Theresa May's meaningful 3 vote delayed

Okay, good morning, it's Anthony here from the trading floor in London at Amplify. It's Tuesday the 19th of March, so we're going to have a conversation about what's been going on overnight. There's been some big updates on the Brexit front which could severely shape then, or alter at least some of the expectations around the timing of proceedings going forward over the coming days. That's really the main focal point. Then I'll hand you over to Sam as per usual, and he can look over the charts in a bit more detail from a technical point and a kind of trading setup point of view. But overall, things are relatively quiet. This has been quite reflective of general market conditions of late. The VIX has been kind of continuing to decline from some of the volatility, of course, that we saw at the end of 2018. Quite stark, different trading conditions at the moment. That's led to further kind of continuations of the grind up in, uh, in equity markets. I mean, if I just flick over here, let's just have a quick look at the, um, the S&P 500 for a second. Let me just readjust my, my chart here. So we did have some volatility during the actual session itself, but putting this back on a daily continuation, uh, I know Sam will look at this in more detail, but You can see here the area we were looking at before, this kind of trend line from that Q4 triple test, if you like, that came inside around the 2800 handle. But now that October 17th high acting as a really nice platform. Now you can see that ellipse there, and in these, these 4 occasions now which, which is tested on the resistance point, the eventual break and the gap up that we had recommencement of trade on Sunday night on Globex. And I think that's going to act as a real key level of a band of support around that 21 to kind of 25 price. So now we could kind of continue this gradual move higher, looking at this rectangle based on the previous price action from kind of summer of last year as a potential target. On that note, actually, there was this that I saw this morning. Uh, Credit Suisse, the Swiss bank, has boosted its year-end forecast for the S&P 500 to 3,025, a level that represents a 7% increase from Friday's close. So a couple things they're looking at at the moment, but predominantly the main macro drivers that they're putting behind this pretty punchy call, which is one of the most bullish on the street, is based on the the fact that they believe that the Fed will continue to remain supportive, i.e., relatively dovish in their tightening mode, um, and also that we'll get positive developments on the China-US trade talks. So yeah, just having a look where that's going to put us. I mean, let's just stretch this chart out so we can see that bigger picture price action, uh, that we've had. Well, let's just put that trend channel that we had on previously from the, the price action from last year, which is obviously very pivotal for this development over the best part of 2018 before that big shakeout at the end of last year. So where does that put us? Well, let's just have a look. 25 puts us, yeah, about that kind of level here. So this region is what we're looking at, about up here, which does make sense, I guess. I mean, that's that kind of trendline from the previous all-time high back at the beginning of 2018, the retest of that before before the collapse in September and October, a kind of double top. And so if you follow that trend line through, that would probably, given the timing, marry up with that level that Credit Suisse are looking for. I mean, 7% move. Yeah, I'm not sure. I mean, that's pretty, pretty bold. I would say I agree with the case of the trade war. Actually, you've been saying this yesterday. I do think that Trump will be actively looking to try and manage the stock market as we run into the 2020 kind of presidential election race. So I think that he will be relatively passive the more time goes on to try and facilitate that kind of price movement. The Federal Reserve though, I think that potentially could be problematic because if the equity market does continue to rally quite aggressively and market conditions remain relatively stable. Well, if economic data starts to stabilize— well, look, this is what I'm just looking at here. Thanks for reminding, guys. This is what I'm looking at here, is at what point then does the Fed then recommence its tightening and we actually get a bit of a repeat of what we had before. So yeah, this is what I'm looking at. The S&P— I know I wasn't clearly showing my charts there, so this is the bigger picture. Um, this was that trend line that I'm looking at here. That top larger size rectangle is the area of Credit Suisse's target that they're looking at for the S&P rally. And this is— don't forget, this is the year target in terms of the duration of when they think the market is going to get up to that, that point. So yeah, a couple things there to, to just be aware of. But the bigger story, of course, this morning has been based upon, uh, the developments on Brexit. Now if I have a look at the pound this morning, you can see here we have been rallying really since