 Right, good afternoon ladies and gentlemen. Welcome to this month's Non-Farm Payrolls webinar on Friday the 4th of April from CMC Markets. My name's Michael Cusen and I'll be taking you through some of the key levels that are on the charts that I'm actually looking at today in the wake of this Non-Farm Payrolls webinar. First and foremost I have to take you through risk warning. That's some required practice. Once I've got that out the way then we can crack on and have a look at the charts. Now it's obviously been an awful lot of speculation really I think about the outlook for the US economy over the past three to four months. The US Federal Reserve at its last FOMC meeting dropped its guidance threshold for the unemployment rate which was 6.5%. The consensus today as you can see on the screen is for a drop in the unemployment rate from 6.7% to 6.6% and increase in Non-Farm Payrolls from 175 to 200. Let's drill down into the detail for that because this is something that I do a fair bit with respect to the spreadsheets. I look at an Excel chart of the various Non-Farm Payroll numbers and the three month average which actually is quite important. Now you may recall in October we had the debt ceiling there barcal and since then we've seen the US economy start to slow down. Now an awful lot of commentators have put that solely down to the very unseasonably cold weather that we've seen over the past three months. There's certainly an argument for that. Certainly the December number of 84,000, the January number of 129,000 has brought the three month average for Non-Farm Payrolls down quite considerably particularly when you look at this three months here from 164 to 237 to 274 then we saw a significant drop off in December 284,000. Obviously that was a bit of a disappointment since then we've had a bit of a trough in payrolls data. This week's ADP number wasn't particularly enlightening in the context of this week's Non-Farm Payrolls number but I think one of the things that has been notable this week is the expectations for Non-Farm Payrolls and the monthly number have actually gone up quite considerably. Now the expectation here is in the March number is for around about 200,000. If we look at the same period last year we saw 141 and 280 and 197 so we can see straight away on a three month average we're quite significantly below that but obviously last winter in the US not the one just gone and the one that they're currently experiencing was significantly milder but I think there's also an underlying weakness in the US economy as shown by the retail sales numbers and that's that's borne out by this particular spreadsheet. Here we can see the retail sales numbers since October November it's been on a downward path yeah we have seen a bit of a tick up in February. Consumer confidence has been rising all of that time since the trough in November last year but if you notice that while consumer confidence was rising retail sales were falling so you know there is a significantly mixed picture I think for the US economy at the moment and certainly this week's trade numbers which blew out to a $42 billion trade deficit for the month of February do seem to suggest that Q1 is likely to come in near a 1% growth than 2% growth you know and I think that's particularly important when you look at it in the context of the overall state of the US economy. I think at some point we will get a pick up in US jobs and numbers I just think that maybe March is too soon because when you actually look at the weather in March okay they haven't had any snowstorms but average temperatures in March even I've still been very very low and the lowest they've been I think for the last 10 or 15 years so I think expectations of a rise of 275,000 which are being touted in some areas from Deutsche Bank for example and also Society General I think maybe maybe slightly optimistic I'm certainly not expecting a number anywhere near that high I'm expecting a number in the region of around about 189,190,000 having said that I got last month's wrong and the month before that but say la vie. Unemployment rate is likely to decline but again I think that's really dependent on the US participation rate and the US participation rate is just off a 35 year low it's currently coming in around about 63% off 35 below of 62.8 so again need to keep an eye on the US participation rate because I think if that starts to tick up at the same time as the unemployment rate starts to edge down I think that's generally going to be positive for US jobs growth going forward so what I'm going to look at for the moment is the dolly end because I think the dolly end for the past two months has really given a good indication as to why the markets are positioning with respect to the payroll's number so the consensus is 200 I think if the market thinks we're going to get a good number we could well see dolly end start to push higher certainly the past two or three payroll's numbers just before the numbers come out dolly end is shot up only to come back down again on the back of a disappointing number so I think I think what we've got to do is look at this in the context of what markets are expecting markets are expecting a number in excess of around 215 or 220 judging by some of the moves that we've seen so far this week so I think and even if we come in come in on consensus we could actually see an initial sell-off