 Okay, very good afternoon. Thank you for joining us. It's Friday 11th of December. I am joined by our head of trading peers, afternoon peers. Hi guys. And if you are not familiar with Amplifier, I'm Anthony, I'm the head of market analysis here and I kind of oversee Amplifier Live, the trade hub, which is our kind of main portal where we house all of our community. So straight to business, there's been a lot of headline noise in regard to Brexit this week so very quickly to catch up. There's been a lot of expectation of continuous rollover of deadlines to be met in terms of deal or no deal for Brexit. This is just a big one on Wednesday this week. The pound, just a bit of context is off, roughly about 3% from where we were at the beginning of the month. And in regards to money markets now their pricing in I saw this morning peers. I'm just going to turn my score off. Money markets are now pricing in the probability of a 10 basis point cut of interest rates at the Bank of England by March 2021 65% and it was 16% at the start of the month. So we're kind of closing in, as most people will know the end of transition is the end of the month. That clock is quickly running out, and yet we're still seemingly stuck, although some agreements Lucy on things like Northern Ireland and and so on, and also pulling back a little bit on the whole internal market bill legislation, the three main sticking points still persist. So to give this discussion some direction. I want to divert going into any of the political reasons of why most people are probably still have the opinion of why there is going to be a deal and what this could lead to and the positioning and leveraging and why I just want to focus more on the actual trade implications of how do we tackle and focusing predominantly on the next three weeks of the here and now. So with that being said then, I'm just quite keen to hear what you have to say on your view on this new deadline that European officials and UK have been quite explicit to say as of today, where the pound is weakened again that Sunday is the last opportunity. What do you think is exactly comical. I mean we've had about 500 last opportunities already. So do I think this Sunday is the last opportunity. Firstly, no. Do I think this Sunday, they're going to do a deal because they have to because it's the last opportunity. I think definitely not. It rolls on into next week, but it rolls on to the week after, and it rolls on to the week after, and really the big deadline is the 31st of December at midnight. And actually even then, I mean, I'm not sure we'll have time to get into it on this call but I think it will roll on into next year. Yeah. Okay. Yeah, I mean I just very briefly I was reading a little bit about that because the moment I think a few weeks ago, a European official came out and said look, we can squeeze in a last minute meeting of officials European heads on the 28th of December. I was kind of convinced them while all the rest is noise till that point. That is in your calendar that is going to happen. But in an extreme scenario what I've read is that the European Council could in theory agreed to a provisional application of any degree deal would allow parts or all of it to kick in before then European Parliament actually vote submit but as you say there's an opening bit of cans of work but yeah I think phrase there is exactly right. Of course they can buy more time. Yeah, I mean that's the end and that's probably supports the notion then I mean pound on a chart I'm going to bring it up on a daily and you can see some annotations on that chart. Okay. Does that explain them why, although we've pulled back obviously this week, the market's still relatively high. It's still relatively high, but because of the fact that you know anybody who tracks these Brexit developments. And obviously the trading community will they be classified as an entity that tracks these Brexit developments will then no one, no one, no one, no one should be surprised with what's going on in terms of we're still at the negotiating table and we're still coming away from these negotiating set piece events and are there still a big gap and there's still a big divide I mean. This is how it goes right and I'd say that therefore we're trading up I know we've come off today and perhaps a bit more broadly this week but don't forget that last week you can see there on your chart last week we were trading and indeed making the highest levels on on on cable that we've seen since this quarter two of 2018. Now I know there's dollar weakness in the mix here but nevertheless you know the pound right now as it stands is not pricing in a disastrous economic cliff edge on the 31st of December. And I say there's two broad reasons why it's not. Number one is what I've just said in that. I don't think genuinely people have been expecting a deal to be done yet. Okay, I think there's still three weeks right. I think it will go to the wire and as I said, you know stuff they can change stuff they can go in. They can post but they can bump this into next year if they want. But that's that's one reason. Okay, I don't think necessarily no deal at this point is a huge surprise. I think the much bigger reason, and I don't think it's been getting much coverage. It deserves more. And I think that actually is this is this a big deal anymore. Perhaps the use of word deal there is the wrong one. Is this a big thing anymore. And what I mean by that is relative to COVID-19, the potential impact on the economy from a deal or no deal Brexit is actually now quite small. I mean they're talking about worst case scenario some of the forecast for next year is that GDP might drop but might be 2% worse off in the UK from a no deal. Brexit COVID-19 that had a 26% impact on GDP, and we're going to see a recovery from that next year and so deal or no deal. COVID is easily the biggest play in town when it comes to thinking about how the UK economy is going to perform thinking about how the Bank of England and the UK government might behave from a policy point of view and therefore thinking about how the value of sterling might respond. So that's one thing. The other thing