 Okay, very good morning Tuesday the 18th of February. Hope everyone is doing well It's just me on the briefing this morning So what my intention is is I'll cover up the or cover over the news in a bit more detail I'll give a bit of a view about what's happened overnight and how the charts look this morning And then perhaps after the briefing Alex can jump on and add a few more levels that he's looking at across different products in regards to the technicals But this is kind of the big headline that people are looking at this morning if you haven't already Caught it. Well, let me just get you up to speed. There was news out overnight Apple saying that it does not expect to meet its revenue guidance For March quarter because of work slowdowns and lower smartphone demand in regards to the virus outbreak in China is taking a bigger Toll basically on their predictions and they had originally anticipated the company which obviously a lot of weight is put on the iPhone given the Proportionate sales that that makes up for the company and given the fact that that manufactured in China. That's where the problems are lying It's temporary Temporarily constraining due to production ramping up more slowly than anticipated They said back in January Originally that the guidance was that factories were going to be reopening beginning February 10th But as we've seen with how the Chinese state have been looking to Kind of control any further outbreak of the virus by Slowly drip-feeding workers back into factories for example And so that's been has had a knock-on effect for Apple now why Apple's had such a Big reaction for just generally markets across the board You can see index dot futures down a gap down overnight If let me just have a look at the S&P here just to make it a little bit more clear So Yeah, there's the gap down You can see an incredibly tight range that was seen in yesterday's session as you would expect given a US market holiday Wasn't here in the afternoon, but I did have a glance at the P&L's and some of the new traders going live yesterday I mean obviously wasn't here to see every trade that you did But I saw quite a lot of activity which I thought was quite unusual For the fact that US markets were closed So again when we've gone over those kind of judgments of market sentiment market conditions sessions that I've done with you Just be Reactive not every day is the same and definitely when there is a US market holiday You can see from the type of range that we were trading in the S&P there very narrow and restricted and respectful of levels Given the lack of real market participation in those types of sessions here though You've got the gap down and we've had a little push in the S&P Down towards what would have been Friday is low before the bounce came and the kind of ramp into the US clothes if you like and so even with the S&P and I'll just have a look at other assets first before I give my broad kind of view about what I think about this recent move This morning, but I think there is a little bit of a danger if you're a new trader coming in this morning And it's a little bit of FOMO almost. There's been big moves overnight You've seen oil down equities down T notes gold bid and then there's quite a tendency I think to just come in this quite blinkered and quite narrow focus and just want to hit that continuous trend But the majority of the move I'd say probably has already happened for this morning And when the US come in I think that's when it's going to be Potentially then the next phase of the move and it's not our place to Speculate whether we think well This is the entry point now for the low to get long again or whether to get short for the secondary phase of Continuation of the move. I think just plan accordingly just be patient and wait and let's see how the market unfolds and then look to act Accordingly here though I mean even if we did if we were looking at the day as a whole and we did come further down I still think that you know given the fact that you know, just put it into a little bit of context for a second The S&P is was trading at record highs. So a little bit off the top I don't think is that big a deal to be quite frank and it doesn't really change the Apple situation What I feel generally and if we did come down and let's say The next kind of levels here to be looking out for would be around this kind of area Then on the intro they daily pivots you've got the S2 and then you've got the next level of the lows here Which bring in that low point we had back on last Thursday. So if we did go lower down, I still think there's decent areas underlying strong support and this equity market Irrespective of the bump down that we've had Overnight the other asset classes generally what we're seeing then WTI crude following suit with the general kind of risk off That we've observed in the overnight session. You can see that in the short-term price action the S1 Providing a level to watch you can see we just broken through then what was Friday's bounce pretty similar mimicking the equity move that we had late on The evening on Friday and then the retest that we had in the overnight session the eventual break and you've seen came Back up to test around that level and it's had a bit of a another push down now looking at the The technicals here just responding to some of the previous lows that we've seen in the overnight session going back from Thursday to Friday Last week and you know on the much longer time frame Again, I'd say we've kind of now Got our new range for oil for the moment, which is basically around If we just stick with that same chart we've had marked up for a while It's