 Good morning and welcome to the weekly market update with me David Madden. Today's date is Monday the 22nd of June 2020 and the time has just gone 1155 British summer time and it's been a bit of a whippy morning This morning so far on European trading European equity trading The major indices started off lower, but then as the morning progressed We did see a bit of a push higher at one point They're all showing modest gains and now we appear to have fallen back ever so slightly into the red US trading cash trading in the over New York is going to get underway in about two and a half hours time Respecting a little a slightly negative open for the for the cash trading session over New York And if the major kind of theme over the last 48 hours or the last 72 hours has been that there's been a Sadly an increase in the number of cases of COVID-19 Countries like various different states in the US and countries like Germany, India, China Have all increased have all registered an increase in new cases and that appears that that is kind of it appears That traders are wrestling with that. That's why when things got going First thing here in this morning in Europe, you know, quite a few of the industries were down You know, I don't nearly a percent or over percent then they're back in positive territory now They're back ever so slightly again It seems to me that there is clearly concerns about the hella crisis, which is which is very valid Because if economies are reopening we're likely to have a scenario of increased cases But I think also traders are starting to kind of wrestle with the idea You can't stay on lockdown forever. And if you do reopen the economy, you're going to have some sort of You're gonna have some sort of an increase in cases and provided that doesn't spiral out of control And we wound wind up like in a scenario we were in in late February March when The coronavirus the COVID-19 crisis was spreading like wildfire We may have a bit more tempered reaction from the markets that being said There's also been an absence of really positive news to kind of drive markets on higher from here So that's been kind of the major kind of story in the major moves. We've seen in the last few hours trading What I'll do now is I'll quickly take a look at the week ahead article Which can be found on our website if you go to cmcmarkers.com and under insights you visit you Find the the news and analysis tab. So take a look through here. What can we expect out tomorrow? France, Germany and the UK have the flash and the flash PMI reports Excuse me manufacturing and what have you and services Coming up tomorrow. That's gonna make it give a very clear indication of what's going on in terms of The economies of you know, some of the biggest countries These economies in Europe France, Germany and the UK on Wednesday. We have full your figures from stagecoach The UK transport company Excuse me also Wednesday. We have the German IFO basis climate reading Thursday, we have full your numbers out from raw mail group Keep an eye on their process in every section in regards to those numbers Dardan restaurants over in the US that will have their full quarter numbers out Their outlook is going to be very interesting given what's going on in relation to the reopening of of the of the various different US state economies Like like you have fourth quarter numbers coming out on Thursday Also on Thursday, we have the final reading of the US GDP for the first quarter We also have US banks are going to be in focus as the the stress test of US banks will be published And then also what we do have is on Friday We have first quarter numbers a trade a first quarter trading update from Tesco And then lastly, we have US personal spending. So obviously that's going to be Very close to watch see actually how much appetite there is Freshly to go out and actually spend money and keep in mind we see a very decent Rebound in US retail sales not that long ago So for viewers who regularly watch this video I'll start off now with a few of the major indices Then I look at a couple of a few of the big currency pairs and then lastly I wrap things up with some commodities So starting off with the FTSE 100 we can see at the wider view And this has come across all the major indices has been an upward trend for the last number of months since late March We could see here that we're comfortably above the 50 moving average is blue line along here That comes into play just north of 6,000 because we're currently at 6,276 there thereabouts Even though we're off the highs of early of early June and we're below the turn to moving average The wider upward trend of the last few months is still in play And if we're pretty much right on the 100 in moving average at the moment at 6275 If you if we can manage to get back above that and then you potentially build that use that as these Support line support area to get a springboard board on higher We could then be looking at targeting the highs of early June in around 6,513 and if you go beyond that we could then be looking at the next big level to keep an eye for Will be this red line here the two-day moving average and that comes in the play just south of 6,800 Notice how the 50 moving average acted nicely as support here in the middle of June So that area could act as support yet again should we have a move lower from here And if you do have a decent break below the level seen here On the mid-June at 60 50 if you do have a decent break below that Got tickets could take us back towards the psychology Portland 6,000 area and a move below that could take us back toward This is all here down around 5,800 It is a reasonably similar picture with the Dax Whereby we've seen a nice decent move higher from late March through January where we hit a through January through June Early June where we hit a three month high. We've had the pullback We seem to be kind of dancing around this area here This red line two or two moving average. We're holding a but we're holding in around 12,800 sorry, I think 12,286 currently We seem to be hanging around the 20 moving average But while we hold above it is like it at the wider upward trend of the last few months is going to continue I should that be the case We're gonna be looking at retesting the high scene in in the first week or so are there early first week a week and a half of June and I'll be up towards 12,930 and if you go beyond that we will then be setting new multi-month highs and we've then potentially be looking towards 13,000 if you do have a fairly size of the break below the turn to moving average here Which comes as a pretty much on this level here in around 12,280 out Maybe but below that we could be looking at heading back towards the water to move the average in this yellow line here Because we can see it acted nicely as support in early June But we can also see that the 100 moving average almost Overlaps with the 50 moving average this yellow line here, which in a few occasions acted nicely as support So this area here could be of interest Should we see a further decline should we should we have a Fairly decent move to the downside in the next we could see potentially buyers step into the fold should the market Head down towards here and that comes into play in around 11,371 now the reason why I say it could be of interest is because if metrics have been Actually as nicely as support in the past it makes it more likely that they will do in the future But of course there are no guarantees. I will