 Okay, hello and good morning. It is Friday the 27th of March. I hope everyone is doing well I'm not sure if you were Based in the UK, but last night at 8 p.m. The the clap for the NHS one amazing Service that these guys provide and it was just amazing to see everyone Given this unprecedented situation all coming together. So I hope that Made you feel a little bit better that you're not on your own in self-isolation in that one way, but yeah, absolutely and and thank you very much for all the well wishes from yesterday I can't say that I went out and had a big birthday bash. It was probably the most unexciting birthday yet But all good as long as we're fit and healthy That's all we can ask but having a look then into the briefing this morning and we come at it at a very interesting time actually and First of all, let's just recap what's happened and then we'll talk about what our views are going forward for the session ahead Because I think we're in for quite an interesting session to finish the week for sure And this is the the first graphic to the side of me as you can see here And what we're looking at here is a chart of the S&P 500 Year-to-date and we're looking at the percentage fluctuation Essentially so here you can see on the axis on the left Zero plus percentages five ten percent negative five ten percent and you can see we started the year obviously even though we had things like The tensions in the Persian Gulf We had the phase one of the US China trade deal your coronaviruses is certainly being the key The biggest market move of this far despite there being lots of macro themes that we've had to tackle in such a short period of time in Q1 and one of the things you can see here though was we're going through this pattern of massive big swings big Updays followed by big down days, but the last three days in fact if we look at the S&P 500 It's the first and bet was the best three-day streak. We've had in terms of percentage gains since 1933 April of that year and let me just bring up the S&P chart here because I do think We need to talk about this a little bit From that perspective This is the the chart of course from that tells the story of the week Let me just bump it up a little bit so you can see all the details here So you should be able to see that now So you had the Fed obviously do their their measures right at the beginning of the week short-lived But then the kind of rally The US stimulus package looking like it was going to go through and ultimately did through the Senate And then we had that biggest one-day rally we've seen in the best part of 1890 years But if you actually look at the percentage move that we've gone throughout the week It's pretty incredible doesn't look like a great deal on the chart here if you were ignoring the The kind of price levels on the right-hand side, but if you take the actual low of the week to the high We are up about over 21% at the high from low to high and we're still up although We've come off a little bit, you know, it's still 1920% so quite incredible really and you know one of the obviously Anomalies you could say from a theoretical point of view We saw the jobless claims number come out of the US yesterday and the response in the market was a meaningful rally You know I for one been talking about this for a while. I just thought you know, it's been so overhyped You know, obviously taking and looking at this objectively It's not a good thing first and foremost people losing, you know, a large amount of layoffs then creating this massive spike initial job This is not a good thing obviously But from a markets point of view, you know a number into the three millions wasn't as bad as expected There's as strange as that sounds and as record breaking as that number was, you know City was looking at four million We were talking the briefing about any downside catalysts and equities you would need maybe five plus million And obviously I didn't materialize and also I think that the accuracy of this data is going to be particularly bad So I think for me with jobless that figure alone Really isn't what I'm looking at economically and certainly I don't think central bankers Well, it's going to be well. What are the subsequent weeks thereafter look like? I think that's going to determine more what this overall Kind of picture and how bad it's going to be and then the employment situation in America So, yeah, I mean equities Continues to bump higher and we found it We know we're trading a bit of a flaw at the moment You can see here if we look at the S&P 500 on a slightly longer timeframe to encapsulate going back to This 16th then you can see we've got that range kind of high that we had that double double kind of top Right on the 16th 17th three we tested it and and it worked well on the 25th And then it's acted as a nice support area both in yesterday evening session and also first thing European morning So I'd be looking at that As quite a key zone These kind of levels have got marked up here the kind of 49 to 40 type levels and he break below there I think then could open up a more deeper move back to the 2500 handle if we were to get that today Otherwise, I think then just playing that that range accordingly. You've got the 26th handle pretty much matches to the tick You can see oh one was the high if we're looking at this near-term price range seen since Europe has come into the market And then you've got the prevailing high that was seen from yesterday, which was up at 34 and three-quarters in the S&P Having a look elsewhere because full of kind of stats today Gold is headed for its biggest weekly advance since 2008 Let me just remove my video camera. It'll be easy if you guys to be able to see everything there So just give me one second here Should be able to remove it Okay should be easier say so here. We're looking at gold And again gold has seen a quite quite phenomenal rally again, you know if we go from the beginning of the week type Price movement going from the 23rd up to the high looking at a 13 14% rally The price is coming up to find quite a natural point of resistance on the week that