yesterday afternoon. Now yesterday afternoon I was actually off the desk, and Sam, this morning I asked him what was that little spike of price action, quite an extension on that wick there at around 3:30, and he said, well, that was when the House Speaker Bercow was was speaking. And when I read the news last night, I just thought, wow, I mean, that's got to be a sterling buy at that point. I mean, that pretty much sews it up. Either now Theresa May gets— goes back to Brussels, can say to them, well, look, we have to have a change now, a meaningful change in the text, in order for Parliament to even hear the new proposal for a deal to go through. So it's either that now or a long extension. And so either of which would be a net positive for the pound. And really since that point, price has come up almost a full 1 point now, appreciation in the pound. And I'll leave Sam to look at that technically in a bit more detail, but let's just run through the headlines and exactly what's happened here. This is Theresa May prepares to seek a long Brexit delay as the Speaker's sculper's plans. Obviously the House Speaker has come under an incredible amount of scrutiny. He's kind of been speculated before that he's kind of heavily in favour of the Remainers, and so therefore as a net result he tends to make decisions favouring that side of the argument. But I can kind of sympathise with his point. His position is to oversee and facilitate the talks within Westminster. And if you're going to just bring back a meaningful vote— and the talk was yesterday, a third time, if that fails maybe a fourth time— well then, you know, his job is to push these things along. So surely this is a prudent decision to say to the government, well, there's no point you doing this, I know exactly why you're doing it. And so either come back with a fresh deal, make some actual progress rather than just forcing a kind of political leverage. Yeah, let's just get the, get the show moving. So yeah, I mean, I guess there's arguments on both sides. Should he be really making that kind of bold call? Really, a lot of the balance of power does lie in his hands at this point. But yeah, I mean, this is— there's not really much more to this than that. Him now delaying that means that a meaningful vote which was penciled in to happen today is not going to happen. The fact of a meaningful vote happening then, last chance saloon on Wednesday, before Theresa May then goes to the European Council meeting in Brussels on Thursday and Friday, well, that's not going to happen either. So the meaningful vote now, if there is going to be one, will probably need to happen after now, um, her going there, speaking with European officials again, seeing whether she can get now another slight concession for them to come back for another vote early next week, for then literally last chance before the actual deadline on March 29th. Of course, there is some speculation was circling on Twitter yesterday that the EU members have been discussing an emergency summit to happen on the 28th of March, the day before we would effectively crash out if there were no agreed deal or authorization on an extension at that point. So yeah, this is going to the wire, let's, let's be clear about that. In terms of a potential delay, so let's say the deal then doesn't go through next week, well then the Sun newspaper was cited according to unidentified government sources, that Theresa May is drafting a letter to Donald Tusk, President of the EU Council, formally requesting a delay of 9 to 12 months. Now, I don't know, I think a little bit of this is Theresa May— if I was her, I would be drip-feeding in this type of information to The Sun. I wouldn't read too much into this. I wouldn't say that this is, wow, Theresa May 'Now gonna delay Brexit for 12 months.' This is a long period. I would see this more as she's purposefully leaked this to the press just to remind the Brexiteers that, 'Look, when I do come back with a deal, then just remember you've got to back it, otherwise you risk this potential long extension equating to a higher risk of a no Brexit at all.' So for me, this is tactfully done on behalf of the government to try and facilitate that kind of, again, leverage. The only problem that she wasn't banking on was that the House Speaker is not playing to the same tune. He has thrown a bit of a spanner in the works, but I still think that Europe will now respond and the UK will come back and will have a meaningful vote. And I still, at this point, think that the deal will get accepted at the very last kind of breath, if you like. Other headlines to be aware of on this front, on the Brexit side: Tory MPs, apparently again of the more Brexit persuasion, are saying they demand Theresa May's departure date in return for passing Brexit. So if you remember, um, that she's already said she would step aside at this point, she was clear about that several months ago. What these MPs are asking for is they want definitive details about the date of when she's going to leave. And then on the Labour side, they've now continued to say that they would not back the Prime Minister's deal, at least as it exists today. And