in the dollar so let's let's start with some of the charts that I'm looking at and I'm going to start with a very dollar centric theme here I'm going to start with dollar Canada and I'm going to tip my hat to my colleague Rick Spooner in Australia for this one because this is a really nice chart on the dollar Canada it's an hourly chart we can see it here and there's quite a nice little triangular formation building up here and I think you know if we get a move either side or breakout of this particular triangle we could see a strong move higher or lower so I'll certainly be keeping an eye on this chart in the wake of the payroll's number and we've also got to remember that it's also Canada payroll's day-to-day as well so I think in that context it could actually be significantly important given the fact that it's not only US payroll's day it's Canada payroll's day so it's certainly worth keeping an eye on dollar Canada on the hourly chart because it's because I think there's a potential for a very strong move one way or the other and that's I think that's important when it comes to triangles you trade the breakout of the triangle trading the direction of the breakout and it should give you the move and if you look at the apex of this particular triangle we can see that from here starts at $110.90 comes down to around about so we should get around about 100 basis 100 point move higher or lower on the breakout of this particular triangle let's also look at the dollar index because I think the dollar index can give us some fairly good indication it's the overall longer term trend of the US dollar so I'm going to pull my Bloomberg onto the screen here and have a look at the dollar index because I think that's actually quite important over the past couple of couple of weeks we've seen the dollar start to rebound somewhat and two weeks ago we saw what I would designate a bullish engulfing week which does seem to suggest that maybe the dollar has got room to push higher towards the highs of this year around about 81 and a half now what does that mean for Euro dollar well given what Mr Draghi has said this week and Mr Draghi is definitely hoping for some very good US economic data because it gets him out of a very large hole of his own making the last thing that the European Central Bank wants is a high euro unfortunately they lack the tools at the moment too much about it so I certainly think after Janet Yellen's comments earlier this week I think she will have been crossed off Mario Draghi's Christmas card list after talking the dollar back down but certainly given the performance of the dollar index that was very much a temporary factor in the case of the euro dollar why is the dollar index important it's important in the context of the euro dollar because dollar index 57 percent of it is euro so we can see that here and we can see that we're approaching a very key level on euro dollar on the downside we've got trendline support coming in from the july lows last year and we can see that was also the 100 day moving average so we've got a double support coming in on the euro dollar around about 13670 13680 so any dollar strength against the euro is likely to find some support around about the 100 day moving average and the trendline support from the lows last year in july at 12780 so keep an eye on that line that's that's going to be significantly important in the event of a good non-farm payrolls number also let's also look at dollar swiss because i think that gives us an also a nice little indication here and we're pushing against the highs that we saw from february the end of february around about 8930 8940 so once again a strong payrolls number should see this resistance level taken out but we're pushing against it and at the moment what we really need to see is just to close above it but also look at the slow stochastic here we're looking very over ball doesn't mean we can't go higher we can certainly get a push higher towards the 90 level but again once again we're approaching some key resistance levels on the u.s. dollar now let's look at our old friend dolly n because dolly n again we are just above 104 but again really the 105 50 level that's really the key level for me on dolly n and the one thing that bothers me about this again is the fact that we've got what i would call a little bit of a bearish candle here on the dolly n on the daily charts having said that it's not really conclusive it's very very difficult to sort of ascertain whether or not this is just a little bit of a pause before we move back towards the 105 level so let's try and see if we can get any clues with respect to the us bond markets because certainly think the us bond markets can give clues to the overall direction of us yields and there is a strong correlation between us bond prices us bond yields and dolly n when us bond yields edge higher dolly n tends to follow them so there is an inverse correlation lower bond prices higher dolly n we're on trend line support for bond prices from the lows that we saw in september last year so once again we're on a very key us dollar support level in terms of us bond prices and a resistance level when it comes to yields and we can see that it's born out on my bloomberg chart here if i just pull it across for you so that you can see it i'll just do that now one second give me a moment pull it across and we can see that here