 Welcome to this week's CMC Markets Weekly Charcing Analysis webinar. My name's Jasper Lawler. I'm a work as an analyst here. I've got the risk warning on the screen. I'm just going to get that through here. Okay. Now over to the platform. Now as you can see, it is just a sea of red in equity markets today. And that's just basically the only thing you can do is the volatility is on the up. It's our volatility index, the VIX stocks are down. Obviously some of the biggest losses being seen in Europe. And this is all just because of the Greek crisis, obviously. There's capital controls in Greece today. It looks almost certain that they won't make their IMF payment. And there's just concerns in markets that even though Greece is a small economy, they could come tumbling out of the euro. That kind of destabilizes the euro in itself, which is obviously a major currency. And it's just a concern that, you know, it could be a kind of butterfly effect, which my colleague Michael wrote about in the morning report, that these things could just spread through some sort of contagion. And, you know, what's an issue in obviously Greek financial markets now. The Greek stock exchange is closed. But you can imagine the Greek bank stocks are going to take it hammering. Banking stocks in other European markets are getting hit pretty hard. And there's just a worry that a financial small effect in Greece can just spread through markets and hit other countries. A few things going on this week. We can have just a look at our economic calendar here. So we've put up our trading tool on our market calendar. And so this is what we're dealing with today. Not so much going on today. The big one today, which we've yet to have the result from, is the CPI from Germany. Now inflation has been starting to pick up again recently in Europe, helped by high oil prices, but also pick up an economic activity. And so, you know, there's a sort of growing concern. And why we're seeing a bit of a pullback in European equity markets in general is that maybe the QE program won't run its full course. If inflation heads back to their 2% target, you know, there's not really a need to have the QE. That was the justification for the QE in the first place. And obviously the markets have been spurred on by the low interest rates, bond buying that was involved in the QE program. Housing data, really the only kind of important one in the U.S. today. Housing actually has been one of the more positive aspects of the U.K. economy. And it's why a lot of people are calling for Q2 growth estimates to be revised a bit higher, is that housing has been doing particularly well. Oh, for some reason it's gone to the top again. And then when we head into tomorrow, we've got retail sales to Germany, German unemployment, so a few key stats from Germany this week. So that's, you know, obviously Greece is really kind of rocking the Euro today. I mean, it's what's driving the movements in the Euro. You might kind of imagine that the Euro would be lower in risk of a quick default, but that's not actually what's been happening recently. The Euro is actually tend to move higher when Greece has got closer to an exit. And I think that somehow reflects the way the Euro is being used. It's being used as a funding currency to buy other currencies. People are selling Euros and using it to buy other currencies with higher yields, or perhaps higher future yields like the U.S. dollar maybe, but more like the Australian dollar and things like that with higher interest rates. And so they'll actually unwind those trades when there's a bit of instability in Greece. So the net result is actually the Euro, not people aren't really buying it, but they're sort of getting rid of their short trades, if you like, in their carry trades. It's a bit of a convoluted explanation for things the closest we can get. So GDP, final revision for the UK. This week's a battle. Yeah, it's a sort of rear view mirror stuff, but the pound, there has been some kind of raised expectations a little bit recently that we might even see a rate hike this year, which for a while wasn't even considered a possibility. Wheel is one of the more hawkish members. He said it could be as early as August. I really doubt that would happen in two months. We're going to go from 9-0 in the voting at the Bank of England to 9-0 the other direction. Seems unlikely, but he may be voting for that in August, and maybe that will be the beginning of a transition towards the end of the year. Maybe there is a chance, depending on the strength of the UK economy, depending on what contagion has spilled out from Greece to Europe, and then obviously the UK economy is dependent on Europe to trade. So if Europe's not doing too well, the UK gets affected by that. So a lot does kind of rest on Greece, but should things pick up a bit, maybe we will see a rate hike towards the end of the year. So retail sales for the US, more home data, and a bunch of PMIs, manufacturing PMIs really mostly across Europe on Wednesday. That's going to be the main consideration. If you're trading oil, obviously we've got the inventories data, so that's the most important item in the weekly calendar for oil traders. And as we move into Thursday, obviously the big one is the non-fumpare oils in the US. Now you might be wondering why Thursday is just because Friday is July 4th. Sorry, it's actually July. It's basically because of the July 4th holiday. They've set it back one day. So make sure you remember that the NFP is on Thursday this week. And then Friday, US markets on holiday, but we're still going in European markets. That's obviously going to be pretty huge for the US dollar. And US markets are stuck in a range at the moment. I don't think this will be make or break, but a really strong number could send us down towards the bottom of the range. The general trade with these non-fumpare oils has been a really strong number. It raises the prospect of tightening in the US. So what they kind of want is the 200 to 300 range is generally fairly comfortable, I think. But the consensus here is 230,000, so I think we probably don't want it much more than that. If it was 280,000 again, that pushing into 300,000 probably would be a concern for markets that the Fed may go ahead and lift off in September. So that's the bulk of the important data. We've got factory orders later that day, more PMIs on Friday, and then European retail sales. That's the data week ahead. Let's have a look at some of these charts. We'll start with the European markets. So