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M&S and Ocado is a match made in heaven, both companies can benefit from this joint venture. The fact that Ocado is allowed to carry its own brand along with M&S products, this gives customers larger selection of products at their disposal. Ocado was in a tight spot because it needed funds to enhance the developments of its customer solution and the upfront payment of £562 million is going to help it to fully fund this development.

For M&S, this is their first opportunity to deliver their food at the doorsteps of their customers, something which they have not done before and it was badly needed in this market. Buying 50 percent share in Ocado for M&S isn't that difficult for M&S and the company's strategy to finance this deal by using the rights issue of shares is an appropriate strategy. A dividend is obviously a place where investors will feel some pain because M&S will cut that by 40 percent. However, this will be compensated with the increase in revenue through an increase in revenue.

The partnership will also help M&S to look at its current chain of stores more strategically and evaluates their potential more accurately, this is because if you can deliver food on the doorstep, there may be no point of having more than one store within a certain mile of the radius.

M&S shares were in strong position yesterday with a 3.2% gain while the country's index declines. The most interesting element was the volume which was literally three times than the 20-day average and the one-month implied volatility also jumped 28 percent. The stock is trading at 12 times its estimated earning per share for 2019 and we think it is still a bargain with huge potential on the horizon.

The chart below shows that M&S stock price (in the upper panel of the chart) has broken its downward trend line, a positive sign. Also, the price is trading above the 50-day, 100-day and 200-day moving averages, all of this confirm the bull strength.

King Dollar was a step closer to losing its crown yesterday after Federal Reserve Chairman Powell reiterated the Fed's ‘patient' policy mantra during his Congressional testimony.

Although Powell delivered an encouraging assessment of the economy, he did acknowledge the multiple headwinds both domestically and externally. A string of disappointing economic reports from the United States have triggered concerns over growth prospects, while geopolitical risks and fears of plateauing global growth are compounding the uncertainty. With a ‘patient' and ‘flexible' Fed likely to leave interest rate unchanged for an extended period of time, the Dollar remains vulnerable to downside shocks.

The Greenback's negative reaction to Powell's testimony was quite interesting, given that his comments were old news with no fresh insight provided. I see this reaction as an early signal for increased Dollar sensitivity to remarks from Fed policy makers and economic data. All in all, it does feel like Dollar bulls are running on borrowed time and this continues to be reflected in the Dollar's price action.

Taking a look at the technical picture, the Dollar Index is under increasing pressure on the daily charts. A solid breakdown and daily close below the 96.00 support level is seen opening a path towards 95.70 and 95.50, respectively.

Stock markets search for fresh catalyst

Asian markets edged higher this morning as investors kept a close eye on the US-North Korean summit, scheduled to commence in Hanoi later today.

Global risk appetite is likely to receive a solid boost if talks between US President Donald Trump and North Korean leader Kim Jong Un end on a positive note. It must be kept in mind that stock markets still remain influenced by US-China trade developments, global growth concerns and other geopolitical risk factors. Any fresh news on the trade front or rising geopolitical risks will play a role in where global stocks close this week.

Currency spotlight – GBPUSD

The British Pound was an unexpected champion across currency markets yesterday as expectations mounted over a delay in Brexit.

A promise from UK Prime Minister Theresa May for a vote to delay Brexit if her deal is rejected came as a breath of fresh air for investors. While the Pound is likely to extend gains amid the current optimism, the question if for how long? It is quite frightening how sensitive and explosively volatile the Sterling has become to Brexit headlines, and this is likely to intensify as the March 29 deadline looms.

Focusing on the technical perspective, the GBPUSD is heavily bullish on the daily charts. The daily close above 1.3200 has opened the gates towards 1.3310 in the short to medium term.

Daily Pivots: (S1) 145.61; (P) 146.32; (R1) 147.24; More...

Intraday bias in GBP/JPY remains on the upside for the moment. Sustained trading above medium term trend line resistance will pave the way to 149.58 resistance next. On the downside, break of 143.78 support will indicate short term topping. In this case, intraday bias will be flipped to the downside for 141.00 support.

In the bigger picture, the strong rebound from 131.51 suggests that medium term fall from 156.59 (2018 high) has completed already. The corrective structure of such decline is turn argues that it's the second leg of the corrective pattern from 122.36 (2016 low). And this pattern is starting the third leg. On the upside, decisive break of 149.48 will pave the way to 156.59 resistance and above.