being from the beginning of March As you can see here on a slightly longer time frame looking at the year-to-date price action But looking at where we are at the moment again similar pattern to kind of equities seeing that bit of a bounce Since they've come into the market and you can see here. I've got marked up with a few ellipses already These previous points of resistance. So the gold market has found around this 1612 level in the futures and if you overlay that then with the daily pivots today, you also have The 1609 is the s1 today. So again, I'll be keeping eye with that range kind of a similar play for Gold as it is the equity market as the downside key levels that I'd be looking at any flush through there Then I'd be eyeing at around the sixteen hundred dollar level which then starts to bring in For just market up. You've got that high here going back on to the 13th These areas here as well on the 24th before that quite powerful move higher that we had So that's that's gold is backing off a little bit though at the moment Just given the extremity of the move that was seen in yesterday's session And again, just just showing those big rain ranges in which these assets have been trading With that the dollar has is is also been Moving quite a bit the dollar index headed for its biggest biggest weekly retreat since 2009 obviously as the Fed have come in and offered more and more support That in itself, although the Dixie training a little firmer this morning Perhaps right for now a little bit of profit-taking on those dollar shorts But quite interestingly from a cable perspective We were talking about this yesterday when we were looking at the much bigger picture in Sterling and how important the close back above that 120 was going to be we're looking at the weekly chart here If we looked for last night, we certainly did close above firmly that level So I think that's quite a good signal for cable for the moment And so I'd expect that 120 now to act as a pretty decent floor going forward Now we've managed to get above as you can see here It's such a substantial level of significance that we had on initial break But now having got above there it should work the same way and here again a really nice rally We've had over the last 24 hours to break that trend line We were looking at this time yesterday and then taking out those previous highs seen midweek And that's just helped to accelerate the price movement back on the upside. So as we pull back down I guess just going to be looking at these other levels as we were kind of rising yesterday as As areas to kind of fade this move back down Euro dollar likewise just given some of the dollar strengths. We're now seeing As I said, perhaps just a bit of profit-taking on those those dollar shorts Then just resulting in a bit of a pullback for the Euro currency first thing this morning You've got that those previous highs here kind of just around that pivot level Probably an area to have a look at if we continue this trend around here You can see that previous high as well here If I just remove here and then just following the move back down really if the dollar continues to remain strong And these other areas you can see quite a nice area where we've had support and resistance as we're Initially, you can test the break quite a strong candle there on the the 90 minute I'm looking at here so slightly higher time frame and then for that bit of volatility Through some of the initial Data releases, but then another push up there. So that would be key levels to look at so you've got the That previous high on the 18th to pivot then you've got the 110 handle on that area there Is what I'd be watching if I was looking at Euro dollar today The crude market as well I just want to have a quick look because then we'll get stuck into some of the news This this chart actually remains completely completely unaltered. This is exactly what we were looking at yesterday I haven't touched anything here But you can see what we were looking at was the respect here of this range and hence the reason We've got these rectangles and then we had already had marked up here to keep an eye on this And it's pretty much what looked exactly timings-wise as we had marked out You had the initial break of that that range low The markets then come back up to that around that same area and now I guess the question mark is we started to Look a little heavy this morning albeit minor positive territory But do we come back down? And if we do then be eyeing that low on the 23rd seeing how it reacts around that level and potentially then it depends What happens if we see a bit of a spill-off into the weekend equities come under a bit of pressure I'd expect a fairly correlated moving oil And then if we start breaking through some of these key levels on the reversal back in the S&P and other stock indices With those breaks and these levels in the the crude market. I think definitely we could get back down there But those those dominoes would need to fall in that way in order to get that type of price movement I would say and again, I think Rather than from a calendar point of view I do think it's a bit more of a sentiment point of view and I guess that does somewhat cue us up then for What we're looking out for for the day ahead So let's have a look at the coronavirus just gonna refresh this to make sure let me just change over my screens Just want to make sure that We're all up to speed and one of the key things of course that people are talking about this morning is the fact that the United States of America now have more confirmed cases than anywhere else on the planet So in more than China and more than Italy now that might sound Like quite a frightening prospect, but you know remember we were talking about this yesterday It was inevitable the US was always going to Supercede this and I would expect that number in America in the coming week to probably get well into the hundreds of thousands So that's not I wouldn't say on its own an immediate trigger to sell But you know a couple of things here to to think about this is looking at the covert 