have a look at the S&P 500 now but of a common Theme here whereby we've seen a decent move in the in the index from the from mid to late March through the high to a high is being achieved in early early ish June Where we saw them the market hit its highest level since February so had a multi-month high We can see here that the market even though as Move to the downside it found support rebounded but yet we haven't taken out the reason high So it seems to me that if you can hold above this red line here The turn to moving average at 3023 the wider upper trend should remain intact and should that be the case What we can do is let's move this box should that be the case We could see the wider upper trend move intact So we could look at retesting in 3200 and if you go beyond that the highs of Early June are 3,232 and if you go beyond that we could then be looking heading up towards 3,350 If in the other hand though, we have a fairly decent move to the downside and the S&P 500 support could come into play from this yellow line Here the one or two moving average at 2,930 once again We can see how it acts nicely as resistance in late May It also acted as support in kind of you know in late May and acted as support yet again in early June So was again if a metric is a history of the acting as support and no resistance It makes it more likely that it will do so again in the future And if you do have a fairly decent break below that we could then be looking heading down towards the 2800 area I'll take a look now on a couple of the big currency pairs. What's going on with the with the euro versus the US dollar? So One of the common themes of the last few weeks has been that the US dollar is often done Well, whenever there's been a bit of uncertainty in stocks and commodities So we've seen the dollar act as a bit of a risk-off play can conversely We've there's been a few occasions when quite a few occasions when stock markets and metals have been strong and likewise And on the flip side of that has been the dollar has been weak So when stock markets were driving higher hitting their kind of multi-month highs in early June What do we see here? We saw the euro gain considerable ground versus the US dollar and to electric cent the pound as well But we seem to have given up a fair bit of a chunk of that ground that was that was that was gained between Basically between mid-mid early to mid-June early to mid-May into into mid-June So we had a decent rally here for a month. We've pulled back now We seem to be in this kind of consolidation zone here in around one spot 12 on euro dollar If we could hold above that metric the wider upper trend of the last few weeks could continue And we could look at kind of heading towards one of 14 targeting We look to head towards one of 14 22 the highs of June and if you go beyond that we could then be looking at targeting the highs of March inner one of 14 95 On the flip side if you do have a fairly decent move to the downside I mean we have a decent break below the 112 area It could take us back toward this red line here determine the moving average notice How it acted as a as a resistance on a couple of occasions not too long ago So that that metric committed to play in around the one spot 10 28 area So keep an eye on one spot 10 and 28 if we have should we have a decent break below 112 Like I was saying there's been a very common theme recently has been that the the dollar has as before performed As seen a bit of a seen a bit of ground being gained whenever stocks have been weak So if you take a look at the price action here on pound dollar We can see here that in a multi-month high in In early June when the when the dollar was weak But we have been kind of pressing lower on the greenback on the on the on the pound versus the dollar the last few sessions We're below the what the purity moving average the wanted moving average and the 50 So that the sentiment at the moment isn't looking too great for the pound starting So if we continue to press or press lower from here We could be looking a target in this area the lows of mid-May in around one spot 21 63 If you go below that we could be looking ahead heading towards the lows of mid-May Down around one spot 20 76 and if you go below that we could be heading down towards 120 If in the on the flip side though if we do see a turnaround the sentiment and it does look to kind of retake the purity moving average this red line here in at one spot 2685 notice how it the market tried to get above it on the 16th of June, but it couldn't So that this is likely to be an area of resistance should be moved to the upside again If you can get back above that we could be looking at targeting the highs of mid-June in at one spot 2313 and if you go beyond that we could be looking heading up towards the psychology Portland 130 mark Take a look now what's going on in the gold market gold is doing quite well Gold is currently trading at 1748 we're not too far away from the highs of from the highs of mid-May, which is 17 65 I keep mine 70 65 was the highest level in over seven years It was about a seven year seven and a half year high there they're about so sentiment is quite strong on the gold market Notice how the last few sessions the market has been ticking higher This blue line here of the fifth of the moving average in at 1717 is actually nicely a support while we hold about that It's likely that the the recent upward trend could continue and we could be looking at targeting 1765 and if you go beyond that We then we would be in new multi-year high territories and we could be looking at you know We love people talking about 1800 not long after that If you do though break below 1770 the 50 the fifth of the moving average We might find support coming to play at the big psychological number of 1700 and even if you go below that We could be looking at heading back down towards the lows in early June in a 1670 That's only really if you have a size of great below 1670 Then we'd be creating multi-month lows would then we begin to think okay Maybe gold is a bit as it could lose further ground from here But for the time being it seems to be that goes in a fairly strong upward trend Now lastly, I'll take a look at Brent crude over the August contract The oil market has been in decent shape recently kind of ties in with the idea of economies reopening People perceptions about demand are changing as well We're getting you know OPEC plus I've pledged to have even better compliance rates with the very deep and historic Production cuts that they currently have in place. So we can see here that has been rebounding the last few months So it's gaining gaining back some ground. We can see here has been pushing hard the last two sessions The highs of the last few days haven't gotten gotten quite up to the highs of the early June But we're not too far away from it. So if you take out the highs of June here We could be looking at targeting the lows of of March with this gap was created in around 46 dollars a barrel That's that's that's the kind of the near-term target should the bullish trend continue If you do drift if you do drift lower from here support could be found from this zone here the lows of mid-June in Around 37 dollars a barrel and even if you go below that We could find support from this blue line here the 50 moving average and that comes into play at 34 dollars It's about a 59 cents. I appreciate your time for listening to me today. Stay safe. Have a good trading week and good luck