Daily Pivots: (S1) 125.70; (P) 125.97; (R1) 126.21; More....

Intraday bias in EUR/JPY remains neutral for the moment. On the downside, break of 124.23 support will suggest completion of rebound from 118.62 after rejection by 55 day EMA. Deeper fall would then be seen back to retest 118.62 low. However, decisive break of 126.30 will dampen our bearish view and target 129.25 resistance next.

In the bigger picture, medium term rebound from 109.03 (2016 low) has completed at 137.49 (2018 high) already, with corrective structure. Fall from 137.49 is likely still in progress. Decisive break of 118.62 will target 161.8% projection of 137.49 to 124.61 from 133.12 at 112.28, which is inside 109.03/114.84 support zone. This will remain the favored case as long as 129.25 resistance holds.

Daily Pivots: (S1) 0.8549; (P) 0.8611; (R1) 0.8659; More...

Intraday bias in EUR/GBP remains on the downside at this point. Current decline is targeting 61.8% projection of 0.9101 to 0.8617 from 0.8840 at 0.8541. Break there will target 0.8416 projection level next. On the upside, break of 0.8653 minor resistance will turn intraday bias neutral first. But recovery should be limited well below 0.8840 resistance to bring another decline.

In the bigger picture, EUR/GBP is seen as staying in long term range pattern started at 0.9304 (2016 high). On the downside, decisive break of 0.8620 support will resume the falling leg from 0.9305 (2017 high) to 100% projection of 0.9305 to 0.8620 from 0.9101 at 0.8416. In that case, we'd expect strong support around 0.8312 to contain downside and bring rebound.

Daily Pivots: (S1) 1.5811; (P) 1.5856; (R1) 1.5890; More....

EUR/AUD continues to gyrate in range above 1.5721 and intraday bias stays neutral Further rise remains mildly in favor. On the upside, decisive break of 1.6060 resistance should confirm that decline from 1.6765 has completed. Further rally should then be seen to retest 1.6765 high. On the downside, however, break of 1.5721 will extend the decline to 1.5346 support instead.

In the bigger picture, as long as 1.5346 support holds, outlook will remain bullish. Uptrend from 1.1602 (2012 low) is expected to resume sooner or later. Break of 1.6765 will target 61.8% retracement of 2.1127 (2008 high) to 1.1602 at 1.7488 next. However, firm break of 1.5346 key support will indicate trend reversal, with bearish divergence condition in weekly MACD, and turn outlook bearish.

Daily Pivots: (S1) 1.1360; (P) 1.1376; (R1) 1.1406; More...

EUR/CHF is still bounded in range of 1.1310/1444. Intraday bias remains neutral for the moment. As long as 1.1310 support holds, further rise is mildly in favor. On the upside, break of 1.1444 will resume the rebound from 1.1181 to 1.1501 key resistance next. Nevertheless, sustained break of 1.1310 will suggest that rebound from 1.1181 might be completed. Intraday bias will be turned back to the downside for 1.1181 low again.

In the bigger picture, price actions from 1.2004 medium term top is seen as a correction only. Downside should be contained by 1.1154/98 support zone to complete it and bring rebound. Decisive break of 1.1501 (38.2% retracement of 1.2004 to 1.1173 at 1.1490) will confirm completion of the correction, on bullish convergence condition in daily MACD. Further rise should be seen to 61.8% retracement at 1.1687 and above next.

Pivot (invalidation): 110.75

Our preference Short positions below 110.75 with targets at 110.40 & 110.25 in extension.

Alternative scenario Above 110.75 look for further upside with 110.90 & 111.05 as targets.

Comment The RSI calls for a new downleg.

Pivot (invalidation): 1.3190

Our preference Long positions above 1.3190 with targets at 1.3290 & 1.3330 in extension.

Alternative scenario Below 1.3190 look for further downside with 1.3140 & 1.3100 as targets.

Comment The RSI calls for a bounce.

Pivot (invalidation): 1.1365

Our preference Long positions above 1.1365 with targets at 1.1400 & 1.1415 in extension.

Alternative scenario Below 1.1365 look for further downside with 1.1345 & 1.1325 as targets.

Comment A support base at 1.1365 has formed and has allowed for a temporary stabilisation.