candle chart this level here is around about 282 2.82 key resistance level it's the highs in march at the moment we're struggling to push through it so what we want to see is really for dolly n to go up we need to see higher bond price higher bond yields lower bond prices also keep an eye on gold in the wake of this number because i think gold will be very important as well gold is on has been has been on a key support level for quite some time and we can see that from this particular daily chart here as well as the oscillator that's potentially quite a bullish reversal on the dailies it is now starting to push higher let's look at a slightly shorter term chart on that and again gold is starting to ratchet higher ahead of these payrolls numbers but again i wouldn't read too much into that because markets tend to front run a lot of these numbers beforehand so again keep an eye on 1280 $1280 an ounce on gold we're starting to get a push higher in anticipation of that what i want to see for the gold prices for us to move back above the 200 day moving average that's really the key there we can see that on previous days over the past couple of days 200 day moving average has acted as resistance and we can see that on this chart here around about 1298 1299 and on that day there 20 28th of march and on monday so we're pushing against the highs for this week on the gold price so keep an eye on that if we push back above 1300 i would anticipate a few stops getting cleared out through there keeping an eye on dolly n dolly n just a quick reminder that from the last two payrolls numbers that we've seen we've seen dollar dolly n ramp higher and the markets generally tend to have generally tended to get that wrong i think they tend to i think there's a little bit of a reluctance on the part of the markets to try it third or fourth time in a row here so we're starting to get a little bit twitchy ahead of the payrolls numbers as i said when i started the payrolls numbers are probably lost an awful lot of their importance but i certainly think in the context of um this payrolls number we'll still get a reaction the key question is will we get a reaction higher also there's something before i do do this quickly show you the s&p chart that i've got here look at this potential triangle breakout on the s&p are we going to go through 1900 and push on to 1930 really needed i think what we really need to see is a fairly positive payrolls number but that will that really remains to be seen again front running the number dolly n is starting to push higher or to surprise it's all so predictable just before the payrolls numbers 24 seconds to go and we are getting a ramp higher in dolly n so as i said previously quick summary 2225 could be perceived as a good number i think if we come in on expectations we could actually see a bit of a sell-off so let's see what's going to happen i'll be quiet now and wait for the numbers to come out here we go 192 and 6.7 percent so and revision upwards of 197 and again it's a little bit of a disappointment what a surprise buying it into the payrolls and down we go on the back of it so again it's a disappointment i was expecting 189 we came in at 192 so pretty much as expected do it your bank and sock jane get it wrong again and again i think it's really i think it was very very premature to really think about a sharp jump in the payrolls number given the fact that you know the average temperature in the us was and has been at record lows for the well not record lows but the lowest levels has been for 10 years and we're really seeing that with really seeing that being borne out in this in the in the price action that we've got here so not really had any effect whatsoever on the s&p we're still pushing higher so once again it's a negative dollar reaction which means that the push higher in the gold price was a little bit a little bit of a head of a head of expectations but the revision higher in February is positive but the fact that we've come in at 192 which is probably not that much different to expectations means that the three month average still remains at a fairly fairly low level and as such people are now going to start looking towards the numbers in April for evidence of the pickup so we've got 192 here we've got 197 here it brings a three month average up ever so slightly after that significant drop off that we saw in December certainly now that those numbers have dropped out of the equation it's certainly an awful lot more healthy and overall apart from the 84 number it's probably not that bad let's have a quick look at dollar canada on the back of on the back of that chart that I showed you earlier but it certainly does look like we're going to see 1900 on the s&p today you know it's the good news is bad news bad news is good news is the usual story the upward revision was obviously very positive but it's not really I think it's really taken some of this sting out of I think it's taken some of the sting out of the overall move and we can see straight away look at that nice breakout so again sharp move lower should see a move down to around about 109 109 30 109 on the back of that that that payrolls report there so that would have been a nice move if you've been able to take advantage of it so u.s. unemployment rate and ticks up to six basically stays the same 6.7 unchanged pretty neutral really payrolls report despite the