 Hello and welcome to CMC Markets on Friday the 19th of October and this quick look at the week ahead beginning the 22nd of October with me Michael Houston and if investors didn't have enough to concern themselves with respect to the US trade policy, Brexit concerns, the Italian budget, a slowdown in the Chinese economy as well as the possibility that the Fed could raise rates too quickly. We've also got concerns about the oil price in the wake of this week's events surrounding the disappearance and potential murder of a Saudi journalist in the Turkish consulate in Istanbul. So what does this mean I think for risk appetite? Well markets have stabilized albeit at multi-month lows and above some key support levels. In particular the German DAX has found an element of support around its 200 week moving average and as thus far we do appear to be managing to hold above it quite nicely. If we look at this long-term weekly chart we can see that the 200 week moving average has acted as a decent area of support over the course of the past four to five years. We can see that from here. So it's a very important level and certainly a level that I will be keeping a close eye on over the course of the next few weeks. A similar sort of area of support can also be drawn on the FTSE 100. You can see here that we've pretty much traded sideways. We had a very big move up earlier this week. Since then we've reversed that. So at the moment investor sentiment remains particularly cautious and as we can see from here with respect to the 200 week moving average on the FTSE UK 100 it's acted as support and or resistance in fairly equal measure over the course of the last few days. So I think certainly in the context of the UK 100, the FTSE 100, the DAX and also the Nikkei 225 which is also found a decent area of support. This is the daily chart that we're looking at here. We go back all the way back to the lows in 2016. We've got a trifecta of support levels on some key indexes which could give a decent indication of future direction over the course of the next few days and the next few weeks. So keep an eye on the Nikkei trend line. Keep an eye on the 200 week moving average on the DAX and keep an eye on the 200 week moving average on the FTSE 100. Now Brent crude prices despite concerns about the Saudis weaponizing the oil price have drifted lower and the decline in the oil prices has started to test the 50 day moving average. I think what's also important is even though the market is starting to turn a little bit oversold we've managed to fall back below the $80 a barrel mark but that in itself isn't that significant. I think the key level in respect of oil prices is whether or not we're able to stay below this $82 a barrel level that we found enacted as resistance here and here throughout the month of October. If we can hold below these levels on the back of rising inventories and for two weeks in a row US inventories have come in much higher than expected at over 6 million barrels a week then concerns about a global slowdown could well see oil prices decline much further and that will be fairly good news for inflationary pressures and I think also call into question the pace of any potential Fed tightening measures that might be coming down the pipe. Now at the moment there's concern that the Fed might be on the cusp of a policy mistake with respect to its keenness to over tighten monetary policy. They've been talking about pushing rates up to a level so that they're much better prepared for any new crisis that comes down the pipe. The only problem with that thinking is that that policy could actually precipitate the crisis the very crisis that they're trying to prevent. So as we look ahead to next week we've also got a couple of other central bank meetings in focus namely the European Central Bank rate meeting on the 25th of October and the recent ECB meeting has shown that European policymakers remain determined to end the bond buying program by the end of this year and I think the bar to that not happening is relatively high that being said we cannot ignore events going on in Italy. Now the European Commission have rejected the Italian budget and they will be looking for a response from Italy on Monday. So looking at the FTSE we can see that from being the best performing index this year in May it's now the worst performing index and now in a bear market having now being 20% down from its peaks of this year. And the likelihood is we're probably going to head an awful lot lower particularly as Italian bond yields are now back at levels last seen in 2013-2014 and that will have an effect on Eurodollar irrespective of whether or not you think it's going to be resilient going forward that the downside pressure is starting to build on Eurodollar and we could well see a retest of the lows that we saw in August. We've also got Brexit concerns but I think they are going to be an ongoing that's going to be an ongoing saga. We've also got US third quarter GDP and that's due out on Friday the 26 and that could well come in in excess of 3%. Now if it does do that all comes in and any better than that then again all the speculation about a potential four Fed rate rises in 2019 will continue. At the moment US 10 year yields are finding a top around about 325 3.25%. That's the key level that I would be keeping an eye out for next week and certainly in the context of US data I think that could be a tipping point for further dollar strength but also further stock market weakness in the US because ultimately higher US rates mean higher mortgage rates and also mean slower US consumer spending. We've also got the Bank of Canada rate decision next week and it's highly likely that the Bank of Canada will raise rates next week to match the Fed rate rise that we saw in September. If we look at core prices in Canada they are at eight year highs unemployment is around 15 year lows and inflation is at 2.8% so it's going to be very very surprising if the Bank of Canada doesn't nudge rates up by 25 basis points when they meet on the 24th of October. So keep an eye on this downtrend line on dollar CAD currently comes in just above the current highs at the moment of the day which is around about 131 so 131 a key resistance level on dollar CAD. Other things to watch out for in the coming week France and Germany flash PMIs for October also key earnings announcements from RBS Barclays, Microsoft and Twitter can all catch up with that on the week ahead document on the news and analysis section on the website. In the meantime have a good trading week this is Michael Houston talking to you from CMC Markets.