on that. Why is this not such a big event anymore in my mind is because so much has changed since 2016. So much has actually developed and evolved for starters if you go back to 2016. The deal that we're hoping to get negotiated is actually a relatively hard Brexit. And that's because we're talking about leaving the single market and the customs union, right? If you go back to 2016 that was right up on the hard Brexit end of the spectrum. But actually that's now the deal that's trying to be broken, right? Number one. Number two, a lot's been decided already. I mean, you know, there's lots of, you know, like financial services equivalents has been granted for 2021. I don't know if you saw in the news earlier this week, but the UK have just negotiated a trade deal with Singapore and actually behind the scenes what's been going on as this thing's been kicked down the road and kicked down the road and kicked down the road. We've actually been able to now negotiate trade agreements with countries outside of the EU, obviously not with the EU, but countries outside of the EU and so that just reduces the kind of negative impact. And so my mind, why is Sterling not really reacting yet? I'm not sure it necessarily will react. Well, can I share my screen and show you my chart because let me quantify that. I think it can react. Don't get me wrong. I think there is volatility to come in the weeks ahead. But I want to get, I want to quantify what I think the volatility might look like. Now on this chart, I've got a weekly chart of cable so we can just pick out the, on the very left hand side, the actual Brexit vote announcement and the collapse. Let me just draw up some lines here because it feels like such a long time ago now, but we did hit 150 on the day of the Brexit vote itself. And then the kind of let's call it the double bottom of the aftermath was right down at let's just say the 120 handle and we had some key support here in the summer of 2019. Okay, really important that we bounced off that then obviously COVID created this violent situation back in March right so let's kind of just discount that for a moment although I will draw a draw a line here because this is important. And then over the last few weeks as we've driven up and we've tested this what really important handle at 135 which was the 2019 high reconfirmed August 2020. Okay, and now we're dropping because yeah all right, the 31st of December deadline is now nearer, and it doesn't yet feel like the two sides are coming together a sufficient speed to get an agreement in place by the end of the year. So I think you're just seeing this week, the pound drop from what's been actually a really elevated level so even though we've dropped off a few hundred pips here. We're still trading very much right up in the top quartile of the range that we've seen this currency pair trade for the last two years. I know we're selling off now the pants still relatively high and some of that is because of a week dollar I get it, but where, where can the pound go here. And I think there's two scenarios. We either get a deal. Okay, but bear in mind that's still quite hard Brexit, we either get a deal and what happens there. I can still see the pain devaluing off the back of the deal, but just not by very much. I think if we get note that the worst case scenario where it's an acrimonious fractious acrimonious trend in these talks into year end to the point where both sides throw their toys at the pram and storm off home. The worst case scenario right and that's like your two and a half percent hit GDP next year. So they're here, obviously the pounds going to drop. And I tell you the 115 handle is what everyone's eyeing up as a potential possible worst case scenario biggest move. Yeah, that's the COVID law if you like, there's a big support of 120 before we get there, which is that historical low from the Brexit negotiations on the 2019 summer 2019 to 120 is massive, and then 115. And so, I would say, acrimonious breakup of talks at the end of this year and you're going to get the pattern down to 115. You know, how quickly does that happen. Well, it depends that can happen over the next few weeks. Obviously we're tracking how the negotiations go. We could get a deal on Sunday right but I think the chances are small so they'll kick the talks into next week. And it's like, how far apart the sides. There are any side of those that division reducing and that division has reduced this week, just not by as much as people were hoping, right but the two sides have inched together. And so as long as that continues over the next few weeks where there's at least an inching together, and I think the pound is going to be, you know, you might see more mild negativity going to the 130 handle. Now, if in the next few weeks, what happened this week where we've had a mild move together, if that actually now backtracks will find the pound is going to get impacted more violently. And we're going to get breaking 130 and, you know, key levels, like 12679 was the summer low. And that's kind of key resistance area through quarter to quarter through. Sorry. Yeah, quarter to quarter three. We might get a move down to 12679 if the progress, the small progress made this week unravels next week. And so that's it it's about the direction of travel of these talks, and are they, are they making small concessions at the very least, even though we still might be a decent distance apart. So if there's continued small concessions, they're not only the pounds going to get much below 130. If we reverse them we're down 12679 then we're down to 120, but that's the only way we're going to get to 120 in the next two weeks as if the talks really take a turn for the worse which I don't think they will. And the 31st of December becomes your line in the sand. And at that point, yeah, either they agree, an uncooperative no deal of fine then you're going to get the pound down to 115 and maybe even below, or they come up with a cooperative deal. And I think the pound hangs around 125, maybe between the 125 130 channel depends what happens with the US dollar perhaps as to where it kind of goes from there. You're on mute. So just