 Welcome to Tick Mill weekly market outlook for week commencing the 15th of June with me, Patrick Mullerley. The resurgence of COVID-19 cases offered a motive for some aggressive profit taking in equity markets after the extended rally from the March Lowers. If last week was about physical correction then maybe next week is going to be telling us more about how solid market appetite really is. I suspect that with headlines about second waves in the US, potentially easily in China, may cause an extension to this temporary upsets in risk sentiment. Risk assets may once again prove resilient though, still counting on the Federal Reserve's printing machine and taking heart from the restart of the global economy. Moreover, new COVID-19 waves will have an impact on markets only if there is a material indication that this implies fresh lockdown measures will follow. So there's a date next week and fundamental drivers, Fed Chair Powell makes his semi-annual testimony to Congress next week. Starting with the Senate on Tuesday, he's expected to reiterate comments made last week following the FMC meeting which left interest rates at the zero lower bound and maintained asset purchases on the QE at least at the current pace. Policymakers remain cautious about the economic outlook beyond the expected short-term rebound activity. He reiterated their readiness to add more stimulus should it be needed. Markets will be listening carefully to get more of a sense of what it would take for the policy to be loosened further and how seriously measures such as negative interest rates and yield curve control are actually being considered. There's significant slate of U.S. data releases as well including May figures for retail sales on Tuesday, industrial production also on Tuesday. Housing starts and permits on Wednesday and June surveys will also be released including the Empire Manufacturing on Monday, NAHB housing on Tuesday, Philly feds on Thursday, weekly jobs clearance also on Thursday likely to be closely watched. Overall, we can expect that the data is likely to show rebounds in May for sentiment to improve ultimately in June. From a technical perspective, Dollar Index tested down to our target at the 9615 and we have seen some profit taking coming in at the end of the week. But as this profit taking turns into a potential correction and it is ultimately capped by the 98-9850 area, I'm looking for a retest of last week's lows at the 95-60 on route to an ultimate retest of the year-to-date lows at 94-61. In the Eurozone, the main data release next week is going to be German June ZEW survey which is released on Tuesday. It's forecast to show a rise in current conditions to about minus 82 after dropping to minus 93.5 last month. Real focus though next week in the Eurozone is going to be on the EU summit on the recovery fund. We may yield some more encouraging headlines but will likely only be the first step in negotiations between those backing the original proposals by Merkel and Macron and those opposing the burden sharing agreement. While the meeting may help to reinforce the floor under the Euro, I doubt whether or not it's going to be sufficient at this stage to see a meaningful break of the 115. However, from a technical perspective, as the current pullback finds support at the 111.50 area, I've been looking to set long positions to target at least a retest of the year-to-date highs at that 115 area. However, I'd expect sufficient supply and profit taking on the first test and then maybe we see a deeper pullback or corrective phase to 110.50 where longs are likely to reload, refuel and then I think we can see a breach of the year-to-date highs targeting up towards 117 in 118 in extension. Now, in the UK, as the UK government formally confirmed, it won't seek an extension's transition period. The main focus next week is on a meeting between UK Prime Minister Johnson and EU Commission President Ursula von der Leyen, which has set to take place on Monday, given that the key points of contention remain. We don't really expect any meaningful progress to take place. The language may be non-negative, i.e. hints at intensifying talks, etc., but little real positive news is likely to come from this initial meeting. Even if a trade agreement is struck later this year, the change in the UK-EU trading relationships will be a negative for the UK economy next year. On the UK data front, the Bank of England meets on Thursday, and markets expect to expand its QE programme by about £150 billion. An extension of QE is expected by the markets and should therefore have probably limited impact on sterling. Still, the uncertainty about UK-EU trade deal should prevent markets from pricing out the possibility of negative rates in the UK. Technically, we look for the sterling to test this ascending trend line again back to 124, where if we see bids emerge and maybe some daily bullish reversal patterns, it could be setting long positions there, ultimately targeting a test of the descending trend line resistance and back to the yearly pivot to 128 to 129 area. The main focus in Japan next week is going to be the Bank of Japan meeting. It should once again really be an event in terms of material headlines and hardly a hindrance to the resilience that we've seen recently in the Japanese year. The Bank has notably run out of tools to support the economy after committing to unlimited bond purchases and already having negative rates in place. The ultra-dubbish stance is set to remain in place and the markets is pretty fully priced for that. On a technical perspective, look for corrective moves higher in the dolly yen early in the week to be capped at the 10850 area. If you see some bearish daily reversal patterns here, bearish positions should be rewarded. Ultimately, on a looking for a retest of the year to say it goes at 106, enroute the ultimate objective of the 10450 area. Only a move back through or a close back through 10850 would suggest a false break to the downside and set sites on the descending trend line resistance back up towards 110. The Australian Dollars Extraordinary Rally took a breather at the end of the week. A resumtion of such a run next week will not only depend on the performance of global equities and the news regarding second waves, but also on some key employment data in Australia. A Bloomberg survey suggests that consensus is centred around a 75,000 drop in employment in May after the extraordinary payrolls numbers in the US and Canada markets might be disappointed with a negative read. With a bar for positive surprises set quite high, the Aussie is still dealing with the sense that the recent rally is somewhat overdone and unresolved and pretty dangerous diplomatics back with China continues to creep on in the background. From a technical perspective, the Australian dollar has pulled back to test symmetry swing sport at the 68 handle. As this area holds, we can anticipate another run at the 70 level, but if we get sufficient supply here, I can see the case where a pullback to ultimately test support back to the 66 level before seeing a resumtion of the uptrend looking for an ultimate test of the 71 area. That concludes the weekly market outlook for week commencing 15 June.