 Good morning and welcome to the weekly market update with me David Madden. Today's date is Monday the 3rd of August 2020 and the time has just gone 8 59 British summer time And the top and it's been a fairly mixed start to the European session We've seen losses here in London France and Italy while we are seeing a positive move to over in Germany There's been a few stories going around the last few days. Obviously the coronavirus crisis is still it's in a major issue number of case numbers is on the rise various different countries are re-imposing or pausing re-imposing restrictions or pausing the reopening of their economies The last we've heard over in the US the one trillion dollar stimulus package has not been agreed upon yet the Republicans and Democrats are still going back and forth from that HSBC and the the biggest bank in Europe they posted their numbers out this morning second quarter first half numbers The second quarter loan impairment the provisions for bad debts was larger than expected So a very kind of common theme of both the European and US banks this reporting season Also US China trade relations continue to be on the radar. We heard over the last two days Mike Pompeo the US Secretary of State Talks about how the Trump administration is going to potentially looking to target quote an array of Chinese state-controlled software companies and the last 12 hours, we've had a very different manufacturing reports We've had a kaishin survey of Chinese manufacturing that came in better than expected and showed a decent increase on the month And we've had a very different eurozone economies Spain Italy France Germany both their manufacturing numbers and all of those showed you know nice increases on the month So it's clear that the at the global I know the manufacturing sectors of major economies it continues to to rebound As always with the weekly market update, I run through the week ahead Then I run through some popular markets indices currencies As I mentioned manufacturing building that a faction PMI reports Today as with the HSBC figures Looking ahead to tomorrow. We have first half results from BP We also have Q3 numbers from Disney We also have the reserve back of Australia have their interest rate meeting on Wednesday We will have the service PMI reports the major economies of the world We'll also have the first half numbers from Metro Bank on Thursday We're going to have the Bank of England Interest privatization on Thursday. We also have first half numbers from ITB Friday. We have first half numbers from the city world And then and big one to watch out for on Friday is of course going to be the US non-farm payrolls report It's often deemed to be the most important update of the month of the month. So please keep an eye on that Turning our attention now to the indices starting off the foots you and under it We could see here the last few Just a couple of months basically because it's this the high here of you know We can see the high here in early to mid-June We have a move lower a rebound here the markets really couldn't get get a you know get get that much beyond the 6300 you know up to 6,340 odd Start to move lower again, you know in the last couple sessions we've fallen back to levels last seen in late May We're drifting lower here. You know we're currently at you know 5,905 so we're below the psychology important six thousand mark while we remain the below the psychology important 6,000 marked. It's like if you could see further losses from here I could you press the lower from here? We could be looking any back down toward this zone here down around five thousand eight hundred If you have a size of break below that we could head down toward this zone here around five thousand six hundred and sixty Move to the upside could occur resistance From the psychology born six thousand metric and if you go beyond that it could be heading up toward this blue line here The fifth of the moving average which comes into play just south of six thousand two hundred Notice how on a few occasions That's not a go in you know in June. We saw that this blue line the fifth of the moving average act nicely as support We saw some consolidation in From the area from the metric around that metric in the middle of July Submetric has been important in the past. It makes it more likely it will be of importance in the future Although there are no guarantees So you know what's going on over in Germany on the tax So the wider view has been that the German market has been quite strong. We said a multi-month high in in late July since then it was the highest level seen since Since but basically when the when the when the With the coronavirus crisis quick kicked off. It was the highest level seen since late late February Notice how you can moving steadily lower in the last two sessions This red line here the turn of the moving average acted nicely as support only on Friday that comes into play 12,000 two to six while we hold above that It's likely that we could see the the wider upward trend continue And if you press on higher from here, we could be heading towards 12,600 you know this is not a consolidation in that area and if you go beyond 5600 you can head up for this zone here around 12,900 we can see that you know that area active resistance on a few occasions there there abouts To keep an eye for that if middle hand though, we do have a break below The turn to moving average we could be then hey down down forwards 12,000 you know it's big psychology number and perhaps even a bit below us You know if you take up you look at the loads of late June Down around eleven thousand nine hundred and fifty six there there abouts to keep an eye out for 12,000 and also eleven thousand nine hundred and fifty six be there there abouts I wish now take a look what's going on over in the US starting off the Dow Jones So the Dow Jones in In June his highest level So But it's been concerning that we haven't really gaining any ground to the upside Like the last few last few sessions. We've been drifting it at lower We're heading back down towards with both the turning moving average the red line here and the fifth of the moving average The blue line here while we hold above those metrics and the document to play In around the same area in around The turn the moving average comes into play at twenty six thousand two hundred forty one the fifth of the moving average comes to play at Twenty six thousand one hundred and sixty there they're abouts while we hold Above above both those metrics. It's likely we could see the wider up and trying to do you Cooper looking at retesting twenty seven twenty seven thousand and if you go beyond that Recuperating and targeting we could be retesting the early June highs in around twenty seven thousand six hundred and thirty three But if you do have a decent break below those metrics, you could take us back down towards the mid with early July low In a twenty five thousand four hundred and eighteen this area here And if you have a break below that, you could take us back down towards the kind of psychological important twenty five thousand number Take a look at the S&P five hundred on the S&P five hundred is forming As I've performed the previous markets we can see here and not only has it been in a solid upward trend basically since late March The the gains that has been making have actually been higher and higher So the levels that we've seen in the