this kind of activity between 52 76 and then now the low Seen around 50 58 which would bring in those summer 2019 lows that will be quite key for the range I think in the near term over the coming session or sessions If you want to look at it that way Currency markets very quiet not really moving the dollar index is basically flat So currency pairs really not as interesting As some of the the size of the movement seen in the other asset classes I was just having a look at gold obviously has broken a little higher We've got above the high print that was seen in The overnight Asia-Pacific session that with the trendline break with what I was just looking at here of the last week's price activity so a brief flirt and test of the R1 But we've managed to just come back down with settling around that same technical point of significance So again any continuation of further run up in gold Well, you'd want to be seeing a continuation of the risk off move and at the moment That's not really happening if anything Right now as we speak the market Just reversing some of those overnight moves albeit I'm just seeing starting to see now a little bit of currency movement as cable just ticks down a little not forgetting We've got the first of the batch of UK data coming out today So yeah, Apple was the kind of catalyst if you like but the longevity of that moves There's a couple of points. I just want to stress one is this is kind of corporate strategy one oh one Apple getting any type of negative news out there as soon as possible It's kind of a way of just dampening the effect then when actually released their physical numbers come the end of the quarter in March so it's quite a prudent way of Mitigating any kind of build-up and subsequent lesser shock in their share price So this is quite quite typical The fact that the company can kind of blame it on external circumstances. I think would be quite actually warmly received So I don't really anticipate even if there is some intraday reaction too much in the way of a sustained impact on Apple shares If anything, I think they've kind of cleared the slate now and they've eradicated what would have been quite a big Negative for the stock so again when they open it would be quite interesting as a point of reference Apple is about 11.6 percent index rating of the Nasdaq Seven and a half percent index weighting of the Dow and just shy of five percent of the S&P 500 Remember those top companies when we talk about Amazon alphabet Apple Facebook, they literally comprise of About 20 odd percent of the entire S&P 500 So when you do get a kind of revenue warning like this from Apple This is the type of shock that you see in markets in the short term Okay, the other equity news story you've probably seen this morning is HSBC Just having a look HSBC shares opening down about four percent this morning So it probably added to a little bit of the tailwind overnight not only with Apple reaction, but the subsequent Supply chain of Apple was all down overnight in terms of some of those Asian names HSBC shares lower They've also opened lower in London this morning The summary here is they're going to slash about 35,000 of its workforce over a period of a few years They're going to take a seven point three billion dollar charge and They're targeting cost reductions of four and a half billion at its underperforming units in the US and in Europe So yeah quite a severe shake-up and kind of a refocus of the firm to kind of cut off Underperforming parts and look to focus on Asia, which is kind of real the core to their business in that respect So that also probably getting a bit of attention this morning Just before I move on I can talk about the RBA minutes I mean the reaction now that we're seeing in equities is the exact point that I was kind of referring to You can see now the DAX very strong bounce We've just seen to the upside back up reverting pretty much the entire drop that we've seen when Europe came in US equity index futures following suit. So this is what I mean about You know when you're a new trader I understand it can be quite compelling you read all these negative headlines You see the reaction in Asia in the futures overnight when you feel like wow I just want to hit it and you feel like well I wish I was in at 5 a.m. In the morning But this is where it can be quite devastating Because you can get caught short quite badly and you get squeezed out of your position So you know again, it's about you know being quite considered and being realistic and rational about the opportunity at the time When then you're in the marketplace So as I said this Apple thing, I don't really see it being too much of an obstacle The other thing of course that people are looking at is the corona virus There's been an additional 1868 cases overnight 98 deaths, but 1700 people or patients have been discharged so Yeah, as much as that's still something to be monitored. I don't think that those numbers are really that Surprising to be quite frank either Moving on then let's have a look at the RBA. You've probably seen that Aussie has dropped overnight So people obviously still monitoring the performance of the Asian indices of which Local markets and Hangsang and Shanghai composite were a little bit lower reversing some of the upside than yesterday But the Aussie weaker because we had the RBA minutes come out overnight Now to keep things in a summary form The Australian Central Bank minute showed that the members in their discussions Reviewed the case for further interest rate cut remember it was there was some prospects that potentially they could have gone for it They didn't but it was under discussion