 Okay, happy Sunday. Hope you're doing well I've had a great weekend and enjoyed the the sunshine wherever you are thought I'd get ahead of the game and put this Briefing out early Sunday night ahead of the globe X reopening instead of the usual Monday morning Just to buy myself a little bit more time I will endeavor to share the latest kind of headlines if there's any that comes out overnight and some technical charts into the Amplify live discord private room for the community But otherwise look let's get straight to it and let's have a look over a few things I want to discuss going to wrap up some of the weekend news flow obviously historic G7 tax deal That's been struck has been a little bit of volatility in crypto again overnight and There's some updates on the US infrastructure bill in the US as well And so quite interesting Information that's come out that could be slightly problematic for Biden going forward Then we'll look at the week ahead going to focus on a couple of key things We've got the Bank of Canada and the ECB interest rate rating meetings happening this week Wednesday and Thursday Respectively and probably the main feature of the week is going to be US CPI Coming out and also we have the release of UK GDP at the end of the week So let's just get straight into it and have a look at the charts and obviously a little bit of a digestion of where we where we finished post payrolls and obviously payrolls came out and Very similar fashion really to what we had last time where the market was kind of Perhaps not quite caught so offside as before but again the bar was a little bit firmer You remember on Thursday. We had a string of good data including the likes of a really strong forecast beating ADP and AD and and payrolls on Friday did not live up to that kind of expectations so as such Quite clearly to see really in gold I mean these two spots are that sell-off that we saw on gold on Thursday last week And we had some of the good data coming out kind of technical breakdown Helping as well with the break of the trend line some momentum as we are triggering through some of the support levels but to where we really closed on Friday and Completely took back that entire move after that payroll report So as you can see here, you got gold at the top But we just looked at then you've got the s&p 500 on the right here and a t-note the US tenure at the bottom all Rallying and that tells you one thing. It's kind of a policy Moratory policy oriented move that it kind of validates the more cautious gradual approach at the Fed of which They've been telling us for some time that that is the kind of Tactic that they're going to adopt going forward irrespective of what we're likely to see which is again For fairly scary levels of inflation that will come out in CPR reports in a few days time From an s&p perspective, obviously We're right back up there again pretty much So we came up to retest that previous high that we saw Right at the beginning of last week and that's pretty much where we finished But you can see just the severity of the rally that we saw after that payroll report and remember that was the last Opportunity really ahead of the blackout period which is now in force ahead of that mid-June Meeting so it does take some of the pressure off and that certainly was reflected in market prices Friday about the idea of any near-term hawkish surprise and of talking of tapering anything of that nature and definitely not expecting too much of detail To be discussed at that June meeting and so on a daily continuation, you know, we're right up there again knocking on the doors At the all-time highs as far as the s&p 500 is concerned and that's an area We'll be keeping an eye on and what will likely dictate really whether we push on on the daily here break Perhaps pull back and then a push on next target up Psychologically up to around 42 50 here in the s&p really is that CPI number if it isn't as high as I'll discuss in more detail in a moment that people expect then certainly that in combination with the jobs Ongoing situation now the back-to-back payroll figure. I don't see any reason why we don't we don't print a new all-time high Certainly this week in US equities the Nasdaq if anything the Friday acceleration was even more Acute to the fact that tech stocks Particularly were suffering at the middle part of last week And we were seeing a bit more of a cyclical play where really strength was seen in more like energy and financials And that got reversed obviously on Friday Where is the tech and nasdaq now performing on the basis of that slightly softer jobs number that we saw From a currency perspective obviously that weakened the dollar and and gave some reprieve to what otherwise had been a downward trending Major pairs and euro dollar and cables throughout most of last week terms of euro dollar Not too much. I'm looking at really right now at this point in time When we get back underway and start recommencing trade but on a daily chart Obviously, we had a bit of a breakdown last week particularly on Some of the fluctuations in dollar strength on that good data on the Thursday last week Which did break the trend line definitively that had been holding up the euro of the last two months We have recovered some of that given some of the downward pullback in the dollar on the back of payrolls interested to see how we play out at around these levels really either north or south