the channel that we've been looking at for a while worked out pretty nicely in the end. So we had the lows through here, and we just had a parallel line along the top. And stuff is around there a bit, but as of today, and there's news in Greece, it's come crashing down and basically stopped to ride out this support line, this low here. We couldn't close there below that a couple of times, and we've paused here now. But I think there's probably a little bounce back from here, but my suspicion is that we will move towards the bottom of the range here, the bottom of the channel, and probably touch on this 200-day moving average if not drop through it. I mean, Greece is a real headwind for Europe at the moment, and so unless we hear of some major change in policy from the European Central Bank, I don't really see the – there's not going to be huge downside, but I just don't see us breaking up into new highs while we've got this Greek crisis hanging over us because European markets have already made a lot of gains on the back of the QE programme, and so I think we do need to – my take on it is that we do have to get through this Greek crisis first. Certainly some possibilities though. This support could be enough to push up to the top of the channel again but I suspect perhaps another drop down. So really a culmination of support here from these February lows, the 200-day and the bottom of the channel. When you have a confluence of potential support factors like that, it raises the possibility that it will get a bounce, but you have to be aware that this general short-term trend we're dealing with is kind of down, so if you are buying into there, you've got to be aware that there's a good chance that it won't make it back to this peak again. So quite where you take profits, if you were buying in this support area, that's trickier because you're going against the trend. When you're going with the trend, you can have the expectation that prices will continue and break highs if it's an uptrend and break lows if it's a downtrend. That's why trading with the trend is just easier. You don't know when a correction will end, when a bounce will end in a downtrend, so it's difficult to target your take profit level. Let's switch over to UK markets here. You can see the UK suffering a bit less than European markets. Obviously, we're not part of the euro. Thank goodness in the UK. So not quite as much contagion risk, but Chinese markets were down again. You can see we've broken the support here in the UK 100. I did see this happening because we've shown before in one of the previous webinars that a projection from the height of this pattern and the height of the pattern probably would be largest here at the beginning of the wedge. That projected down would put us at lower levels than this low, so the fact that we've broken below there is not a huge surprise to me. From here, given that we're in this downtrending environment, I would imagine that we probably do need to trade into 6300, perhaps might find some interest, and then the 6100 level has been pretty significant, so that may attract some buying interest there. We're downtrending. We're below all the moving averages. I mean, this tested the high, but generally speaking, peak, lower peak. Tested, but not a higher peak. Lower trough, lower trough, lower trough. So yes, it's downtrend on this sort of daily timescale. Obviously, we've got to keep in mind that just keep us some perspective on this. Still generally sort of upwards, positively trading market. And we can see actually on this weekly chart that the 6300 has another layer of support from this 200-week SMA, which has one, two, and three support to the price previously. Good chance for some support in that area, and I wouldn't be too surprised if we go down to test it. Maybe they'll find a last-minute solution in Greece. Varafakis, the Greek finance minister, has still said they're aiming for a deal before tomorrow, but to be honest, that seems incredibly unlikely. And then we're just going to have to wait for the result of the referendum in Greece, which is taking place on the 5th of July to see how the Greek people vote, whether they want to stay in the Euro and have the associated austerity or vote to end austerity, not accept the offer from the IMF and the European Central Bank and the Eurozone, and in not accepting that, probably drop out of the Euro. Let's jump over to US markets now. It seems some pretty hefty losses. I mean, it's only 1%, but if those are 200 points in the Dow, definitely a pretty poor start setting up. And again, even though we saw what I think I didn't quite actually mention, but in China, they did cut interest rates, so the typical environment would be quite a positive thing for markets, but really with this situation of Greece, it's just been put to one side. So US markets heading down on Greece despite some stimulus efforts from the People's Bank of China by cutting interest rates. So here we can see that we're still in this kind of trading range. There's a few different levels. We pushed down through this support for the first time, intraday today for the first time since 7th of April, which is pretty significant, lowest in what's that, two and a half months in US markets today. We've got some kind of fairly solid support in and around this area. We've got this line drawn. But my feeling is that probably this became a new significant level. If we can close below there today, then probably we're on our way back down to the 17,000 mark. We do have US earnings season starts in a couple of weeks. And I think probably going into it, there are going to be some worries that again, this strong dollar has affected international earnings. And the oil companies probably are still going to be sitting lower earnings because even though the oil price has bounced a bit, it's still at $60 a barrel, which is basically 50% of what it was a year ago. So I think that the energy and the more internationally orientated stocks are going to be hit by the stronger dollar in the week or oil price. And so there will be worries about that. And that could be enough coupled with Greece to send us down to the bottom in this changing range. And maybe that will happen. And then maybe going into earning season, if things start to impress some of the major names like Apple and Facebook, if they can come out with these earnings, that may be able to turn things around in around the 17,000 level. Now, we are running out a bit of time, although I did start a bit late. So we're