and that in itself alone Was enough to kind of give the queue to the doves to bump the Aussie a little lower overnight They expect the corona virus outbreak to subtract from growth in exports over the first half of this year They acknowledged though. There's difficult to assess potential indirect effects on activity at this point They maintain their easing bias Riterating its expectation rates will likely stay low for an a quote extended period But the bank retained a broadly upbeat view of the economy's prospects and so Yeah, all in all a slight dovish Reaction seen in the in the Aussie overnight But if markets start to stabilize perhaps then that provides a bit of a flaw In regards to if calmness kind of returns and is restored in respect to the outbreak of the virus In other headlines, so this was the RBA Just wanted a quick word on the trade Negotiations between the US and China quite interesting things obviously Happening at the moment. This is kind of taking overalls a subject matter a bit of a backseat Just given the emphasis on the containment of the virus But China said yesterday that it would accept applications for new tariff exemptions of nearly 700 products imported from the US including key cultural energy products such as pork beef soybeans liquefied natural gas and crude oil now So that was quite interesting obviously China Looking to almost offer the olive branch the Exemptions of the third and most substantial set to be granted to date by China since the start of the trade dispute It's one of those things now where China really doesn't have much else of a choice Although they can and they will ramp up their fiscal intervention if you like and monetary support in the market They also do not want a additional layer of pressure from the tariff man On top of already that the impact that the virus is going to have on their economy So they're looking to kind of ease back Make exemptions ramp up then the key imports from America, which is agriculture and energy products Hoping then that that appeases the Americans then to keep things relatively passive on that front However, quite the opposite if you're looking from a Trump yesterday He was talking about the US considering a new wave of China tech restrictions looking at possible bans on GE jet engine exports the US quite afraid of basically the Chinese receiving Receipt if you like of the engines and then reverse engineering them to then steal the intellectual property of There's engines and then Huawei also always in the spotlight and some talk about Huawei steps being mulled as well Decisions are expected towards the end of the month at cabinet level meeting on China. So Yeah, one one to be watched definitely if if the US do start becoming a little bit more assertive and aggressive again on China I I personally don't see that being the case because of the situation China finds themselves in I think Trump's gonna get kind of what he wants, which is this one I mean if China do start making more exemptions. Well, it's kind of a win-win for Trump He just makes a couple of noises, but doesn't actually follow through about more restrictions and being tough on China But at the same time China does everything it can to live up to its phase one trade deal and goes a step further by making The third and most substantial set of exemptions granted since the trade war began So again, it's another win for Trump with the underlying domestic economy starting to perform a little bit in terms of recent economic data So again a lower risk for markets more generally Quick look at the calendar. What have we got for today? Well for this morning UK jobs data kicks off that sequence. Remember, you got the jobs data from the UK today You then get the CPI Wednesday, you've got retail sales then Thursday industrial manufacturing production end of the week So quite a busy week. Keep an eye on cable It is trading a little underperforming this morning down about 56 pips Testing is s2 already this morning as I said Alex can come on after me After briefing and talk over some technicals a bit more for those interested European European data, you've got the German ZEW figures I wouldn't be looking at that to be the silver bullet if you like for dictation of European asset class movement for the day, but certainly something to just monitor and then going into the US session There's not really a great deal of major US economic data We've got the New York Fed manufacturing number at 130 But I would say the bigger emphasis is going to be on the US Interpretation is some of the latest news that's happened overnight with Apple and with the Developments with the virus, but as I said, I still feel fairly Confident that the market will swallow the Apple news relatively comfortable comfortably But even if we did bump lower, I still think that then the in terms of equities will find some strong support lower down speaker-wise ECB's Panetta He's speaking at 145 Fed's cash carry the most dovish member on the FMC is speaking at 7 p.m This evening you do have a shat auction coming out of Germany for any Fixed income traders and then from pre-market US earnings today one to look out for is Walmart I'll give you the full rundown ahead of the release and the times But it's going to be a few hours time. They are respective 2.7 percent of the Dow So one of the bigger components Alright gonna leave it at that Let you guys get cracking And I wish you a good day ahead. I'll be in the chat room All morning, so any help that I can provide just let me know and I'll let Alex come on in about 20 minutes time or so and you can cover off some of the charts and setups for the day. Thanks very much guys