of this Horizontal 121 65 and a half in the futures Which as you can see has been a bit of an inflection point for the euro of the last several weeks as far as cable is concerned We do have some data coming out at the end of the week Which I'll talk about in a moment after I've wrapped up the news But cable's not too interesting near term We had a double top and what has been a good area as well at the end of May beginning of June At 142 handle which has been significant So definitely on the upside to be keeping an eye on that and then we had the Friday late evening lows Which came in at 41 55 which we'll be watching again largely for the week. I do think that it's more Dollar movement that will be leading the direction of these major pairs And it's going to be that see CPR report There's going to be particularly key for the fate of those major currencies as far as energy markets are concerned We continue in that upward trending market The trend channel is still being respected for the moment. And so that's what we're still watching Downside at 69 you can see the market bounced off that Going back towards the end of last week and that was also a point of resistance back on the third and on the second Of last week. So any pullback says a couple of areas to keep an eye on so 69 26 It's kind of resistance point turn support then the 69 handle then lower down 68 87 which starts to encompass Prices back for really the month of June and then also the trend line. Otherwise on the upside All roads lead to 70 bucks And again if we did get and not as high as feared inflation number and that weakens the dollar and The dollar continues to remain offered throughout the rest of that week Then there's no reason fundamentally looking more specifically to dynamics for oil. Why I don't think we can But we should stop us from going higher and eventually coming up to 70 bucks to be quite honest But look, let's talk about some of the news and what's been going on our obvious Concise as I can be We had this G7 ministers backing of a global minimum rate of at least 15 percent of tax They agreed that countries should have the right to tax a certain proportion of the largest most profitable multinational's profit in the locations where it is generated So as we know this is quite important for some of the big tech names in particular So your likes of Apple alphabet and so on given the fact that you know for us in the UK Places like in Dublin and Ireland where the tax rate is lower They play pay close to no tax at all and companies like Facebook would be included in that Couple of things to be aware of the Treasury Secretary Janet Yellen Said that both Amazon and Facebook will fall under the new proposals for the global minimum corporation tax However, I've just seen an exclusive for the Guardian newspaper in the UK in the last hour And they've come out and said actually there's a loophole, which would be particularly Net positive for Amazon to evade this tax And the reason for that is that a communique from the G7 ministers said that they envisaged pillar one would only apply on Profit exceeding a 10% margin for the largest most profitable multinational Enterprises and the reason why that is important is that restriction could then rule out Amazon where their profit margin in 2020 was just six point three percent very small comparative to some of the other companies And so therefore they wouldn't have to pay tax on that. So we'll see Obviously the accountants for these big companies are kind of geniuses and they'll find any way not to pay tax, but as far as market implications are concerned I don't really necessarily think that they'll be a Big or if any reaction in any of these tech stocks because this has been very well telegraphed This move was probably going to happen for one Amazon are going to evade it because of their low profit margin anyway as part of that first pillar ruling of how this Particular deal is constructed. So that's number two. And so I'm not necessarily expecting this to be anything to Impactful for the first week first day of this week's trade if you look at the weekend Dow via IG It's quite a good indicative measure of how we should reopen in the futures market shortly on Sunday night And it's seen flat. So the market's not really that spooked by this. And so that's how I'd be looking at it other things to be aware of This guy You might not recognize this guy does look a little bit like Liam Neeson actually come to think of it But it's not Liam Neeson It's Joe Manchin and you probably would have heard of him if you're fairly familiar with US politics because he's one of those names That is a bit of a thorn in US president Biden's side and a couple of things to be aware of here One is that we are looking for updates on the infrastructure bill in the US this week specifically and the reason for that timing is that the US Transportation Secretary someone you probably recognize his name for when he was running during the presidential race Pete Buttigieg He Circled Monday June 7th as the date by which negotiations with the Senate Republicans must have a quote clear Direction and if not, he suggested Senate Democrats should propose a more targeted infrastructure bill So looking out for commentary pretty much as we start the week and obviously this infrastructure bill Kind of dragged its heels a little bit and the more it drags its heels I was reading over the weekend in some articles