 Good afternoon and welcome to the Monday market update with me David Madden Today's date is Monday the 16th of March 2020 and the time has just gone 1215 GMT And it's been yet another horrendous week in the financial markets There's loads going on volatility is absolutely through the roof. We're seeing asset classes of all sorts just being dumped There's been a massive array of news and information out in the last 24 hours 48 hours But here are the highlights. We've had some dreadful figures out of China and overnight Retail sales dropped by over 20 percent Industrial production declined by 13.5 percent Fixed asset investment declined by 24.5 percent now bearing in mind China These are these are the stats from the time period when China was on full lockdown So traders are fearful the appalling economic indicators that we saw at a China overnight Is going to be what countries in Europe and possibly North America are having the pipeline if If countries, you know Italy's on lockdown and the likes of Spain same scenario if you're innocent if we go down the Lockdown route of several more countries in the west. We could see You know massive massive decline in economic activity and that has been reflected in the huge falls. We've been seeing in European stock markets Another news the Fed of Reserve took the drastic decision To slash interest rates almost to zero. They're down at rock bottom levels They also announced a quantitative easing program of 700 billion dollars the reserve bank of australia slash interest rates We've had interest rates cuts From south korea as well There is pencil in tomorrow The european union are going to have a coordinated conference call in relation to have to deal with this issue We've had center banks Do extreme measures to try and calm the markets, but in fact we actually had the opposite response Um What i'll quickly do is i'll just very briefly go on the week ahead article and then i'll be focusing on the charts The week ahead can be found on our website cmsi markets.com new to analysis You'll find it. So i talked already about the china figures We have first-time figures from furgestons tomorrow uk unemployment And and and average earnings are going to be out on tuesday. We have the german zeddy w figures No dot the economic sentiment on tuesday. No doubt. They're going to be um, they're going to want to watch to say the least FedEx have their court numbers out on tuesday The fed of reserve have their interest rate decision on on wednesday, but then again, we have uh, we all know um What we well, we all know the fed reserve have already done um We have similar similar updates from the likes um of japan and switzerland, but you know Many many of these organizations have already made it clear. Uh, what actions they're taking Um, a cattle a first quarter numbers out on on thursday We have darden reston's group have third quarter numbers coming out on thursday And we have first-time figures from jd witherspoon on friday What's interesting about the these latter two companies is that if you're the services trade or you're the kind of leisure trade Leisure industry if we do get on the route of lockdown Fewer people are likely to be going out to pubs and going out to restaurants So the updates for the outlook from these two companies could be of significant interest I'll take a look now, uh starting off with the indices footsie the footsie 100 We just Talk about the levels we're currently at. We are currently sub 5000 on the footsie 100. So it's absolutely Painful sell-off yet again As you can see in the last few weeks and months We've been in a very aggressive downward trend while we hold below the kind of psychology important 5,000 mark it's likely that we could see further losses if we do push on lower from here We could be looking at it down towards 4,800 If you do a bit of a snapback and if you can get back above 5,000 and we can build from there We could potentially find some sort of the Market might run into resistance in around this zone here 5,200 there's a couple of vacations at that price area broadly speaking So I provide a support So if the it's possible that the old support might become new resistance But it is worth noting the amount of people the amount of fear Panic and uncertainty that's running through the financial markets at the moment Taking a look at what's going on over in Germany Similar situation there. It's been an aggressive downward trend Basically for the last month or three and a half weeks Moving absolutely sharp sharp sharpie lower We're currently sub 8400 on the dachs and we're moving aggressively lower If you continue to press on higher lower from here We could be looking at our getting sub 8100 back towards 8,094 This is a level last seen in august 2013 So if you press on lower from here, we could be looking at our getting 8,094 And if you go below that the psychology important 8,000 Would then come on the radar If you do have a bounce back a rebound in in the dachs Resistance could come into play in around the kind of psychology important 9000 mark keep mind we're about we're over 600 points away from that level But we have seen volatile swings If you go north of 9,000 this area here that This zone here in around 9,364 could then act as a possible area of resistance What I do now is I take a look at gold We've seen Even gold is losing ground There there is there is talk out there that equity traders traders Are taking Are taking hits In relation to equity equity markets are looking to cash in their assets Whatever assets that they still hold on to gold be one of those assets So the reports doing the rounds That gold Is taking the hit on the back of the fact that that some traders are looking to essentially liquidate whatever Actual assets that they have and look to kind of run towards cash run towards cash Um, it's also says a lot about financial markets Uh, whereby