 Welcome to Tickmill Weekly Market Outlook for week commencing the 27th of July with me Patrick Munley. Mountain tensions between the US and China have contributed to a halting in the risk-on rally but have equally failed to trigger any substantial correction as equities continue to treat geopolitics with a good dose of complacency. Coming week will likely test such approach as tensions may escalate to a point where the US trade the US-China trade deal appears jeopardized and bulls will know to be pinned some hopes and positive developments on the US fiscal stimulus front and on the ability of the Fed to once again prove market supportive. The dollar will remain tied to risk sentiment swings although more bad data will get us second quarter GDP figures this week along with the key jobless gains may put a lid on the ability to for risk to rally further. Also we have bipartisan talks around the next US fiscal stimulus bill and they're set to enter a pivotal phase. Republicans have delayed the announcement of their stimulus package till this week at the end of which the $600 payouts are set to expire. Some reports suggest the intention to bridge the existing payments so that they get reduced but not entirely cancelled. Although this could hold investors' nerves for a little longer the size and content of the timing of the stimulus package will be the key driver for market sentiment in the coming weeks. Turning to the Fed meeting, look for the Fed to remain a little interest in terms of the FMC to display any hawkish tilt in their message especially given fresh lockdown measures and concerning jobs data. A reaction at the bank's cognitive stance appears nothing less than what the markets and the dollar are pricing in and so suspect a somewhat limited impact from the meeting. From a technical perspective the dollar index whilst we hold below 9496 resistance I'm looking for a move down to trust to test projected descending trend line support down to the 9250 area. The historic agreement on the EU recovery fund has helped the euro strengthen significantly. Moving ahead the notion of fresh solidarity within the union creates a positive environment for the euro to cash in on one more on the more dollar weakness with the latter likely to remain the driver of future upside for the pair. In this week's European calendar the second quarter growth numbers will take centre stage where a bad reach should still be mitigated by the price of recovery prospects after thanks to the European recovery fund. Along with the German EFO indicator which is expected to confirm the improvement and sentiment shown in the market PMI surveys which are released today inflation numbers will also be watched although the implications in monetary policy terms are still to be very limited. From the technical perspective as the euro holds above this 116 now I'm looking for a move to test the policy objective at the 118 area from there I've looked for a pullback profit taking pullback to retest 115 ascending trend line support. In terms of sterling no progress on the UK-EU trade negotiations is expected and with the news headlines suggesting an increased perceived probability of a no deal there's little to be optimistic about at this stage. It's very quiet week on the UK data front although sterling reaction to positive economic data has been fairly muted in the overriding importance of the UK-EU trade negotiations. Sterling price action in response to solid June retail sales and July PMIs have really proved that case really. From a technical perspective now looking for sterling as we hold above 127.50 I'm looking for a move to test the equality objective at 128.93 once we get into this area I'll be looking for a profit taking pullback to retest 127 as support. The yen appears to be gaining momentum as geopolitical tensions emerge and there are rally and risk assets seems to be stalling. In particular there looks to be some room for the yen to emerge as the most attractive safe haven option in the G10 in the current environment. Indeed the dollar has to deal with the combination of an unsupported data flow and set to get worse according to most economists in a dramatic virus situation which appear to have the potential to partly curb the benefits of risk off. The other safe haven in the swissie still be facing the negatives of improving sentiment in the eurozone. Should US China tensions continue to evolve in a worrying direction and in particular if trade concerns creep back into investors radars expect the yen to be the main beneficiary in short term. From a technical perspective whilst we hold resistance now at the 106.30 area I'm looking for a move down to test the major equality objective down towards the 104 handle. From there we could see a more significant profit taking move which would bring us back into retest the 106 from below. Finally in Australia the boost from the risk on rally and are still very relaxed Reserve Bank of Australia comments around the strength of the Aussie have now worn off. If market sentiment fails to show you another proof of extraordinary resilience this week the Aussie appears to be the most vulnerable to a downside corrections due to its highest correlation to the G10 effects to the Chinese one. Lingering virus emergency situations in Australia and a worse thing when covering outlook. Data wise inflation numbers for the second quarter will stand out. The risk of a negative year on year read appears quite material although the implications of the RBA monetary policy stance are not at this stage going to be impacted. From a technical perspective whilst we trade above the 70 70 level I'm now looking for a move to test the 72 85 from there I look for a profit taking pullback to test the 69 88 as support and that concludes the weekly market outlook for week commencing the 27th of July.