that some of these US based Beneficiaries on the infrastructure side. So particularly types like US steel firms They've been up like a hundred percent or so in the last couple of months So if we start to get this infrastructure bill look a little bit shaky, they've got a long way to fall back To kind of reprice if you like and the new timing or the passage at all of the infrastructure bill And what we were led to believe just a few months ago So definitely looking out for that the reason why Joe Manchin who's the West Virginia senators particularly important is he holds a swing vote in the US Senate and on Sunday He voted to block a bill overhauling US election law presenting a major setback to Joe Biden's efforts to reform voting rights So what exactly it was this well Manchin said the bill which expands mail-in voting Lengthens the hours over which people can vote was the wrong piece of legislation to bring the country together and unite their country Remember Biden was particularly successful at the election over Trump Because of the mail-in voting system and the more he can kind of emphasise and push legislation or new forms of voting in that direction the more faithful will probably be for Democrats given the Demographic and the type of way of which they they're the Democrats tend to vote and So the other thing Manchin though reiterated that he would not help Democrats as well scrap the US Senates Arcane voting procedure known as a filibuster which requires a supermajority of 60 senators to sign off most pieces of legislation So again just to put this in context one of the main things here is that Although the Democrats do control the Senate at this point in time. Remember is the 5050 split in fact Satchity 5048, but the two independence voters kind of then put it to 5050 and therefore Kamala Harris the VP has the deciding vote and thus controlled to the Democrats Joe Manchin is a Democrat, but the problem is though. He's fairly Not that aligned with with Biden So therefore he is one of the main Figureheads if you like that can determine whether or not by the ministry administration can pass through key legislation And he's a key person to watch and his latest things could then have knock on implications Then for this infrastructure bill going forward So that's the update there in the crypto space Crypto stable coins. They've seen a bit of volatility Over really a main thing coming out of China and remember it was the Chinese legislation and further commentary that's just really Impacted Bitcoin in particular over recent recent weeks But we both suspended some crypto related accounts over the weekend When trying to view them a message would simply come up saying that accounts have been reported for violations of laws Regulation or we bow rules and so again more complications in that that key area has been It's weighed on the price a little bit But I was just having a look and it's kind of fluctuated today rather than necessarily be lower. I'd say But in the further development that undermines a little bit this idea about Institutional adoption the reason why this headline is mentioning Goldman's CIO so CIO stands for Chief Investment Officer and Earlier this week Goldman's held two round tables with 25 different CIOs of long-only funds and hedge fund managers And they were basically asked what do you see as quite key for going forward or what was your preferred investment style? And I know this is a bit small So don't let me talk you through it But basically what it was saying was which investment style or asset class is your favorite asking these fund managers And they said growth Followed by value and then which of these investment style asset classes is your least favorite Bitcoin number one least favorite new IPOs second least favorite, so again Not drawing too many conclusions out of this but obviously from a slightly bigger picture You know this institutional adoption is obviously a key talking point As we continue to go forward but with with Elon Musk Obviously pulling in pulling out of Bitcoin What is he doing with it with all the commentary of late with the large fluctuation and that kind of? short-term crash in prices that we saw and a huge volatility over that period Institutional adoption which might come in the future. It's probably not going to arrive anytime soon And this kind of ratifies that kind of the way that CIOs are thinking at this point in time All right, let's talk about the week ahead And a couple of key things as I said, I'm only gonna talk about the key things So it's not an exhaustive list just so you're aware, but just going through things then the Bank of Canada Is actually meeting on? Wednesday I'm just gonna correct something on my notes in fact so Wednesday the BOC is meeting now expected to shake Not to shake up the market Then they're expected to reiterate their recent policy rhetoric and probably decide then they're gearing up for another round of QE tapering Which they've already commenced probably in the month of July Canada's been Experiencing two-fold. It's had a bit of a setback employment rates had actually says Employment rates had dropped for a second consecutive month in May That's because they've had certain pockets of outbreak of COVID-19 which has required more Containment measures to be to be put into place However, their vaccination rates in Canada are particularly good And so therefore as we go further forward in the months