 Hello and welcome to the Monday market update with me David Madden. Today's date is Monday the 28th January 2019 and the time's just gone 1135 GMT. It's been a fairly quiet start to the European session this week equity markets in Europe are broadly speaking a little lower There's still uncertainty about the US-China trade relationship and the two sides are due to meet later on this week but The recent company referred from various Europe's US policy makers and trade representatives suggest that they go up to the two sides remains fairly wide But what's interesting is even though we've we've we've seen largely speaking Slightly negative news in relation to US-China trade relations equity markets over the last number of weeks I've still managed to kind of push higher So when we have had negative news the markets gone down a small bit, but not really a whole lot So it's almost like traders are kind of waiting for Positive news to be announced in relation to US-China trade talk before we can then actually move to the upside because We had a fairly sizable sell-off in November and December a global equity markets We've seen a bounce back since very from late from late December We're now in late January So broadly speaking equity markets around the world I've had a fairly decent bounce back in the last four weeks and they will when we have had Setbacks between Washington DC or Beijing in relation to trade The equity markets have really haven't gone down a whole lot So there isn't much buying sentiment out there, but the same time there is a lot of really negative sentiment out there at At the same time Keep in mind with a fairly dovish update from Mario Draghi of the European Central Bank at the back end of last week They've made it very clear that they're willing to support the eurozone economy in turn and willing to adjust The policy monetary policy if they if they feel the need to so that was an indication that yes We know things are great in the eurozone in terms of economic indicators But we wouldn't do something about it should we see the need to do so and that's all to give again of it Assistance to eurozone equity markets in the last few sessions Today in terms of macro news is the kind of US-China situation is the is the kind of front and center We've had a few corporate stories over the weekend. There's a report that a cattle and Brought dispensers are in talks in relation to having a tie up between the two M&S at the retailer They have a fairly limited Reach in terms of delivery service. It's very in terms. It's very selective Whereas there's there's a report which is not a sign of confirmed But there's report on the less that the two sides are in talks in relation to striking a deal I can't of course have been the kind of online delivery service and the past year or a couple of years I can't have been going around the world striking new partnerships Which you know companies in the UK mainland Europe and also North America so that there's talk that we could have a Deal between them and M&S speaking of the British supermarket sector test goal We're also in the news over the weekend. There's there's a report going around About potential for up to 15,000 job losses The supermarket sector in the UK as a whole has been under a fairly big change In recent years the rise of little an alley the German deep Discounters and also the rise of online shopping has made some retailers Maybe you could have moving to distribution or merger of other companies or look look at very different other avenues of actually making money Or in some cases spend more money online and less money on the high street I'll take a look now and some of the major major markets starting off the FTSE 100 So the FTSE 100 remains in the downward trend that's been in play now for a number of months We can see here the middle of the month the FTSE 100 got up to the kind of 7000 mark But it's been drifting lower since again We can notice here how the low of today's session is managed to drop below the low of Thursday last week So we are heading lower There's been a change from positive momentum to negative momentum on the MacD indicator on the MacD histogram So the market's moving lower. We're seeing an increase in bearish in negative momentum So the bearish more control so we could look at pressing on lower from here And if you do look to push further further south from here We could be looking at any back down towards this area here In around a six thousand six hundred and seventy five and a move below that could bring us back down towards six thousand seven hundred And a move below that could take us back down towards the December low Six thousand five hundred and thirty six and he moves to the upside are like like to run run into resistance Seven thousand it speaks like a logical number. We can see in a few occasions recently the market failed to get above So a break above seven thousand What would bring us back to level is not seen since late November and I could point to it to further gains from there Taking a look on the on the DAX the German market So the DAX has had a fairly decent bounce back since late December. So Take a look at the move higher here in late December has been pushing higher Only on Friday. We saw it back levels not seen since early early Early December so the markets are markets clearly be pushing to the upside positive momentum is not fairly strong So in the near term, we could see further further movement to the upside on the DAX And if you do look to press on higher from here, we could be looking at it up towards the kind of eleven thousand six hundred region or if you draw a trend line between the highs of Of June July and also September granted It doesn't go that there's been some occasions where the market has gone ever so slightly above the trend line But this this trend line here indicates the markets being clearly be pushing lower for many months We are rebalancing but this old trend line with this old trend line resistance may come back into play So if you look to push on higher from here, we could look at heading up towards in a five thousand Sorry eleven thousand five hundred and twenty region or maybe up to eleven