Disputes over trade tariffs and increasingly active central banks are increasing the volatility on financial markets and key moves are being seen again across forex, equities and commodities. After the ECB and the Federal Reserve impacted last week, attention turns to the Bank of England this week. We consider the outlook for markets.

1. Weekly Outlook
Monday 18th June 2018 by Richard Perry, Market Analyst
Forex and CFDs are high risk leveraged products that can result in losses greater than your initial deposit and you should
therefore only speculate with money you can afford to lose. FX and CFD trading are not suitable for everyone. Please
ensure you fully understand the risks involved, seeking independent advice if necessary prior to entering into such
transactions. You should first carefully consider your investment objectives, level of experience, and risk appetite and only
invest funds you are prepared to lose entirely. For our full risk warning, please go to the end of this report.
Key Economic Events
WHEN: Thursday 21th June, 1200BST
LAST: no change +0.50%
FORECAST: No change +0.50%
Impact: Last week’s raft of central bank decisions
drove volatility higher across major markets last week.
Will the Bank of England decision cause further
shockwaves? This time it is unlikely, but will the MPC
start to position for a potential rate hike at the August
meeting? Since failing to hike in May due to Q1 data
disappointments, there has been an improvement (esp.
retail sales) that could start to sway members. Explicit
signs are unlikely but look at voting intentions and a
suggestion the August meeting is “live”. Sterling and
Gilts will react but therefore also FTSE 100 too.
Date Time Country Indicator Consensus Last
Tue 19th Jun 1330BST US Building Permits / Housing Starts 1.35m / 1.32m 1.35m / 1.29m
Wed 20th Jun 1430BST G3 Central Bank forum (Sintra – Fed, ECB, BoJ)
Wed 20th Jun 1500BST US Existing Home Sales 5.52m 5.46m
Thu 21st Jun 0830BST Switzerland SNB monetary policy No change -0.75% No change -0.75%
Thu 21st Jun 1200BST UK Bank of England monetary policy No change +0.50% No change +0.50%
Thu 21st Jun 1330BST US Philly Fed Business Index +28.8 +34.4
Thu 21st Jun 2115BST UK BoE Governor Carney speaks
Fri 22nd Jun 0900BST Eurozone Flash PMI (Manufacturing/ Services / Comp) 55.1 / 53.6 / 53.9 55.5 / 53.9 / 54.1
Fri 22nd Jun 1445BST US Flash PMI (Manufacturing/ Services) 56.5 / 56.5 56.6 / 55.7
Fri 22nd Jun ALL OPEC Biannual meeting
T: +44 (0) 20 7036 0850 │ E: info@hantecfx.com │ W: hantecfx.com
1
N.B. After daylight savings time shift, please note all times are British Summer Time (BST) i.e. GMT +1. Data: Reuters
Macro Commentary
Central banks came back to the fore last week to remind us that for all the geopolitical risk factors (Trump’s various
trade disputes, Italian politics, Iranian nuclear sanctions and of course North Korea), monetary policy remain crucial
for markets. The G3 central banks (the Fed, ECB and BoJ) all announced last week and signaled something of
note. The Federal Reserve seemed to try its hardest to sound hawkish in its rate hike, but the market remains
decidedly uncertain. Maybe it was the shifting of just one dot on the plots that although officially signals four hikes
this year, but leaves such a move still massively in the balance. However, the yield curve continues to flatten with
the 10 year Treasury yield struggling for traction, and this is not great for expectations of future growth and could
begin to weigh on the dollar. With the US trade disputes ramping up and twin deficit still a drag on the economy, the
outlook is not especially bullish for the medium to longer term. Near term relative dollar performance has been
helped by the ECB’s dovish taper which has pulled the euro 200 pips lower. However, although the ECB
strengthened forward guidance adding emphasis to inflation data, the Eurozone recovery is still developing and
once the dust settles, the market should remain medium/long term euro supportive. The Bank of Japan cut its
inflation outlook to retain a dovish stance on monetary policy which means yen underperformance however as we
see again today geopolitical flare ups are still a caveat to this creating opportunities.
Must Watch for: Bank of England monetary policy
UK 10 year Gilt yield
The 10 year yield will pull higher if there are hints of a ptential
August rate hike