ahead further tapering is expected to continue going forward in the economy to expand the next arguably Biggest thing of the week then is US CPI now US CPI is due on Thursday And that is expected at four point seven percent That's against a previous of four point two percent the core year-in-year is expected to have risen through from three percent to three point four percent So that would be the highest levels since the mid 1990s and if you think about where interest rates were there in the US are awfully lot higher than where they are at the moment So again, this is key because the market is ultra inflation Sensitive and this is an inflation Metrics measuring forward-looking expectations of inflation. This is inflation as it's measured. So These numbers are going to be a real test for the market and this view of how transitory inflation is and Couple of things here to be aware of and a few things I was reading for one It's quite important to think about or what other drivers of inflation to determine whether or not they are indeed transitory I temporary of nature and as you remember the last CPI report You can see here the main drivers of core inflation in April and used cars Transportation services and shelter now a couple of different things to be aware of then so first use cars Prices of used cars increased in an astonishing 21% year-on-year in April if you think about what's been going on chip shortages Causing a lack of manufacturing of new autos So therefore squeezing up these prices and the expectation is is that this is going to carry through into this month's reading Or this week's reading as well The other thing then is the and second is the rent of shelter component What also transportation services were also part of flipping the April core inflation report and an upside direction So they're the key areas that you need to be looking for and how they're performing When you're kind of interpreting this number, I guess the more proportion it is concentrated in in an area Let's say like used vehicles. I would say that the less Evidence that gives to the inflation bulls Because then if once you take that out because auto manufacturing will pick up in the period ahead as the economy Reopens and people go back to work and there's less supply constraints Well, that number is going to come down again. And so therefore by definition This is temporary and if it is one of those main contributing areas This is how people are going to compute whether or not the Fed is right in the stance that they're taking The true test of inflation are just reading a report out of Nordia this evening And they said that really it's going to be what happens with inflation. It's likely to stay Present over summer. It's about what happens after summer, which is going to be key the direct Bonuses if you like of the Biden administration So stimulus checks and so on will run until September But in parts of the US the checks will already be halted during June for areas like Iowa Mississippi and that will give us a flavor of how the labor market looks posts these money handouts Which we know The lot of federal states as well have been cutting off some of those programs trying to encourage people to get back Into work given the fact that they were benefiting from the fact these stimulus checks out weighed minimum wage in the US So a couple things to consider that the final few things are we've got the ECB meeting on Thursday We're not really expecting anything of a great deal to come out there from a definitive policy change point of view It's kind of like they need to avoid Mentioning the word taper just to keep the markets Remaining confident that nothing's going to come out and surprise them particularly given the fact that lockdowns are currently being lifted in Europe Vaccination rates to continue to improve Despite the slow start that we saw several months ago. So business activity consumer confidence and inflation are all expect to rebound shortly One of the main things to remember is Christine Lagarde herself said late Last month that it was far too early to discuss reigning in plans around their bomb program We've had a number of dovish comments out at ECB officials in the recent days and weeks That would lend its hand for them not to do anything too drastic this time round However, we do get the latest staff economic projections growth expected to be relatively unchanged inflation like to be bumped a Little bit higher is probably the base case that most people are looking for and then on Friday Just to wrap things up. We get the UK data coming out, which is GDP The reopening of shops outdoor hospitality in April will unsurprisingly lead to another decent monthly growth rate and pretty much reiterates then that kind of more Medium-term positive outlook for the UK of which at the moment comes in contrast to what has been the trending weaker dollar of late and that should keep Cable knocking on the door at these multi-year highs at this present point in time But that's that's it. So I'm gonna leave it there as I said I'll update for the guys in Amplify live.com if you're not part of that community yet You can join absolutely for free. So just check it out Amplify live.com But for those already there, I will see you first thing in the morning And I'll be sharing some technical charts and an update on the news and so on. All right guys Thanks for listening and have a great week ahead. Take care