thousand six hundred somewhere in around that Bearing in mind the wider wire trend is not very much of the downside So it might be the case that we could run it run into resistance at this trend line before potentially turning over again But in the near term, we could push on higher here potentially another two or three other points from here If the market does manage to turn over on itself yet again keep on out for eleven thousand That's big psychological number and are recently acted as a support only last week And also coincides with the fifth of the moving average and if that metric and a few occasions from last summer did manage to access Resistance so it may act as numerous new support and the below a move below 11,000 could signal that the continuation of the What of the wider downward trend is back in play? I'll take a look now at the US markets starting off with the S&P 500 Similar situation in the US we've opened up the price action of US markets with that of the European markets So on the daily chart starting off if you draw a trend line between the lows of February 2016 and the lows of November 2016 We get this trend line along here We can see in a few occasions Back in October and also in November and a few occasions in December the trend line was well-respected But in mid-December there's a decisive break south of the trend line And as you see here in late November the market then managed to have a sizable bounce back But what do you know? We've pushed higher We've been pushing higher for about a month now on the S&P 500 But we can't see to get back up above that previous trend line So what was acting as trying support back in October and November is not looking at acting and looking as if it's acting Resistance so while we remain south of this trend line the wider The more recent negative trend is like it's more likely to remain and play But if you do actually manage to trade up hold above get above this trend line and close above it and press out higher from there They could be it could be act as support once again So you keep coming off of this region here and we're very close to it The trend line of distance comes into play in around this level. Maybe 2660 2670 this area here is where the The trend line resistance comes into play the high from last week was 77 Our the high from the middle of the month was 2677 So we really need to kind of probably take out 2680 and then hold above it And before we come more confident that the the bounce back is continuing and the market is looking to retest Muddy mom highs if you do manage to move a move beyond that We could be looking at targeting this red line here the turn of the two or two moving average at 2742 and a movie on that might bring in 2800 to play If the market fails to move above the trend line We could try line resistance We could look at a back down towards this blue line here fit today moving average which comes to play 2680 and I move below that could take us back down towards this region here in around the 2532 and then if you go below 2500 that could be a sign that we're looking to turn over ourselves yet again and Looking at the wider downward trend coming back into play I'll take a look now at the Dow Jones and it's a similar ish situation Now if you draw a trend line between the lows of February 2018 And then it loads our runs through the lows of April and also true may we get this trend line here No, I'll have we can see there's a few occasions with the market trading below the trend line By and large it acted as support in both October and November last year But then of course market in about early to mid December at a fairly very sizable sell-off like in the S&P 500 Well At a major sell-off but then since late December at market has been pushing higher and once again We see a similar situation where the market is bounce back But yet it can't seem to actually trade above and hold above that trend line So the old trend line support is not acting as trend line of resistance And it's a similar situation if we fail to get above this trend line We could be looking at turning over ourselves again and head back down towards the 24,000 mark or 23,663 in around here or perhaps even heading back down towards 23,000 but if you managed to actually trade above it and hold above it and looked at a press on higher We could be looking at retest in the 26,000 area So we're pretty much at a fairly crucial area for what the S&P 500 and also the Dow Jones Now Dow theory tells us that the averages must confirm each other So as you can see here about the Dow and the S&P are just below their respective trend line of resistance If both markets fail to reclaim the trend line resistance and hold below the trend line resistance It makes it more likely that both markets will continue to press lower if both markets regain Move above the trend line resistance and push on higher It makes it more likely that both markets will continue to push on from the late December recovery So even if you're just say trading one of those two markets be the Dow or the S&P It's good to keep an eye on what the other one is doing for kind of confirmation of the of the move that you believe that it's in Take a look now at the old side the gold market So gold has managed to print as of as of today about to print a level not seen since June last years mid June last Years we are talking seven month highs The gold market as I began its bounce back in a minute mid Mid-August but really since about mid-November if the market's been in a fairly solid upper trend and my series of higher highs and higher lows Recently it couldn't get above the thirteen hundred mark and I was just about printed above it for pretty much on 1300 or 13 to one at the moment So the market is in very much an upward trend fast over of months if you can press on higher from here We could be looking at targeting 1326 and then I don't think I'll be on that You could be looking at targeting 1335 if the market does manage to drift a bit lower and pull back a bit Support might commit to play in around the in around the the 1290 region or definitely keep an eye on for this area here in around 1276 it act in the kind of 1276 1277 region in