 Hello, welcome to CMC Markets on Tuesday, the 28th of April and the weekly market update. Now last week I looked at the German DAX and I looked at the pound against the dollar and we're going to look at them again in the context of what we talked about last week, i.e. the prospect of a sterling rebound against the dollar, which we have seen. And also the possibility that maybe we've seen a significant reversal in the DAX. Now over the course of the last week or so we've seen new multi-year highs on Asian markets, particularly the Nikkei, which has managed to push above 20,000 for the first time in 15 years. And we've seen eight-year highs in the Chinese market as well. We've also seen a new record high on the FTSE 100 and we've seen a new record, marginal record high in the S&P 500. But we appear to be broadly range trading at the moment. And I think there's a certain amount of concern that possibly we're pushing at the upper ends or the upper boundaries of the gains that we've seen so far this year. Now why would that be? Well, I think it's largely as a result of the fact that pretty much most of the central banks are pretty much all in when it comes to quantitative easing. And really now it's a question of how much further upside is there given the fact the market has already front run a lot of it. And it's also an awful lot of uncertainty with respect to what the Fed is going to do over the course of the rest of this year. Now we should get some color on that or further color on that at the latest Fed meeting on Wednesday. I think it's unlikely that we'll get any further clues as to the timing or otherwise of an interest rate rise. I think the real big question is, will the statement be dovish or will it be hawkish or will it be neutral? And if it's one of those, what will the effects be with respect to the US dollar? Because the US dollar does appear to be showing a significant amount of weakness. And I think there is a school of thought that perhaps we've seen the highs in the dollars or seen the high in the dollar rather. And in that context I'm also going to have a quick look at Euro dollar as well and look at some of the key levels there. So let's start off with the German Dax. Now a couple of weeks ago we posted a bearish reversal candle on the weekly chart. Now if we look at this daily chart that I'm slinging up in front of you here, we can see that we've got a significant area of support around about the 50 day moving average. We've also seen the Dax struggle to really get back above the 12,100 level. And I've drawn a horizontal support and resistance line through the reaction highs after the push lower from the April highs. If we then move on to the four hour chart, you can see that in slightly more detail. And you can also see that we do appear to be trading in a little bit of a box range. The bottom end of that range is around about 11,600, which is pretty much where I've drawn that lower line through the lows that we put in the week beginning the 23rd of March. And the highs that we put in the week beginning the 20th of April, i.e. last week's highs. So for me that range should define where we go next with respect to the Dax, bearing in mind that we posted that bearish weekly reversal, the bias I think remains for a correction lower. And in that context, we can probably look at that through, we could use that as a prism for the next move in the S&P and the next move in the FTSE 100. Now the FTSE 100 has found support around about 6,980, that was the lows last week. So keep an eye on that level there. And also keep an eye on the S&P 500, the support below 2100, around about 2085. So the rest of this story is pretty much a dollar story. It's a dollar story against the euro and it's a dollar story against the pound. Let's start with the euro. Now obviously the main focus is really what's going on in Greece. The likelihood is we're going to get some form of default restructuring or what have you. It doesn't appear to be impacting too much in the euro and I think that's largely because the market is so one way in the context of where they think the euro will go next. Now I think that's a mistake and we're going to look at the four hour chart here on the euro dollar and I'm going to look at the channel that I've drawn in from the lows at 105.20. Now that 105.20 support line currently comes in around about 107.20, 107.30. The key level on the top side remains at the FOMC spike highs of around about 110.5. So 110.5 on the top side is really the key level on euro dollar on the top side for any further gains but at the moment it's pretty much like we are in equity markets. We're in a little bit of a range. The big barrier on the top side is around 110.5 and on the downside we've got the trend line support from the 105.20 lows. We'll finish up with the pound against the dollar. Now last week I talked about a bullish engulfing week on the weekly chart and the potential for further sterling gains despite the fact that there's an awful lot of uncertainty about next week's general election outcome and sure enough that bullish engulfing week we were very wise to pay attention to it because we've seen the pound push above 150 and the likelihood is I think we could well see 155. Why do I think that given all the uncertainty and given all the concern about a potential hung parliament or simply speaking I think everyone is two one way and this is not just a sterling story it's also a dollar story. So we look at the daily chart we look at the break higher the support now appears to be coming in around about the 50 day moving average which currently comes in around about 151.60. Below that around about 150 which was the original breakout point here and we can really see that borne out in the four hour chart but I'm putting up in front of you now we've got trend line support coming in from that low that we saw in the week beginning the 13th of April and again that sort of converges with the downtrend line that we broke above on the previous chart which I drew in from the highs that we saw in the middle of last year. So we can see that we are ratcheting higher yes the oscillator is very overbought but always remember whenever an oscillator is overbought doesn't necessarily mean it can't go higher you have to trade with the underlying trend and what we're seeing at the moment is we're seeing higher lows and we're seeing higher highs until that pattern is broken then the likelihood is we could well see further gains in the pound against the dollar. At a moment we're capped around about 153 we can correct all the way back to 151 but overall as long as we stay above 151 the likelihood is we could well see a move to 155. So that's it for this week once again thanks very much for listening this is Michael Houston talking to you from CMC Markets.