so therefore they're kind of stepping up their backing for a second Brexit referendum. So basically everyone's doubling up on every side at the moment to try and, you know, push one another into making these these decisions for the moment. So yeah, I mean, that's the main kind of Brexit roundup. One thing that I was kind of looking at yesterday, and this might be useful for some of you, I'll just bring it up on my, my Twitter feed. So a couple people have already started asking me about what is the European Council meeting agenda as we go into the the second half of the week. So there's a full press media link here. It's the last tweet on my Twitter account, and if you look at it, the graphic, you can see, pinpoint minute by minute what exactly the movements are of their discussions. So it can be quite useful. But this is one of the main things I was saying yesterday, and I still stick by this. I mean, this was yesterday before the House Speaker spoke. He's kind of fitting now this narrative that I was just feeling yesterday that Theresa May might pull the meaningful vote anyway. This is kind of now being sped along by what's happened last night. And use the Thursday, Friday as a final attempt in talks with the EU. I'd say that's even more pressing of a point now for the EU potentially to come back with something a little more. This then give MPs no choice but to accept her deal early next week. Obviously, this is incredibly high risk or high-stake game that they're making, but I think that that's the point, um, the point of this. Now it just makes her deal all the more necessary to accept in the end. All right, a few other headlines to get you up to speed on, uh, then I'll hand you over to Sam. This is one about OPEC. If you remember yesterday I was talking about the weekend meeting in Baku, Azerbaijan, was the technical kind of meeting of where they— all ministers gather to talk about compliance and so on. Now, what Bloomberg are reporting this mo— this morning is that OPEC's missing meeting shows that Saudi and Russia oil alliance is feeling the strain. What they're saying here is that basically Saudi Arabia have been very vocal and committed to continuing the supply curbs in order to prop up prices. I was reading some analysis this morning, and according to Bloomberg's numbers, they now reckon for the government to balance out fiscally its spending going forward for the 2019 and beyond, that they need oil actually trading at 90. So obviously they're well offside in, in seeing that play out at the moment, and it's trading at obviously 59.50 type area. What Saudi have been saying, and where the discrepancy is coming in the communication at the moment, is Russia are very much at the point of view of we shouldn't really make any decisions right now, we should meet again and review in the months to come, whereas Saudi are much more like we should be, you know, verbally almost committing to the cuts in order to keep this market direction playing out in crude oil. Obviously in crude, from a bigger picture, I'll leave the intraday view to Sam, but this was the chart we were looking at yesterday in oil, and we've kind of consolidated on the run now to $59 handle. There's quite a big area of resistance coming up, that being that 50% fib of the multi-year high to the 2018 low that was seen in December. That comes in, I think, about 5965, and then you've got the 60 handle, which would also be some of the support from the early 2018 price action. So it's quite a big area coming up. What seems to be happening as well here, and it's worked out quite well with the previous price points in history is that the market tends to kind of run up to these handle, these, these round figures, and then see a bit of an area of consolidation, breaks, does the same again. And now we've hit that kind of 59 point. I just wonder whether or not we'll get up to 60. If 60— and then we were talking about this in the live room yesterday— if 60 breaks, I think 60 quickly becomes the kind of 60 62 area, this 6181, which would be some of these other technical points of relevance back in April of '18. The bigger presiding level above there would be around the 6360. This brings in the low point of the summer of, of last year and also the kind of the retracement then higher up of that entire move that we saw of that 45% correction at the end of last year. Other headlines, uh, just to wrap things up, this isn't particularly new but just kind of solidifies the stance at the moment for the Aussie currency. We had the RBA minutes overnight. Australia's central bank continuing to hold fire on interest rates even as the slide in the nation's home prices continues, and this has been seeping through into now weighing on consumer confidence. And so yeah, a lot of people— obviously we've talked about this in recent weeks— are becoming ever increasingly more dovish in regards to potential rate cuts to come, even though the RBA are communicating a relative neutral stance for the moment. But it's these kind of factors, particularly pertaining to the housing market, and as a consequence weighing on consumer sentiment. The other big external factor, of course, being