% What was quite interesting yesterday and Bitcoin was looking a bit susceptible to potential downside it certainly ignited the The bears to come out of the woodworks to really cool that lower price of 20k in Bitcoin was We had this trend line going from October of last year And also the 200 DMA which we broke through but importantly closed above yesterday We have gone down to retest that overnight, but then bounced again off the 200 DMA But the point being is what these these different firms who have these more bearish calls are suggesting is that if we break 30,000 which was basically the bottom of that route that we had in crypto generally on the 19th of May Then that would open up the trapdoor to have slipped down to 20k now looking at this technically I'm looking at Bitcoin futures here. There's a couple of stop gaps before 20k I'd say as marked by these these boxes. You've got 27k, which was that previous Double bottom that we saw back in late January of this year a slip down there goes back down to 22 and a half thousand Which was the peak at the end of last year before the kind of ramp up that we saw into the new year And then then going down to that 20k sub 20k region Which would put us back down to where we were before we got the 20k more definitive break Yesterday obviously we've had the IRS ask Congress for authority to regulate crypto Some people were also talking about on Bloomberg analysts point in recovery of the colonial pipeline companies ransom as Evidence crypto isn't beyond government controls another reason for the rationale yesterday's decline I'd say it's probably a bit of a tenuous link personally I think with these sorts of things there certainly is Can be fundamental catalysts and certainly China and a lot of their rulings over crypto and just general government authority Intervention to regulate that type of thing To impede activity in the space certainly is going to weigh in has been really the main factor Aside from the likes of Elon Musk Dropping these little hand grenades every now and again. And so at the moment, I think Bitcoin does look a little bit susceptible You know, I can't recall all of the numbers, but I was talking to one of the guys yesterday And I was listening to a good podcast the other day And it was talking about the idea that actually the majority of money invested in Bitcoin if you're looking at the entire Kind of ecosystem of what comprises of investments within Bitcoin that the large majority Are those people who really truly believe in the underlying potential of the technology the philosophy of what Bitcoin is in terms of Decentralized and blockchain and so on and so forth and that the idea is that these guys are just buying on every dip And that actually that comprises of something like I'm sure the stat was 87 percent of all holders And so I don't think necessarily Again, it's kind of a two-fold approach. I guess with Bitcoin. I think if you're gonna trade it I mean, I personally would wouldn't go near it with a barge pole to trade it but to invest in it sure There's enough people with enough clout and size it would seem with enough position accumulation That this market will inevitably go higher over the long term And it's better to be invested in it to catch those those general moves higher And surviving these dips, but yeah trading it right now as of today I think it would be difficult because I think the market could well be susceptible And if we do break 30k a drop to 20k, I don't think could be in any way a surprise if that materialized and a drop of 20k just to remind you would be akin to about a 35% drop on the already 50% move lower that we've had And you start talking about 80% move on a correction from the high and you think my god, that's massive. Well, it's not massive for Bitcoin. So You know, it's just something we'll keep an eye on as we go through the rest of the day Okay final few things if we look at US politics this isn't again really moving markets, but an update a group of Republican Democratic US House members are trying to keep alive the hope of a bipartisan infrastructure package They've agreed 761.8 billion in new spending over an eight-year period together with the already agreed numbers That would total now 1.2 trillion, which is obviously short of the Biden 1.7 but as per any negotiation the goalposts are kind of Converging in on one another. So some progression there being made In the oil market, we did have the API's last night Not going to dwell on these because in actuality, they had close to no impact at all in terms of the price of oil and Really, I'd just be looking at them as a reference point as to determine the type of reaction we'll get Later on with the DOE's but crude nonetheless was a drawdown of 2.1 million Slightly smaller a shallower draw than the 3.5 million expected pushing draw 420 gasoline build 2.4 million All right, quick look at the calendar for today inflation data out the way as I said the calendar is pretty quiet today So same rules apply just be mindful of your technicals And and perhaps ranges being respected Perhaps breakouts if those stronger levels are broken, but otherwise, you know Be ready for potentially another slow day barring anything unexpected got the Bank of Canada coming out at 3 p.m Could be quite interesting. There are no changes expected an actual policy in itself in terms of rates or their QE program However, you remember the bank reduced its bond buying From 5 billion to 4 billion last October and then lowered that rate to 3 billion In April so they're going through already tapering So they're kind of way ahead of where the Fed are and even just having that discussion No one's really expecting that taper to happen again today But a lot of people are looking further tapering could be seen by the July meeting Where essentially at the moment the vaccination rollout in Canada has been Fantastic They've got a really steep curve in in that sense way better than the UK the US and other areas And so I think they're around 60% or so in terms of people receiving a first vaccination now The point being is that they've had some tricky COVID situations Which has required some restrictions and lockdowns in isolated regions within the country However, going forward by July, we should have greater visibility on reopening trends Greater conviction on then to be had on whether or not it's the right decision to further roll back those bond purchases So starting to look out for certainly would be a surprise if it came today and would certainly see a Firm injection of price into the CAD if they did it now Probably not likely so and probably more like to come in July. Then you got the DOE's at 330 Speaker-wise no one really major and then from an auction point of view German supply index link around the UK and 38 billion a 10-year note from the US All right, gonna leave it there Let you guys get on and have a good day and I will see you in the amplify live.com chat room. Take care