probably going to run over time of the year. Let's switch over to commodities. Now, I think this just demonstrates the general weakness of gold is that we're only at .3% or $4 an ounce today. It's fairly minimal price reaction from gold given such a risk off day. So let's have a look at the chart there and we'll kind of see why. People just aren't acting too favorably. Now, you can basically see that the same line I've had drawn in since there. Foul to close below, pushed up to the top of the range here. A couple of spinning tops in and around that spot again and today we pushed higher. But we're just in this trading range. We're not. We're a sort of downward type sloping using this bottom trend line and the 200 day moving average downward type sloping. Range in gold. So there's get a few jolty days, but it's not really proving the ultimate safe haven at the moment. At least it is up today. People haven't been selling their gold alongside everything else they have been buying into gold. And we're seeing general safe haven flows in general. Dolly Yen, I mean, Dolo has been, has not really been sought out as a safe haven. It's flat against the pound and the Yen. But you can see, yeah, I mean, really, I guess the Yen has not been a massive safe haven out here either. So a lack of desire, just sort of selling but a lack of desire to switch into some of these safe haven assets. Now crude oil lower on general risk sentiment today. Let's have a look at the outlook here. To me, this is fairly critical. I think this trend line is pretty well defined in Brent and we closed below it for a couple of days last week. Not the most dramatic action, but today we're looking a bit lower. We're running into this support area. So to me, it looks like we're breaking down. I'll probably get rid of this channel. But yeah, first support broken, which is the rising dynamic support of the trend line. The next support that needs to be broken is this line here. And I've drawn this potential support, which kind of is through these peaks. But I suspect that if we do break these lows, that might provide a bit of temporary respite, but I suspect we've probably had an indecent amount lower down into this kind of support type here, which would put us at a sort of a low, that would be about $53 about, I think. Yeah, $52.50. I think we could be heading back down to $52.50 from there, maybe find a bit of support. But I move that much lower. We'll rattle the oil market. And people will get worried that this move high is over. And so if we get down to $52.50, there's a good chance that we'll just move through and test the lows as well. I don't tend to think my default assumption is that we're not going to break to new lows below what was the low 43, was it? 45 and change in crude oil print. I don't think we're going to break through there, but I do think sort of crude oil is just trading in a new range now. Okay, let's have a look at some of these currencies. Well, I mean, I'm not sure how many of you trade the bonds, but you know on a day like this, it's actually proved to be quite an interesting market to trade. The prices are higher here, and so that means yields are lower. So people are buying bonds, buying European bonds today, buying the German boom, buying UK Guilts, buying US Treasuries, and getting out of stock markets, obviously. You might think that really having Greece exiting the Eurozone would cause yields to spike. I wouldn't countries need higher financing costs when there's an associated high level of risk. Wouldn't investors want to be paying more in yield to take on the risk of dealing with Europe, which involves Greece? As it turns out, that's really not the case. People are still viewing bonds as a safe place to be in terms of thermal. So let's have a quick look at the Euro. Yeah, I have this kind of – I've just drew this as a dotted trend line before, and it's sort of worked. I mean, these things are not perfect, although we are seeing a bit of a bounce off there. I suppose probably more related to this general sort of breakthrough area here, maybe what price is reacting to a bit more. So we saw obviously a big gap lower in the Euro, just explaining this candlestick formation here. So this was a lower – we closed the mark on Friday here. We gapped a lot lower on Sunday as the news broke that capital controls and referendum in Greece, but today we're trading higher, and we've basically filled that opening gap from Sunday. So I think we have moved into sort of trading range type environments, so I wouldn't be surprised actually to see a move back down to 108.15 in the Euro. I don't think this turn line has too much merit, but if we can close above there, perhaps it does. If we can close above there today, which we are looking to at the moment, maybe we can get a push back into the highs. I've been saying that I think this is an uptrend, it's my last one here, but just the fact that we didn't move much – this is quite a sort of straight move up. We just about recovered this peak, so I've sort of been calling for yes, we do need a deeper correction first, perhaps down to where we had this little dip here, this kind of breakout area is potentially where we could see the correction end, but also a sort of confluence of moving averages and this kind of weekly demand area. We could get as low as that. But I think the trend is higher. It's a bit of a kind of choppy higher trend in the pound, but my bias is for long trades here. That said, I think it's probably heading lower from here, but it's hard to know when it would end. Just coming into the end of the session here, did break these lows here in the Dolly Yen. We weren't able to push through the spike here from June 17, and we've dropped back down, made lows past the lowest since 26th of May, so lowest in a month in Dolly Yen. But yeah, similar to Euro. It has this big open lower, but I've basically filled the gap, not as big a gap in the Euro as the Euro, but saw some initial safe haven demand for the Yen, but that's starting to get unwound in the major trading sessions today. Okay, I think we're going to call it a day there. I hope that was useful. Good luck with trading this week. We've got the non-farm payrolls, the ongoing Greek crisis, so there should be some good opportunities. I mean, this is what you want to see when you're trading. You want to see these 3% plus moves in equities, 1% plus moves in currency. That's how we can make the money with this kind of volatility. All right, thanks again, everyone. Jasper Law is signing out.