the risks associated with the trade talks between the US and China, which would be incredibly pivotal as well for the economic prosperity for Australia, would be kind of key considerations there. Um, Credit Suisse we've looked at, uh, and so let's just jump on the calendar. And what have we got to come this morning? Well, we do have a couple of UK data points actually. Uh, this week we get the wage data today, um, you get the CPI data tomorrow, um, so then followed by the Bank of England on Thursday. So it's not all just Brexit, but one thing I would say is that with all these data points in the UK, unless they are substantially outlying, and even so then, uh, if you were going to trade around those events, then you'd be looking at pretty fast execution. You'll probably get a little fast money move, the speculators come in, but they'll be wanting to get out of the market pretty prompt i.e., is to not get caught on the wrong side of the noise of a Brexit headline coming out, a tweet, a rumor, and so on. Obviously, the political situations tend to be highly, you know, fluid, and so we could see developments materialize over the coming days. So you've got the UK wage data coming out at 9:30. You've got ZEW from Germany, again an interesting figure, but I wouldn't to say is going to be particularly meaningful, to be, to be quite honest at this point. Then going into the afternoon, durable goods is revisions. So really factory orders is your headline US number for the afternoon. You've got the oil inventories on until later on. And from a speaker's point of view, it is pretty quiet today. ECB's Prächt is speaking in a panel discussion a bit later on, but again, not expecting a great deal either. So overall, to give you a summary, it's a pretty neutral open, relatively quiet. We had generally a positive development overnight in terms of the close on Wall Street seeping through into the overnight Asia-Pacific session. So hence European stock futures basically flat to minor positive, oil's flat, gold relatively flat as well. The major news The news development has been on Brexit, the House Speaker then rejecting the ability of the government to bring forward the meaningful vote which was penciled in for today. So you can pretty much remove that now in regard to Brexit updates, are probably now more likely to come at the tail end of the week when we get the European Council meeting, which May will need to make something happen in order to bring a deal back for voting, which I do think will be the case at the beginning of next week. So yeah, that's it from me. Let me hand you over to Sam, and then he can talk over some of the other stuff in more detail. I'll be in the chat room, so just let me know if you have any questions throughout the day.

Hi guys, hope everyone is doing well and had a good evening. Yeah, just to follow on, we'll start having a quick look over that data. So 9:30 the UK. So I mean, looking at the, the pound chart today, and had a couple of questions about this, this yesterday, about the importance of the, these numbers coming out. And I mean, it's, it's going to be about the bigger picture and Brexit that's really going to drive things. Yes, there might be a bit of sort of short-term movement from these numbers, but I mean, that range that we're, we're sort of, you can see drawn up here, 3288 on the futures to 60. I wouldn't be too surprised to see it, you know, contained from that even if we were to have an outlier. Um, but probably worth having a look at this sort of post-data on the idea that we may get a break either way favoring the upside. I think we know with this resistance point and the R1, if that was to go, I think you get a decent push breaker above that and then suddenly you're looking looking at the high of the 14th and then the high of last week as the, the obvious sort of resistance points to, to keep an eye on. Um, yeah, I mean, you saw the, the Berko comments that pushed price down, only to be a decent opportunity to buy, much like it was on the, uh, the Tuesday— yeah, the Tuesday last week. I remember myself and Anthony were talking here, and, and since then it has just drifted to the upside and and really now in this range I'd be focusing on it going, uh, going higher. As I mentioned, the RBA, um, not providing too much in the way of an opportunity. Uh, quite an interesting level though, uh, yesterday's high. Um, you can see if I was just to draw that resistance point on, was also the high going back to the, uh, the, well, the higher the month, but the first, um, as well. So that was a key level there. So that's definitely one to, to keep an eye on if that was to push on. Bit of dollar weakness might have to, to come in for that to happen. And with the Fed tomorrow, be a bit shocked to see too much movement here, but that could be one for the bulls to, to keep an eye on. As we sort of drift, you can see we're now quite range-bound, um, worth having a bit of a trend line on from, from these lows. You can see we almost got a test of that this morning, so 7100, uh, handle, just a bit below. Break of that, I think yesterday's lows will come quite quickly. Probably worth getting one on