 Hello and welcome to CMC Markets on Friday the 23rd of February and this quick look of the week beginning the 26th of February and it's been a little bit of a status quo for equity markets this week after the big rebound seen in the aftermath of those two big weekly declines that we saw at the beginning of February. I think the big question in the moment is where do we go from here because ultimately while US yields have gone a little bit higher the 10 year has been as high as 2.95% but in more interestingly is that we've actually come off quite considerably from the highs that we saw in the early part of the week and as a result equity markets have stabilized and appear to be holding below some key resistance levels on the daily chart in the aftermath of the rebound seen in the middle of the month. We can see it best illustrated here on the DAX still below the 50% retracement level of the overall down move from the January pinks to the February lows but what is interesting I think in this regard is despite the fact that we made record highs in January is the fact that we've actually looked on course to post a significantly negative closing month for February we still have a number of days to go so there's plenty of time for that particular scenario to not play out but ultimately the declines that we've seen have been much more prominent and prevalent in European markets than they have in US markets and I think the big question at the moment is where we go to next. Now the fact that we backed off to 3% for US yields has appeared to suggest that ultimately despite the fairly hawkish Fed minutes that we saw this week that expectations around what rates might do this year are still very much tiered towards 2 to 3 rate rises so far this year as opposed to the expectation of 4 because I think if there was an expectation of 4 rate rises we would see a much more concerted push towards that 3% level or maybe the trade is becoming a little bit crowded in terms of the 3% trade and maybe we are going to see a little bit of a pullback from highs we saw earlier this week we're certainly seeing that played out in bond markets at the moment and that's been reflected in the rebound in US markets that we have seen in the latter part of this particular week this this is the weekly chart that we're looking at now for US markets we can see we had a very strong week in the third week of February we've got a little bit of still a little bit of negative still a little bit of negativity for this week but what we haven't done is we haven't pushed below beyond rather that 2745 area on the S&P and I think that particular level is going to be particularly important in the overall scheme of things as we move into March next week we look at the monthly chart we can see that despite the losses that we've seen in February we still remain very much off the lows of the month and we have also seen a nice little rebound in the US dollar index from the levels that we saw at the end of last week but we're still within that trading range that we were talking about this time last week we did make a marginal you low on the dollar index if we look at it on a year-to-date basis this is potentially a bullish reversal but ultimately I'm not going to get overly overly bullish on the US dollar until such times as we've taken out this series of peaks through here now we can we can draw that on on this particular chart here by a horizontal line all the way through that level there it's around about 91 give or take give or take the odd people to but could be could be the makings of a potential double bottom on the dollar index but we won't know that until such times as we're able to take out that 91 level now that's also throws open an interesting development you're a dollar you're a dollar finding a little bit of a top around about 125 here we can see that on this daily chart here key day reversal there finding a decent area of support around about 122 and below that 121 60 so again a potential potential for a little bit of a a top-building formation at the moment but until such times we break out of this range that we're in the likelihood is it's probably going to be a continuation of sideways consolidation that we've been in over the course of the past few days so what are we looking at for the week ahead well again yeah it's going to be inflation represses that I'm going to be paying particular attention to so it's the latest flash CPI from European Union this week we saw January prices confirmed at 1.3% on the headline and 1% on the core but we've also got core PCE from the US now that's currently trending at around about 1.5% this time last year is 1.8 so there is still no evidence at the moment that we're seeing a pick up in inflation repressions despite the optimism from the Fed minutes that we saw earlier this week so it's very much a it's very much an inflation of inflation perception for this week's data but we've also got a whole host of February PMI data coming out from France Italy Spain and Germany and we did see a little bit of softening of those numbers in the preliminary numbers that we saw in the early part of this week so looking ahead to next week expecting to see that slight softening confirmed we've also got Chinese PMI's for manufacturing and services and they're expected to hold up fairly well but there is a word of warning with respect to these Chinese numbers they are likely to be affected by Chinese New Year celebrations so you could get a significant negative skew on these numbers don't read too much into them because of the fact that half of China is probably closed the Chinese New Year at the back end of February so but those are the key economic numbers that I'm keeping a particular eye out for in the coming week as well as the upcoming Italian election on March the 4th key numbers on the company front to keep an eye out for are capital groups four year 17 results after their profit warning at the end of January hopefully there's not going to be any new nasties coming out of that and the latest four year results from standard Chartered Bank otherwise that's it for this week thanks very much for listening it's Michael Houston talking to you from CMC Marcus