2. Weekly Outlook
Monday 18th June 2018 by Richard Perry, Market Analyst
Foreign Exchange
Traders were left unconvinced of the move by the Fed last week, needing a dovish taper from the ECB to
ultimately drive the greenback higher. But is this move sustainable? Dollar Index peaked just shy of the
October key lower high at 95.15, to pullback on Friday as the euro rebounded. Euro moves are therefore key as
it accounts for over half of the Dollar Index. If this rebound is seen as just a technical rally of the huge sell-off,
then we could see further gains on Dollar Index to push above the October high. However, an escalation
towards a trade war with China should still be dollar negative, whilst an ever flattening US yield curve is coming
as the longer end continues to struggle for traction. Longer term euro fundamentals remain positive and once
the dust properly settles on the ECB decision, this euro correction is likely to be a buying opportunity. There are
more central banks set to announce policy this week, with the Bank of England and the Swiss National Bank on
the agenda. Since the Bank of England baulked at a hike in May, traders have been watching for positive UK
data surprises to suggest that Q2 is picking up in a way that could encourage the MPC to hike at some stage
this year. This week’s decision will not contain a hike but given the improvement in Services PMI and also
Retail Sales for May, the sterling bulls will look for a nod towards August as a possibility. Sterling has been
improving with the data and if this is reflected in the minutes then a recovery could build again.
WATCH FOR: Sintra with Kuroda, Draghi and Powell all speaking. The BoE for GBP and SNB for CHF
T: +44 (0) 20 7036 0850 │ E: info@hantecfx.com │ W: hantecfx.com
2
FX Outlook
GBP/USD
Watch for: A break below $1.3200 opens a
retreat to $1.3025.
Outlook: Turning back lower and leaving a basis
of resistance at $1.3450 has really increased the
downside pressure into this week. The concern
is that a closing breach of support around
$1.3200 would open the next key reaction low
from November at $1.3025. The big top pattern
completed below $1.3710 implied 650 pips back
towards $1.3050 so this is well within the
technical scope of an implied move. Momentum
indicators have swung decisively negative once
more and the bulls will need to battle hard to
prevent another decisive break lower.
EUR/USD
Watch for: The support at $1.1500 is crucial
Outlook: The huge drop in the wake of the ECB
decision has had a profound impact on the euro
outlook. If the bulls do not begin to regather
themselves soon, this could now be the week
where the outlook turns increasingly negative
again. The early move lower on Monday will not
help the prospects of a rebound but the support
around $1.1500 is key now. The concern is that
a closing break below $1.1500 would now
complete a huge head and shoulders top that
would imply a further 10 big figure correction!
The momentum indicators turning lower shows
that the bulls are under pressure this week.
Resistance is between $1.1615/$1.1715.

3. Weekly Outlook
Monday 18th June 2018 by Richard Perry, Market Analyst
Equity Markets
Equity markets continue to be pulled around by currency action and the trade tariff concerns. The ECB dovish
taper hinted at a “lower for longer” position and the euro got smashed which has helped to support the major
Eurozone markets such as the DAX and CAC. However can these markets continue to make gains off this? Until
the ECB decision, there has been a decidedly uncertain look to DAX and CAC, stuttering especially on concerns
over the global growth implications of the trade disputes around the world. Thursday’s spike higher has already
looked to take a shift backwards once more and if the euro can begin to claw back some lost ground then
Eurozone equities are likely to see their gains pared further in the coming days this week. For the UK there is a
similar look to moves on sterling, as the sharp sterling losses last Thursday were accompanied by FTSE 100
gains (over 70% of FTSE 100 revenues are foreign currency based). Already, there are signs that the market
has not trusted this move higher and a retracement is setting in. The support at 7600 remains key for FTSE
100.The concern for Wall Street is that whilst market such as the S&P 500 and Dow broke to their highest levels
since March a couple of weeks ago, the move is beginning to fade. On a technical basis, this looks to be a near
term corrective move into the medium term breakout at 2742 on S&P 500 and around 25,000 on the Dow.
However, there is a sizeable caveat to the medium term bullish outlook on Wall Street as the Bloomberg Smart
Money Flow Index is dropping sharply as the “smart money” seems to be flooding out of the S&P 500. This could
be the prelude to a difficult summer for US equities.
WATCH FOR: Currency moves remain key, so watch for Draghi at Sintra, but also the BoE for FTSE100.
T: +44 (0) 20 7036 0850 │ E: info@hantecfx.com │ W: hantecfx.com
3
DAX Xetra
Watch for: The need to build support above
12,925 pivot to prevent an ongoing range
Outlook: Thursday’s strong bullish session is
already unwinding. The market failed to breakout
above the key May high at 13,204 and although
momentum indicators have been pulled strongly
higher, there is a sense that this could be a
move to quickly retrace if the bulls cannot begin
to build support again early this week. The pivot
around 12,925 could become a key level to
watch in the coming days. That would mean that
the market is actually forming a range between
the old breakout around 12,600 and under
13,200.
FTSE 100
Watch for: A failed upside break puts the
pressure back on 7600 once more
Outlook: The bulls come into this week with a
sour taste as hard fought gains seen on
Thursday have been entirely undone again. This
failure at 7793 and subsequent sharp turn lower
puts the support of the old key breakout around
7600 once more in the spotlight this week.
Although there is no explicit bearish outlook on
the momentum, the market is still corrective near
term as the RSI breaks to multi week lows and a
closing break below 7600 would be a concerning
development and open a further correction.
Support at 7492 is immediately present, but a
retreat to the long term pivot around 7300 could
easily be seen.
Index Outlook