19 cases now surpassing China Perhaps this makes it a little bit more clear You're looking at a death rate certainly higher in China and a ratio point of view But the idea here being that China were very strict at looking to Contain and delay if you like the the virus whereas the US has been fairly slow to that Certainly starting to step up now and definitely one thing I'd be looking out conscious of going forward Particularly not just today, but into next week as these numbers will definitely go north in America is Further travel bans further restrictions kind of like what we've had to now put into place in the UK in mainland Europe It's kind of more Forced self-isolation staying at home only going out for emergencies these types of measures But being instead of just a New York issue or a San Francisco issue It's gonna be you know nationwide and I do think that that is coming and will that then create you know The idea that there's going to be more layoffs and probably what anticipates at the moment You know you think in the three millions is bad wait until you see the five million type numbers start coming in and on a Consistent basis these could all be things that could act as a trigger point then For another kind of renewed run on the downside because a lot of people still thinking that well, you know There's still a prospect here that we haven't quite This you know found the the magic formula that yet in terms of whatever it takes on the government central banks And I still think on the balance from what I'm reading Sort of tipped on the more bearish side. I'd say is still the prevailing thing for the time being This is New York obviously new cases in New York state have doubled In five days so you can see the cases here stacking up pretty quickly. So that's what I'd be Kind of looking at as well as we talked about before these areas in New York, Madrid and the UK are kind of the real hot spots And then India as well. I mean India The numbers are still relatively low. We'll have a look at those in a second But the RBI much in a similar fashion to what other central banks like the RBA the RBNZ The Fed the ECB the Bank of England have tried to get ahead of the curve You know that this economic Implications of this are coming. It's just a matter of time. So they've looked to basically unleash 50 billion dollars worth of liquidity They've slashed their interest rate. I think they cut it by three quarters of one percent. So again, not unexpected But India obviously another key one to watch is pretty much in that Initial and then acceleration just coming into the acceleration phase now if you remember that kind of bell curve We were looking at yesterday here's a new COVID-19 visualizer That you might find useful the numbers do correlate pretty well with the John Hopkins live monitor that we have been looking at But one of the easier things to look at here is you can obviously I can just pick where I want to go on the planet And let's have a look at India. So India you can see the numbers are still incredibly low at this point in time So in terms of the actual amount of cases, you know, less than less than 700 But again, I'd expect that well into the hundreds of thousands Unfortunately in the coming weeks Is India the kind of the key for trigger point for a renewed sell-off? No, I don't necessarily think so I think America is much more important. You know the more Strict the quarantine measures that are put in place on a nationwide basis the more impactful That's going to be on the economy and therefore the more pressure I think that you could see on equities if that was going to be the case But yeah, if we spin it over to the states, you can see here Obviously these numbers on a day-by-day basis So this is looking at I guess the last day cases up about 170 deaths up six at the moment Another thing that's that was also I thought quite interesting and I'll share these links with you if you're interested This is a COVID-19 global news monitor Now it's being done by a company called Raven pack And I remember talking to Raven pack. I think it was back in maybe 2009 2010 So this was quite immediately after the financial crisis and obviously my job traditionally is being I basically monitor lots of different new services and My ability is to then aggregate in a quite a manual way through my Experience and my knowledge what I feel is going to be important for markets to then relate to you guys as traders So Raven pack what they wanted to do initially just to give it a bit context is they wanted to make a machine readable news and basically wanted to replicate my Process or my brain in terms of having a machine do it in the idea that that could then outperform What we were doing is analysts on the desk Didn't didn't really take off. I remember Reuters running a machine readable service And they would using a sentiment scoring system to depend on certain words and things like that But obviously It's a tricky thing and I'm sure one day some sort of AI bot will put me out of business But I'm alive and kicking for now and what what was quite interesting here on this global news monitor Was a few different things you've got news flashes So perhaps quite interesting because it aggregates a lot of different news sources But specifically talking about the coronavirus so it can be quite useful to shortcut rather than going through all the different kind of press publications But some other cool things they've got here are media exposure to coronavirus The one I was quite interested in there's not so much the case updates I prefer to use the the John Hopkins one for accuracy sake because most of the mainstream media is using that as its benchmark But here you've got something called the panic index and I thought this was quite interesting actually This was looking at basically it creates a value range between zero and a hundred And it's looking at a percentage scoring then the higher the index the more references to panic being found in it Basically it scours in kind of big data sense every single publication on the planet and how are they talking about? the the pandemic