around here And recent weeks did act as 30 days in support. So keep an eye on for that But if you do have a break below 1277 we could be looking any back down towards 1265, but it's been in a fairly obvious upward trend now for a couple of months And if you look it back from August, it's been seven months that has been bouncing back I'll take a look now what's going on the oil market. I think I got brain crude So obviously the market kind of like global equities has been has been bouncing back since late December But we can see here that In the recent second in the last week or so to move to the upside of the kind of bounce back is kind of running on steam a bit we're largely moving inside with so The bounce back is still in place So we're well off the lows of December, but notice how the market is really kind of making much more ground It's only kind of rain. It's only kind of hanging a certain rain So if the market is to continue the bounce back We need to be taking up this area here at 63 spot 35 And if you go beyond that we need to take a look at heading towards the mid November high of 68 spot 36 and then we'll be on that might bring the $70 a barrel into play If the market does manage to get a drop back below the 50 day moving average here Which comes to the play at 59 spot 27 We couldn't be looking at any back down towards this region here in 57 spot 50 and the move below that could take us back down towards 55 I'll take a look now at WTI It's a fairly similar situation or by the markets had a decent bounce back since since late December But it's the bounce back is looking as if it's running out a bit of steam So this is the move higher here from that December 26th The markets been pushing higher a decent bounce back But notice how the highs here in January really failed to take out the highs in November Which comes to play at 54 spot 14 and we've just been training in a fairly tight range recently So if the market does manage to kind of run out of steam and I can't take up the November highs We could be looking at a back down towards the $50 a barrel mark and then a move below that They take us back down towards the 47 region And if you go below 47 bucks, we could be looking at retesting the December lows If you can manage to press above 54 spot 14 Keep an eye forward this area here I'm going to get a big November highs in our in around the 58 spot 10 region And then a move beyond that might bring the psychology important 60 bucks a barrel into play Take a look now at the euro versus the US dollar So we saw a lot of volatility on the currency pair last week to be honest in recent in the last Couple of months broadly speaking euro dollar has been going to pushing to the upside There's been obviously it obviously in early January hit a level that's seen since October But then again with the ECB update last week the market did not to be lower again Broadly speaking we can see a few higher highs and higher lows along here So broadly speaking it has been pushing higher and essentially while we remain off the Look at the recent lows of it in around the kind of 113 region We look at we could look at a heading back up towards the 115 115 10 area or the recent high at 115 70 and then if you go beyond that you can be looking heading up towards 116 If you take up the recent lows and have a decent break below 113 You could be looking any back down towards the November lows of once by 1216 I take a look now. It's going to the pound versus the US dollar Once again, Brexit is going to be in play this week. I'll be talking about that When I look at the week ahead in a second, so from basically early early to mid-December onwards with exception of the the night of the kind of The flash crash on the currency markets in early January the market is moving up in a fairly steady upward trend There's optimism a Theresa May's plan B deal is going to is going to Is going to it's going to get passed even though Brussels don't seem to be to in favor of it Which is which is a very important factor and by the time being the pound is in a fairly decent upward trend versus the versus the US dollar if you can hold above This red line here the dirty moving average which comes to the plate just north of the kind of one pound 30 mark We could look at pressing on higher and targeting Well, well essentially level level's not since the summertime in around the 133 so one spot 33 60 region if you click the press on higher from here If you have a size of a break below the 130 mark, we could be looking at a back down towards the one one spot 28 15 area in around here, but I expect volatility is going to be fairly high given a Theresa May Theresa May's Brexit plan B. He's to be to be debated on and voted on this week I'll take a look now at the the week ahead article The weekend article can be found on our platform on a website rather if you go to see some markets calm Under news analysis to find all the various updates myself my colleagues on the analyst team produce and Publish so tomorrow we have the brexit plan B debates So as I was just saying about volatility and starting it is to be expected On Thursday, we have first quarter figures from Apple on Wednesday. We have Fourth quarter figures from Facebook Wednesday, we also have the Fed reserve meeting even though nothing is expected to keep an eye off for the press conference to follow It's likely to be More of a continuation of the recent kind of you know neutral to kind of dovish language Or it is less hawkish than the previous language we've heard from the Fed You deliver have full your figures out on Thursday the as you have half your figures out on Thursday We have Amazon reporting of their for their fourth quarter numbers on Thursday on Friday. We have the Eurozone CPI numbers We also have a raft of you know, manufacturing PMI reports around the globe on Friday, and then also Probably the most important update of the month. We have US down from perils on Friday So please keep an eye out for that If you've any comments to make on this video or any of the other videos we've made here at CMC markets Please feel free to never view and cook reviews, and that's all for this week. Thank you very much