when you have a time when you have When you have a a major sell-off in A size of a sell-off in gold when it's typically known as to be a safe haven So when even the safe havens aren't so safe It really highlights the fear and uncertainty in the financial market So if you look to press on lower from here, we could be looking at targeting this zone here down around 1445 move below that could take us down towards 1430 If you do have a rebound, uh resistance might come into play from this red line here The eternity will be average which is just just south of the 1500 mark So it's a big psychological number as well. So that area between the eternity will be average and The 1500 mark I think could be an area of significance seeing as the traders it will be keeping keeping an eye on both those metrics I'll take a look now. What's going on on the on the oil markets The oil market has had a pretty terrible run as well recently Um, we can see there's been an aggressive move to the downside on the oil market It's at a it's Broadly speaking range bound the last few days, but that range has to be fair has been fairly wide Um, we can see here that we we haven't we've we're off the lows of last week But yet we're still a fair bit away from the highs of last week Um, if we can continue off the lows of next week as a possibility We could see we could see the market retest the highs of last week up around 36 spot 27 But on the flip side if we do take out the lows of last week We could be looking at you heading back down towards 25 spot 73 and this is on crew and this is on wti west texas intermediate If you do get if you do break above 36 spot 72 here that could put us on track towards 40 bucks per barrel That's I'll take a look now at Brent We can see here a similar situation on Brent But not notice how the lows and Brent today have taken up the lows of Brent last week So so it was suggest to me that the Sentiment is still very much bearish If you look to press on lower from here because we're currently around 30 spot 50 We could be looking at heading towards 30 bucks a barrel And if you go below that we could be looking at looking at testing 27 spot 13 A level last seen in January 2016. So I'll give you an indication of how How How bearish sentiment is in the oil market if you do have a A snapback if you do have a rebound resistance could come into play in around 39 spot 84 or up towards 40 bucks a barrel And then if you go beyond that I started to fill this gap We could then look to target the lows From the from friday the the closing level or the lows of friday the Sixth of march in around 45 spot 49 the lows or 45s by 83 the close I'll take a look now at the at the euro versus us dollar So euro dollar had a fantastic run between late late between late between late february And into the into the middle of march then we saw an aggressive move to the downside But notice how euro dollar They you know on a few occasions tried to get below this yellow line here the 100 We will be average in at 110 spot 67 a fail to get below that And if you can hold above that metric we could look at retesting the kind of the 112 area And then if you go beyond that we could be looking at heading back up towards 114 and then back up towards The the the march highs of in around kind of one spot 14 95 In terms of central bank action we've had Two size of an interest rate interest rate cuts from the Fed of reserve We've had no cuts from the european central bank The it might be now time for the european central bank to look at do so You know in a few weeks they could look to do some other drastic moves Um, they may they may do that they may not they may wait for european governments to to do something But we've had two moves in the from the from the fed reserve We've whereas you've had no moves from the european central bank. So that that's just something to uh to keep in mind I'll take a look now at pound dollar pound dollar has been an aggressive move to the downside um For the for the last a few training sessions in fact, we fell to a level today last seen Since october so give an indication of how bearish sentiment is If you look to press on lower from here on euro dollar, sorry pound dollar rather We could look at targeting this zone here down around one spot 21 95 If you rebound from here, we could be looking hanging back up towards this area here in a one spot 24 91 And of course if you take out the lows here of october We could then be looking at heading back down towards the psychology important 120 mark or even the lows that were seen in early september I'll lastly wrap things up with um dollar yen just because The japanese yen has done very well um out of the the health crisis is often seen as a Safe haven asset or safe haven play and that's precisely what we're seeing on today's session We're seeing uh, even though dollar yen broadly moved higher last week We did see a sharp move to the downside in today's training session And essentially while we hold below this red line here The maturity will be average and that comes into play at 108 spot 24 While we hold below that let that metric it's like that we can see further losses from here. So we could be looking at um Heading back down towards um Well, he could be looking at heading back down towards the lows of uh of uh of last february february the Sorry, apologies The the 13th march In around 103 spot 08 and if you go below that we could then be looking at our getting the 101 spot 91 area Now uh at the time of recording this video us index futures are in limit down So that that's why I haven't covered uh the us the dow and the s&p 500 on this particular video Um, the volatility is so high We could see intermittent trading uh on the likes of the the us 30 the s the s&p 500 The us small cap 2000 and the us nasdaq 100 And thank you for tuning in. Thank you for listening. Have a good training week and good luck