to jump in there is. I mean look like this gives a great reference point for for as we discussed the period of of the next three weeks, and perhaps even beyond. But within the community. There's a lot of the guys on Amphile live who are trading day trading. Yeah, now, having obviously, you know, day trading for many years yourself in this type of situation. Like for instance, there's been a day this week when Sterling's down 200 plus pips is down 117 as we talk at the moment. What's your kind of advice around execution in a headline noisy environment risk managing in that environment. How would you go about approaching that. Like when we're getting, when we're coming towards a deadline, then volatility increases. Now, that just means you've got to be savvy to that and you've got to understand that the risks involved with you trading go up as volatility increases. And therefore, on the one hand profit expectations rise because when you're getting into trades, you know you're not looking for 25 pips, you might be looking for 100 pips in a trade. And so be careful there because often people don't quite talk about profitability side of volatility, because one one track, a lot of people will fall into is they get a good trade on and they take it off for 25 pips only to then see the thing move another 75. Now you made money, but you feel like you've lost all that profit that perhaps your trade deserved. And then this can kind of trigger a very negative reaction where you then try to make up for that lost profit by gunning back in and expecting irrationally expecting another 100 pips and then you get chopped up and it gets messy. So you end up losing money, because you took that first trade off for a profit too early. So I do understand that your profit expectations should increase but then on the risk side you've got to be, you still got to risk manage yourself very tightly, you know it's key to not lose discipline. So if you're in a trade that's going wrong, you've got to be super disciplined because in the end, any one of these trades could be a massive few hundred pit move that could absolutely kill me. So you've definitely got to be super disciplined. Then it's about headline risk. It's about technicals. And so it's about understanding where can I get my ear to the ground, you know, is it whatever, Laura Koonsberg on Twitter or is it Anthony Chung in the hub, for example. And it's about getting the news first, or at least in that first wave and it's understanding that right where are my technicals, how far from this market moving and actually being aggressive with getting on it. And this is that difficulty with differentiating, you know, news what's important and what's not. But it's understanding the one that's important and it's understanding right that's going to trigger the move I am going to be on and trade that and then it's about, you know, just simple. I think keep the technicals quite simple in this case because it's in the end a macro driven environment. So I'm just marking up big support and resistance levels like I've got on my chart here. And you know like this morning, you know it's like firstly aiming for that low from the day before and then it's obviously recognizing the lower the week and then making that judgment that right this news is significant enough I expect to break off these levels. And of course we're now down into a bit of new territory if I just extend my chart out a little bit because then we're looking at, you know, price points like back here which was the, you know, key resistance and support and because so we're down around there and then you're thinking about the big handles and so on but it's definitely about headline risk and about understanding where to get the news from understanding which item is the significant one to pull the trigger on. It's not just about having larger profit expectations but still being disciplined with risk. And just to kind of add to that point from from my side of things given what I do, which is news aggregation if you like, and my job is then to assist in that area and that's a couple of questions I normally get in that regard is kind of, you know, and, you know, why don't you trade, you always get your finger on the pulse. The idea is to have my finger that on the pulse requires me to be 110% focused on the matter at hand to, to then help capture that information, hopefully in a timely enough fashion, where someone like Pierce or the rest of the community can then take advantage of it or at least do that, that digging around a lateral thinking about trying to find other ways of where news could come from outside of the standard kind of financial newswires and that's one of the final points I wanted to say was that this with a subject like Brexit, you need to understand that it's, it's a political thing that we're monitoring. And so therefore financial newswires like a Bloomberg or Reuters, as expensive as they are, they're terrible at reporting this type of information. It's just not their bread and butter that the information on Brexit, as it has done since 2016 comes from journalists who communicate in real time via Twitter. And so that's where, you know, say this weekend, for example, if you go right under the microscope, obviously, a lot of traders will look at how do we open on Sunday night in electronic trade for example. Even when we're likely to hear, most likely they've not made any progress on this newly committed deadline as soft as it might be on Sunday, there could be a gap in prices. So all of that information will emerge from these alternate sources and certainly that's where I think that, you know, we can obviously give advantage to our guys and hopefully the community amplify live but I'm going to start recording. If you're watching this on YouTube, after it's taken place, we're going to then continue now a full Q&A. There's been a number of questions coming in from the, from the guys in the Amphi live hub. So we're going to tackle all of those now will stay on. But if you'd like to check that out, then remember to check out the link in the description below, if you want to get access to the full recording. Thank you very much.