from the, from the top as well. If it doesn't really break higher or lower from there, I'd recommend leaving this, uh, really as the confusion from the, the meetings, uh, the minutes, sorry, not really offering too much. But very key, uh, resistance point from yesterday, uh, to keep an eye on, um there. Other currency pairs have sort of reached an interesting point. Euro, if we have that trend channel one that we talked about for the last few days, has, has acted or almost come into to sort of be tested. If I just draw this on quickly here, you can see going back from the, the 10th of January, almost getting that test. Destroy it roughly on those lows as well. You can see how well it's been respected both to the upside and the downside. So quite a key level, uh, the resistance point we talked about in the briefing, just a bit above it as well from those lows on the, on the back end of February. So yeah, Fed, you know, coming out, uh, tomorrow might be the, the opportunity the bulls are waiting for if they're ultra dovish, more so than expected, for it to get long. But can the euro really push that much higher? Not too sure. I think as a resistance point it should hold pretty well, uh, to be honest. Having a quick look at the S&P while we're on one of the longer charts, and you can see having broken through the resistance point from October, I, I still think, you know, we get a quicker move. And the kind of the resemblance of yesterday's move was that, you know, it wouldn't be too surprising to, to get 2865 this week, those lows from September and then the 8th of October before that breakdown. I don't really see too much in the way way of stopping this. Even yesterday when we started to come back down, we had the downgrade of Facebook by Needham Co., potentially the reason why stock started coming back down around sort of 3, quarter past 3. The Nasdaq obviously really leading that. We have a quick look over at the Nasdaq, you can see around here, but yeah, it's still pushed on, still recovered in the back end of the session, which it has been doing for quite some time. And, and literally as we're speaking now, coming back to, to test those levels. Opportunity for a short, I think it's only going to be intraday here and there. I'm not too sure that too much is, is really going to stop this, this market. But for, for any opportunity to the downside, obviously, you know, key resistance point where people may take profit for a shorter push lower, or the odd headline here and there. Apple yesterday finished up, Boeing down, but even with Facebook and Boeing still down for the day, not really hurting stocks. And obviously we have continued to push on. Oil, yeah, that 50% fib, something to keep an eye on. But again, this morning, like yesterday morning, we have started to push on. And that high from yesterday is an obvious one to, to have marked up, but we're just testing now the high from from yesterday evening. Just having a quick look back at that calendar. So this will be the last week where we have the, the 8:30 API, with the clocks changing I think in the UK this, this weekend. So that's something to keep an eye on for crude traders. In a bit of a range, just going back though, you can see those lows from today, yesterday evening. So between sort of $59.20, which was the high going back to 15th as well that you see. So in a bit of a range, and again, like S&P, uh, favoring the upside break of that. Just to have a quick look over at gold to finish before a quick overview, uh, yesterday we saw a push all morning for it to then find resistance. We had a bit of a, uh, a bit of a false break of yesterday's high, getting people stopped out, and then came back to retest it as a, uh, then resistance point before drifting lower, but, uh, it has broken that this morning before, albeit drifting back down. And probably for, for this market, uh, with the Fed and, and the way this has moved off the dollar recently, probably worth, uh, you know, being a bit cautious ahead of Wednesday for that. However, decent trend line, albeit a tiny break there yesterday morning, to have one. We're not far from testing that, the, the height of overnight. You can see a really good level of support now turn resistance and support again, just being tested as we speak with that trendline as well. One to focus on for a sort of line in the sand for the bulls and the bears. Euro pound, I still favor the downside. However, a decent day yesterday for, uh, the euro in terms of it against the pound. But as long as we stay below those key levels, I would, uh, would favor this market to, to continue drifting lower really. Some important headlines obviously and meetings coming out this week. European equities, just gonna have a quick look at the DAX testing the pivot, sort of dragging the US ones higher. Oil favoring the break of the range to the upside along with S&P. Aussie dollar, I mean, if you're short from from yesterday. I think that's quite safe for now. Uh, and Euro with that trend channel was of course something to focus on as well. I hope you all have a good day ahead of you, um, and we'll catch you in the chat with any questions that you might have.