fact that we saw a fairly positive services ism employment bounce back in March which just goes to show just because one number tells you that you're going to get or gives you an indication that you're going to get a good u.s. employment report doesn't necessarily mean that you will do let's look at euro dollar and again we can see straight away it's been not significantly good enough to give us a significant rebound sell-off in euro dollar so again the very key support level around about 136 70 136 80 while I'm here is there anything in particular that any of you guys ladies and gentlemen want me to have a look at and basically give an opinion on that I haven't already covered because it's not just about me talking to you guys it's also you guys feeding back to me so is there any particular market that you want me to basically cast my eye over give you an opinion on do some analysis on please feel free to send me a message on the chat it's fairly easy to do just just just send me a quick message and I will give you my my tuppence worth on it while while I'm while I'm waiting for that we'll also look at Australian dollar because next week is could be a fairly important week for the Australian dollar we've broken higher on the top side we're finding resistance at 93 general consensus has been on the Aussie that we're going to we're going to probably drift back lower but certainly on the basis of these technical charts that doesn't seem to be the case I'm certainly not convinced that we can ratchet lower from here because we we've broken a number of key levels on the top side which would seem to suggest that maybe we could actually have potential to go higher all right I've just been asked about the US 13 I'll I'll have a look at that just after I finish this more than happy to do that is this here guys an upside down head and shoulders we've got the left shoulder here we've got the head here we've got the right shoulder here if that is the case then if we measure this move here and project it higher it brings us back to around about 95 or even 96 cents the only way that I would reverse my potential move or my potential opinion for a move in the Australian dollar higher is if we drop back below this neckline here and the 200 day moving average so at the moment the Aussie is broken higher we've had a number of commentators talk about it going back down again and coming back down to this trend line given the fact that if you acknowledge that this is an inverse head and shoulders and we do this then there is certainly potential for us to ratchet back to these sorts of levels here 95 95 80 or even 96 so I think that's really the key level on the downside on the Aussie keep an eye on around about 91 80 91 50 we drop below that then we we could potentially come back all the way all the way back lower but certainly if this is a upside down head and shoulders which it certainly looks like from my perspective and I certainly think we could well get a short squeeze in the Australian dollar and it's certainly worth keeping an eye on in the short to medium term okay so let's look at the US 30 we've made new new all-time highs we are very oversold on the daily slow stochastic but certainly looking at the momentum trade here the momentum trade still appears to be fairly positive I think the key level on the downside for me on the US 30 is around about 16 and a half thousand certainly if you equate that with the S&P as well the fact that the S&P has broken out on the top side then you really got to think that there's potential for maybe more gains here on the US 30 certainly on the daily chart let's look at the four hour chart see if we can drill down into that even further and we can see that certainly on this four hour chart we remain in a very very strong uptrend and therefore any dips are likely to find a fair degree of support around about 16,350 16,400 certainly on the basis of this line certainly the momentum does appear fairly positive you've also got to take into account the fact that the S&P on the chart that I just showed you a few minutes ago does appear to have broken out to the top side on the daily chart and that does seem to suggest to me irrespective of what you think of the data for the market wants to take this higher so any dips on the S&P are likely to find a fair degree of support around about the base of this line here which is around about 18,80 certainly a test of 1900 appears to be on the cards if we measure this triangle higher here and project it from the breakout point which is which is essentially what we're talking about then you're looking really at 1920 or 1930 over the course of the next few trading sessions the only the only caveat to that will be is if we drop back within this triangular consolidation then we're probably going to come back all the way back to this lower line here and as such this would then be a false breakout so it's certainly something to bear in mind in the short to medium term okay so NASDAQ US NASDAQ yep I'll look at that for you let's look at the US NASDAQ 100 looking at the slave chart on that here we go that looks to be as if it's starting to build up some form of topping pattern but again the neck line remains somewhere away that's the weekly chart let's just drill down into that we can see that there um let's look at the trend line from the highs that we've seen in March I suppose this feeds into