 Hello and welcome to CMC Markets on Tuesday, the 23rd of June and the weekly market update. And we're coming off the back of four successive weeks of declines in European markets, Euro stocks 50, the DAX. But we've seen a significant change in sentiment in the last couple of days. Massive rebounds both in the Euro stocks 50 and the German DAX. And it's largely on an expectation that we could well get a Greek debt deal in the next few days. Now, you know, putting to one side the likelihood of a successful outcome to these Greek debt talks, going to look at some of the key resistance levels that we need to overcome to give some indication that we've reversed the declines that we've seen in European markets and whether or not the rally that we've seen over the past few days is merely a dead cap bounce or whether it's a significant rebound and turnaround in sentiment that we've seen from the past three or four weeks. Then going to move on to the recovery that we've seen in the last couple of days in the dollar. The dollar has been particularly weak over the past few weeks, but there does seem to be, again, some evidence of a potential turnaround in sentiment. And I think that does appear to be a little bit strange given last week's Fed meeting. It was certainly more dovish than I think most people had expected, but it's the inability, I think, of the Euro dollar to go back through 115 and the pound to significantly push much beyond 159 that could well signify, or signal even, a turnaround, a rebound in the dollar and a little bit of Euro and sterling weakness. So in that context, then we're going to look at the cable and look at the prospects of a little bit of a reversal from the rally that we've seen from the lows of 145.65. So let's make a start with the Euro stocks 50, and we're going to be using the same chart that I've used for quite some weeks. Now it's the daily cash chart, and since April, since the April highs, we've been trading in a significant downtrend, a downward channel. Now on the Euro stocks 50, we've broken above that channel. Now cast your mind back a few weeks, and you'll recall we saw a similar sort of breakout on the German DAX, but it was not confirmed on the Euro stocks 50, and subsequently we turned lower. Now this particular breakout is on the Euro stocks 50, but it's not being confirmed on the German DAX. And as with DAO theory, it's always a recurrent theme when I look at markets and look for correlations, particularly in European markets. I like to see a confirmation of a breakout confirmed on both particular markets. Now on this Euro stocks 50 chart, we can see that we have broken above the trend line resistance from the April highs, and we've rebounded off the 200 day moving average earlier this month. But if we move on to the Germany 30, the German DAX, we can see that at the moment, for the moment, the downtrend line, channel line resistance from the April highs, we haven't as yet broken above it. So I think for any significant confidence that we're going to get a significant rebound in the Euro stocks 50, then we'll quickly move back to that chart. If you look at the horizontal line that I've drawn through the May highs around about 3,700, what I would hope to see for a turnaround in sentiment on the Euro stocks 50 is a breakthrough 3,700. And that in itself should pull the DAX through its upper resistance line and its pullback line resistance from the break of the downtrend line that we saw in the end of May, the beginning of June. So we're at a very, very key inflection point in respect of the German DAX because we have two intersecting lines that could well act as a cap for any future gains going forward. So where we are currently at the moment on the German DAX is a very, very key level in the context of the overall direction of the current down move that we've seen since the April highs. I'm going to finish up by looking at the pound against the dollar. In the context of last week's Fed rate meeting we got another growth downgrade from the Federal Reserve and we saw the US dollar hit its lowest levels in quite some months but since then we've seen a little bit of a rebound and that is somewhat perplexing given the fact that the Fed downgraded its growth forecasts for the second time this year. But given the fact that markets think that potentially this Greek debt crisis or Greek debt story is potentially going to get resolved in the coming days markets are now focusing on the timing of the next Fed rate hike whenever that comes and at the moment we're seeing a little bit of dollar strength. Now we can see from this weekly chart, the pound against the dollar that there's significant resistance between 158.80 and 159. Now the reason there's significant resistance there is twofold. We've got a 50% retracement level of 158.80 from the highs in 2014 at 171.95 to the lows earlier this year at 145.65. That level around about 159 also happens to be a 50% retracement of that move as well as being the 200 week moving average. So it's a very, very big chart point. More importantly, given the extent of the rebound that we've seen off the 145.65 lows is the daily candle pattern that we saw at the end of last week and that does appear to suggest that we could be in for a bout of some sterling weakness over the course of the next few sessions. If we look at the way those last three candles which I've circled have basically coalesced around each other, there is a suggestion that having broken below 158.10.20 we could be in for a little bit of sterling weakness and the oscillators also would appear to suggest that that is the case as well. We do have plenty of scope to go lower without actually undermining the uptrend that we've been in since the lows that we saw in April earlier this year. So we could certainly go back towards the 200 day moving average which is the purple line that's basically coming in around about 154.50 and we've also got the 100 and 200 sorry, the 100 and the 50 day moving averages also pointing higher. So judging by that daily chart there's certainly potential for a little bit more sterling weakness, a bit more dollar strength but we also have to be aware that there is a significant amount of US data that could affect this sterling dollar move over the course of the next two or three days. We've got US inflation data out on Thursday, we've got the final US GDP revision out on Wednesday. Either one of those data items could be equally dollar supportive or dollar negative but overall I still think that the pound against the dollar will likely remain in its current uptrend but there is certainly scope based on that particular chart that we could well see and move back towards 155 initially and potentially 154 and the 200 day moving average. We need to get back above 158.20 to suggest that we could get a revisit of the highs earlier this month around 159.30. So that's it for this week. Once again thanks very much for listening. I'll just take this opportunity to remind you ladies and gentlemen that next week's non-farm payrolls webinar will be on a Thursday. Not a Friday, because Friday is a US holiday. Thursday the 2nd of July. 115 to 145. So if you want to attend that, it's on the Thursday. Sign up along the bottom here. Until next Tuesday's weekly market update, thanks very much for listening. This is Michael Huston talking to you from CMC Markets.