4. Weekly Outlook
Monday 18th June 2018 by Richard Perry, Market Analyst
Other Assets: Commodities & Bonds
Gold has fallen sharply back from the long term pivot at $1300/$1310 once more, with gold eventually being hit
by the broad strengthening of the dollar that has re-engaged following the ECB move. The ECB still seems to
be cautious on inflation and this is a dampener for gold.
The bi-annual OPEC meeting is key for oil this week. Firstly, how the decline in supply due to issues in
Venezuela are dealt with? Also with the oil market close to balance, is there a need for ongoing production
restraint? Suggestions are that Saudi Arabia are looking to raise OPEC production by c. 500,000 barrels, whilst
agreement with Russia is also important. All the while though, rising US production is dampening WTI prices. If
OPEC begins to ease up on the production limits then this historically wide Brent/WTI spread could narrow.
Global yields took a hit towards the end of last week as first the market took a dim view of the Fed’s rate hike
and then the ECB dovish taper. The US 10 year yield fell10 basis points in whilst yields on the Bund and Gilts
also fell sharply. There will be implications across asset classes if these moves continue. Bond markets seem
to have moved to buy back into bonds and this is likely to remain the risk as Trump continues to ramp up trade
tensions. All the while the US yield curve flattening is accelerating.
WATCH FOR: China’s reaction to the US trade tariffs, with US subsequent response to that. The Fed’s
Powell speaking at Sintra could also factor for Treasuries
T: +44 (0) 20 7036 0850 │ E: info@hantecfx.com │ W: hantecfx.com
4
Gold
Watch for: Another failure in $1300/$1310 and
broken long term uptrend means a correction to
$1236 is ever more possible.
Outlook: The longer term pivot band between
$1300/$1310 has struck the market once more
as the near term drift higher once more seems to
have found resistance in this pivot range. Falling
back, the bears will note that the medium term
outlook has been corrective since the decisive
break below $1300 in May. The market has been
flirting with an 18 month uptrend recently, but
this has also now been decisively broken. The
implication of the breakdown remains a
correction towards the key December low at
$1236 and with renewed selling pressure on
Friday, this becomes an increasing possibility
now as rallies remain a chance to sell.
Markets Outlook
Brent Crude oil
Watch for: A near term correction is gathering
pace as support between $71/$72 is eyed
Outlook: The market has now been building
lower highs over the past month as the near
term correction continues to come back towards
the longer term uptrend which comes in this
week around $71. The next support is around
$72.40 and a corrective configuration on the
momentum indicators suggests that the sellers
are in control as we move towards the OPEC
meeting on Friday. For the time being, this is a
correction within the medium to longer term bull
market, however the concerns around the OPEC
meeting will grow as the price falls back.

5. Weekly Outlook
Monday 18th June 2018 by Richard Perry, Market Analyst
T: +44 (0) 20 7036 0850 │ E: info@hantecfx.com │ W: hantecfx.com
5
Risk Warning for Financial Promotions
This report is issued by Hantec Markets Limited, who is authorised and regulated by the Financial Conduct Authority
(FCA) in the UK, No. 502635. The report is prepared and distributed for information purposes only.
Trading in Foreign Exchange (FX), Bullion and Contracts for Differences (CFDs) is not be suitable for all investors due to
the high risk nature of these products. Forex, Bullion and CFDs are leveraged products that can result in losses greater
than your initial deposit. The value of an FX, Bullion or CFD position may be affected by a variety of factors, including but
not limited to, price volatility, market volume, foreign exchange rates and liquidity. You may lose your entire initial stake
and you may be required to make additional payments. Please ensure you fully understand the risks involved, seeking
independent advice if necessary prior to entering into such transactions. Before deciding to enter into FX, Bullion and/or
CFD trading, you should carefully consider your investment objectives, level of experience, and risk appetite. You should
only invest in FX, Bullion and/or CFD trading with funds you are prepared to lose entirely. Therefore, only your excess
funds should be placed at risk and anyone who does not have such excess funds should completely refrain from engaging
in FX and/or CFD trading. Do not rely on past performance figures. If you are in any doubt, please seek further
independent advice.
This report does not constitute personal investment advice, nor does it take into account the individual financial
circumstances or objectives of the clients who receive it. All information and research produced by Hantec Markets is
intended to be general in nature; it does not constitute a recommendation or offer for the purchase or sale of any
financial instrument, nor should it be construed as such. All of the views or suggestions within this report are those solely
and exclusively of the author, and accurately reflect his personal views about any and all of the subject instruments and
are presented to the best of the author’s knowledge. Any person relying on this report to undertake trading does so
entirely at his/her own risk and Hantec Markets does not accept any liability.
Trust Through Transparency
Hantec House, 12-14 Wilfred Street, London SW1E 6PL
T: +44 (0) 20 7036 0850
F: +44 (0) 20 7036 0899
E: info@hantecfx.com
W: hantecfx.com