the narrative as to whether or not we're seeing a bit of a tech bubble or a bit of a tech unwind let's look at the moving average let's look at the um technicals so looking at these studies looking at my favorite slow stochastic so what I use as a general rule again that's that's actually looking that's looking as if we could well be it's buying on I think it's buying on the dips at the moment we've certainly got resistance coming in around about um 3700 or just above that we're in a little bit of no man's land at the moment let's drill down even further into the four hours see if we can get any clues from that a couple of peaks around about 3670 3680 as designated by this chart here so we can drill down into that there we go let's let's drill down that all the way across that's interesting so 3675 3780 looks a little bit toppy having said that bit of an uptrend from the 24th the week of the 24th of March coming in there a bit of a convergence coming in there so I would suggest that if we break higher we're going to run into this line here if we break down then we're certainly going to come in a little bit lower towards these lows here hopefully that helps just done that just done the Dow Jones um do you want me to do it again quick question it's the us 30 the Dow Jones would you like me to do that again sir or um did you did you get okay more than happy to do the Dow Jones again that's the us 30 so we talked about that a little bit earlier there's the analysis on the four hour chart um support around about 16500 we can move that line down here in these series of lows here it is looking a little bit oversold in the short to medium term I think if the S&P is unable to get through 1900 today and I think that is likely given the fact that we're coming into the weekend we could see the Dow Jones start to drift back down after it may be a late squeeze in London we may see a ramp into the London close so we'll try and test the highs but I think overall I would expect to see the market start to drift a little bit lower just because of caution heading into the weekend certainly I think there is an expectation I think there is always a nervousness given what's going on in the Ukraine and certainly there has been some chatter about um US intelligence saying that they are concerned about a Russian build up so I would be very reluctant to go into the weekend overly long of um long equity markets simply because I think the risks certainly don't the rewards don't outweigh the risks okay guys anything else that I haven't covered as yet one thing I think is quite interesting is Brent crude it's on a very very key support level in the long term and we can see that from the weekly chart here so certainly keep an eye on a weekly close 200 week moving average but also this trend line support from the lows in 2009 we ride on it so keep an eye on Brent because I certainly think that could actually give some indication as to what markets think about um certainly growth growth projections going forward as well as copper next week we've got some important Chinese data best performing sectors a day on the FTSE 100 has been basic resources on the back of that Chinese stimulus that was announced earlier this week key question for me is to whether or not Chinese inflation or deflation whichever way you want to call it Chinese inflation continues to fall and as to whether or not the Chinese trade balance next week either improves or actually gets worse so keeping on the Chinese data next week we've also got Bank of England day Bank of England meeting next week not expecting too much from from that overall otherwise I'm going to sign off this week one thing I would say we have got a couple of events coming up in April there is a forex seminar here at CMC markets which is on the 16th of April you can sign up for that on our website I'll be hosting it basically looking at looking at some of the key the key indicators that I look at when I'm trying to predict where the markets are going to go certainly in the context of currencies and there's also a London trader network on the 23rd of April which is again in the evening so feel free feel free to sign up for that more than happy to host you here at CMC markets one more question what do you think I think yeah good question that I've been asked basically what I think the Dow will do when US markets officially open I think what I think we may see a bit of a downward I think we may see a bit of a downward push initially on the US market or leading into the US open but I certainly think the market will want to try and test that 1900 level at some point during the trading day but as I think is as we head into the open I think the market the US traders will push the market lower initially before taking it higher hope that helps all right ladies and gentlemen well that's it again for this week's non-farm this week's this month's non-farm payrolls webinar I'll be posting it on YouTube so if there's any bits that you wanted to listen over again it will be going on YouTube over the weekend you can have a listen to it playback any bits that you might have missed otherwise I'd like to thank you for your company this month and I'll speak to you all again in a month's time if not if you can't wait that long I do a weekly webinar or me and my colleague Jasper do a weekly webinar on a Monday at 12.15 every Monday thanks very much thanks guys