and so just I've just been looking at trying to track these Week to week kind of changes and fluctuations and as you can see as the markets rallied The overall press obviously becomes a little bit more positive in that sense You know the as we said the S&P The best three-day rally since April of 1933. We had the Dow put in the best rally Since the similar sort of timeframe on when was it mid-week? So but what's happened here? We've had a little bit of an upturn now and actually if you look at it on a daily change We're up about 3% and I think if I was to back test this I'd probably say it's pretty similar going into a weekend Typically it tends to make people a little bit nervous particularly in the financial market sense But also if you think about it people are not working from home. It's the weekend the feeling is I want to get out there I want to you know comes the risks if you like of It's kind of congregation of people and things like that It probably accelerates if anything and so I'd say that does have an interesting read across then for financial markets Because if I start looking then at the general theme of things at the moment, I can't help but feel a little bit bearish I'm afraid in terms of how today might play out Because we've had such a phenomenal ride so far to the upside and I was looking at a couple of different things here This is looking on a daily on the S&P 500 Couple of couple just technical signals perhaps to be aware of One of these was yesterday we broke through 25 52 and as you can see here Previously that was quite an interesting area going back to the earlier part. You remember that sell-off that we had When the Fed obviously we were Rallying super aggressive at the end of 2017 after Trump delivered the corporation tax cut that started to have fears then of you know Trump flation Fed rate multiple rate hikes and then the markets sold off And then remember that 200 DMA was working really nice through that period of 2017 well really 16 17 18 But we've come back up then coming to where we are at the moment and the 50 DMA is about to cross to 200 So commonly known then is the death cross so the opposite of the golden of what we saw on this occasion If you look at the last time the death cross happened We had that I don't know if you remember if you can cast your mind back We had that kind of triple triple top and it was kind of a descending trend line here In that summer period, so let me just make this chart a little bit bigger so you can see everything I'm talking about so it was it was here as an observation and As soon as then on the third rejection the the 50 DMA crossed to 200 We then had this really big move to the downside which was then that low We saw going into it's a boxing day of 2018 before that phenomenal rally on the bounce back Well, yeah now we've we've managed to get back above there And you can see the markets found a little bit of a footing here on the dailies so far on the intraday Which was back to around those 18 lows, but upside equally and so far you got the fib 382 Which is from that, you know huge sell-off that we've had from the all-time high printed if you can believe it Literally about a month and a week ago. So five weeks ago when we're trading up around close to 3400 down to the low Of where we have been printing and so the fib a little bit of resistance here to be aware of the market I think we'll be looking at that because it's such a higher time frame everyone will be aware of it as well. So Yeah, the here then How we finish today is going to be quite key where we are I think if we can get back below this level perhaps we start to trade a little heavy again I think generally people tend to get a little bit apprehensive in these current conditions Because the coronavirus numbers are only going to get worse over the weekend and just given that in combination with how quickly We've run up in markets does make me feel a little bit as I said on the nervous side But let's see let's see how it plays out on the calendar. What have we got a few different things in the morning? Particularly quiet. It's not a great deal Going on until we get into the US session. Remember The UK clocks do change this weekend So we'll be back to the normal time if you're in the UK US data at 1 30 rather than 12 30 in the normal five hours London, New York So you got the PC personal income spending coming out this afternoon 12 30 you've got the final Michigan numbers Coming out this afternoon and then the Baker Hughes rate count as well for any of those interested You've got a couple of sovereign updates Fitch on the UK Moody's on Sweden and Moody's on South Africa And then if you're trading a fixed income market Just a reminder if you've got some futures expirations in the March contracts as well coming out as well as in Some of the commodities in gold silver and copper March futures as well So let me just switch over my my screen. Sorry, this is a calendar for today. I was just looking at but yeah Nothing really too much to excite I'd say on the calendar. So I think it's going to be quite a key technical day I think it's going to be quite sentiment driven and my overall as I've said and you probably have gathered is that you know markets It's unlikely. I think that they're going to just remain Continue positivity when we've outperformed so sharply. I mean these are quite unprecedented measures so far The Fed doing what it has done earlier in the week the balance sheet of the Fed now is above 5 trillion Which is quite phenomenal when you think about it gold Maybe susceptible bit a bit of a pullback particularly as well if you get some of the the booking of those Profits on the dollar shorts And that might then create a bit of a pullback in those major currency pairs where cable for one is completely outperformed As well when we're looking at that major pair And then the combination looking at those correlations between oil and equities. I think could be quite key to play that out Alright, that is it I'm going to leave you and wish you a pleasant weekend Stay safe, and I'll see you on Monday. Thanks very much guys