last two days have been kind of effectively kind of multi-month highs The highest that we saw 28 the high Well, she actually that quite isn't isn't quite true about I apologize for that the highs that we saw last week Was in or on the region of three thousand two hundred and ninety five On the 23rd of July three thousand two hundred ninety two the highs that we saw last last week We're not too far away from that three thousand two hundred and eighty So we're not too far away from the multi-month highs that were set on the twenty third of July So we're still in the upper trend if we press on higher from here We could be looking at targeting three thousand three hundred and if you go beyond that We could then be looking heading up towards three thousand three hundred and fifty. You keep in mind We haven't really seen these levels Since you know mid-fabri essentially when the kind of coronavirus crisis really kind of ramped up as far as Western stock markets are concerned If you do move to the downside, you could see fresh fires out of the fold because let's face it Buying on the dip has been a popular strategy the last few months So if you move lower from here We could be looking at targeting this area here in around three thousand two hundred We could see on a few occasions the metric active lice here support And even if you go even if you go but below that we could see support coming to play from this blue line here The fifthly moving average it actually lice your support on a few occasions in in June and that metric comes into play three thousand one hundred and forty eight take a look now at the Come a currency pair starting off Euro dollar So one of the kind of common themes recently has been the kind of the weakness in the US dollar The US dollar index not to know a goal at its highest level, but it is low level rather in over two years So it's a very it's in pretty poor shape Conversely the euros game ground euro, you know inversely the other side of the coin Euro dollar hit its highest level in over two years. We also saw decent gains be made in British pound as well We can see here that the level that was there was so initially at the highs of Friday on your dollar were the highs in over two years But we've noticed how we have you know the long week on the Friday's candle, you know the notes in decision You know, we move lower again after we've had a basically fantastic run the last few weeks So we could be in for a correction It could be in for a bit of a pullback on your dollar And you know should that be the case because we're currently trading in around one spot 1770 We feel like you're heading back down towards You know, you know once one spot 17 or maybe even the kind of one spot 16 zone to be honest It's in such a strong upper trend Even if you go go all the way back to gonna one 14 where you can see that this is overacted broadly speaking of resistance in early to mid-June If you do press online from here as you know Friday's high which comes in play in around one spot 19 away If you go beyond that, you know the next big number that I go for will of course be once about 20 So we'll take a look now on what's going on a pound versus the US dollar like I said weakness in the dollar has been a common theme recently, but Sim restoration is on on Friday. It is highest level and in four and a half months You know go over four months going on five months. We can see here They know that the shape of this candle here the long wait on us to know it's a bit of a decision Once again, this is it would also suggest indecision the shape of this of today's candle So we could be in for a period of maybe drifting a bit lower giving back some of the ground That is the case. We could potentially like a head back down towards 130 That's gonna it's a big number as far as your your dollar is sorry pound dollar is concerned And if you do press on lower from there We could even go all the way back towards, you know 128 or even all the way back potentially to the 200 a moving average unit one spot 2702 and maybe you know even if we to go back all the all this disparack we will still remain kind of in the upward trend If we continue to hold above the kind of 130 level, I would kind of bode well for four pounds for a Pound dollar and then we could be looking at retesting the 130 area Or even go beyond that up towards Towards once about 30 82 you can see here 130 acted nicely and a few occasions as resistance One spot 32 that area actually the resistance and a few occasions to pound for pound dollar And even if you go beyond 132 we could be looking at targeting the highs of December last year in at once about 32 84 Lastly, I'll take a look at some quality starting off with gold Gold has been on a phenomenon recently Only even today yet again another new all-time high we just about geeked out on the gold market We're currently you have retrieved Refreest you have retreated small bit We're currently at 1972, you know, so it's like I actually the next day is all focused on the $2,000 mark and of course if you go beyond two thousand bucks, you know It's likely that the the positive trend is going to continue If we do see a bit of a move to the downside in gold support group of the zone here in at 1940 and if you go below that it could be heading back down towards 1900 and if you go below that we could be head back on towards 1863 But like I said, we're in a phenomenal upward very strong overtrend, you know, we could go back all the way back to you know 1800 and still be and still not have broken the upward trend So gold continues to be quite good shape keep an eye what's going on with the US dollar And in the last few weeks and months, there's been a very strong inverse relationship between the two and the recent weakness in gold has been It's been very beneficial that weakness in the US dollar has been very beneficial to gold So keep your argument trading gold keep an eye on greenback. Lastly, I'll take a look at oil I'll start to take a look at Brent crude oil the October contract so First things first since late April, we can see it's been a nice upward trend In mid to late July in a four month high. So the trend is the The trend is clearly to the upside the last few sessions I've been a bit a bit of a boring but it maintains it's considered to be in the uptrend and we're currently at 43 dollars spot You know 15 cents if you continue to press on higher from where and if you take off the region highs We could be looking at targeting at this area here the early May early March you out And that comes into play at 46 dollars and it's 67 cents If you know if we get that's that keep an eye out keep an eye left to the upside And if you go beyond that we could then be looking heading towards the you know 50 bucks per barrel area If you do see the bit of a drip lower We could see support come come into play from this blue line here They fit the movie average and that comes into play 41 spot 84 We can see how active as nicely as support only on Thursday just gone And you know the metric has been important in the past it makes it more likely it will be important in the future And if you go below that you could we could see support coming to play from the 40 bucks bar region You know, it's good. It's a big number and then also we could see how nicely it actually a support previously Thank you for listening. That's all from this in this week. Stay safe. Have a good Friday week and good luck