 Hello traders at CMC Markets. Welcome to a new update by RRG Research for Monday the 25th of July and I'm recording this on Thursday the 20th of July after the close of the US markets. My name is Julius de Campanar and I am presenting to you from Amsterdam in the Netherlands. Let's kick off with a quick look at the RRG that shows the rotation for various stock markets around the world. That image is shifting slightly. We have seen a period where a group of markets was leading and a group of markets was lagging and the leading groups was Nifty, S&P, the Nikkei, the Nasdaq, New York Fang, they've been driving these markets higher and you can see that they're now starting to lose a bit of relative momentum. Nothing super bad. They're still in the leading quadrant, they're still in relative uptrends, but the pace is slowing down. And on the other side we have a group of predominantly European markets, so the FTSE, the EuroStock600, the DAX, the KAC, that are continuing to push further into the lagging quadrant meaning a relative downtrend versus the MSCI world. You see a bit of improvement in Hong Kong although that is still at the lowest reading of the RRG and you can see the Dow Jones which is a sort of a lone ranger here on the left-hand side. If we take that to the daily RRG, then you can see that there is some short-term weakness coming in. You can see that the markets that were leading like the S&P, New York Fang, Nasdaq, Nifty, they're still on the right-hand side but you can see the tails pointing to that southwestern corner, that lagging quadrant that indicates at least a temporary period of relative weakness. And that seems to be getting picked up on the European side where you have the FTSE picking up, you see the DAX, you see the European markets, you see the KAC hooking back up. So with that longer-term trend still intact, it looks as if we're getting some opportunities with a preference for European markets over US markets which is against the major trend. That's probably the most important thing to remember. If we look at the daily RRG against 0%, then it becomes a price trend analysis tool and you can see how these leading markets are still on the right-hand side, they're still pushing further into the leading quadrant and the opposite goes for the European markets. What you can see is that they're picking up but they still need to pick up the slack that they had against the US markets, S&P, Nasdaq and the Nifty. If we look at some of the individual charts here, let's start with the S&P 500 and you can see how that resistance zone between 4500 and 4600 is now being tested. That is derived from a couple of highs that were set back in February 2022 and then again in March 2022 and we're now getting into that resistance area and we seem to be forming a small peak there. As I said, maybe some short-term weakness is to be expected but when you look at this chart, it's very well possible for the S&P to drop back to 4450 without harming that uptrend and even if it goes down all the way to 4330, 4350 that doesn't change that long-term picture where the S&P is coming out of that big base. Look at this massive move here. If you would drop back to this previous high which is expected to act as support right here or maybe even to this one here as long as it is like a nice move and to be picked up then the rhythm of higher highs and higher lows remains intact and so does the uptrend. So long-term trend still good, short-term maybe some weakness ahead of us. Same goes for the NASDAQ. You can see how it's still inside that rising trend channel and you can see how there is support to be detected around 15 to 25 and the rising trend line is slightly higher but here also you can see that as a pretty steep rally and even if we get out of this channel and below this previous resistance now support as long as we remain above 1300, I don't think there's anything wrong with the chart of the NASDAQ and we will eventually put in a higher low and move further upward. It could be a little bit of a decline here but the longer-term trend is still good. If we look at the European markets, you can see that you can eyeball from this chart that the stock 600 is in better shape. You can see it's coming down less. It rallied less fast, that's for sure. That's why the US was leading and Europe was lagging but you can see that it's now turned around at least for the short-term. You can see how the European markets picked up a little bit and they're pushing towards that resistance zone just shy of 470 in the stock 600. If you look at the DAX, that's even better. It's pushing against that resistance area around 16200, 16300 and that's the all-time high for the DAX. If that gets taken out, there'll be a really strong sign. With the current weakness overall for stock markets, short-term weakness that's probably a bridge too far but as long as we remain above that 1500-600 level I think the DAX is still in good shape and that's the whole beauty of relative strength even if the DAX declines as long as it's declining less fast than the S&P or the NASDAQ you can still profit from a pair trade long-DAX, short S&P, short NASDAQ. It's all about the relative move. It doesn't necessarily mean that the long lag of a pair trade needs to get higher as long as it's dropping less fast than the short side, then you're fine. If you look at the FTSE, that's a market that seems to be getting back to life. Pretty much all of this year the FTSE was characterized by a downtrend even eyeballing the FTSE versus the DAX. Which one is the better one? It's not a very difficult decision, right? But we see that the FTSE has now come out of that downtrend it took out that falling resistance line it took out the previous high so it looks as if we're getting into a rhythm of higher highs and higher lows for the first time since a very long time making the UK market an interesting place to look for potential long positions. If we move to the New York FANG index we look at that pretty much every week in this show you can see how that peaked against the 8000 resistance area it's all-time high and we're dropping back below that all-time high so that previous all-time high that break was not able to catch that decline from the breakout. We're now resting at a slimmer of support here to be honest I'm not giving this too much weight I think that this index needs a little bit more of a correction and I'm watching the area around 7000 for that but again just like with the NASDAQ and the S&P if you look at this chart and in two, three months time we look at it and we say oh it went down to 7000 and then we bounce back up, very nice old resistance became support, not a problem it's obviously when you're caught on the wrong side it can still be a painful experience but if you take a step back and you look at it from a longer-term perspective it's not necessarily a bad thing we can see some sort of a decline here and it gives us new opportunities to get back in at lower levels if we take a quick look at the RRG for the New York Fang components so this is the weekly RRG for the New York Fang Universe and you can see that NVIDIA remains still very strong Tesla remains strong it's just losing a bit of relative momentum when it's entering that leading quadrant Meta seems to be kind of pushing back up losing a bit of momentum but it's still there AMD, Insight weakening, very short tail which means that it's a very stable trend and you can see relative downtrends for Google, Apple, Microsoft Snowflake, some improvement for Netflix if we take that to the shorter term, the daily then you can see a bit of a different image we can see NVIDIA and Meta still doing well Meta losing a bit but NVIDIA still doing well we can see Microsoft hooking back up and starting to move towards the leading quadrant we see Amazon hooking back up Apple hooking back up look at a few of these individual charts let's start with Meta here on the right-hand side and look at this chart here in November it was below 100 USD it's now trading over 300 USD that's a three-fold increase in about 7 months that is strong so if we get a little bit of a decline it's not a problem and you can see how that is still it's forming a very small double top pattern here and that has just executed which means that we can see a little bit more downside in the next couple of days where could it go? if we stay within the boundaries of this trend channel we're looking for 290 as a support level that's the previous highs here old resistance becoming support and it coincides with the rising trend line if it moves a little bit lower again then we will see a little bit more downside but with this move it's not a super big problem it's still a pretty healthy chart if you look at NVIDIA it's saying this is actually quite interesting chart because it looks as if this is just sort of disconnected this is a completely new a reset with a new chart and all of a sudden we see how this is starting to build a new rising channel we just tested the upside of that channel and even within the boundaries of that rising channel you can see some sort of a decline going back down to maybe the 430 area if it breaks then you can see the top of the gap area here around 365 which should be a good support area and ultimately we could even go down to 330 that is a massive decline I realize that but just to to make clear an attempt to make clear the magnitude that we're talking about here if you look at this move here and you can see how that declines I hope you agree with me how massive the support around 330 is of that old high here and then there is plenty levels where we can see support coming in for NVIDIA so in the near term maybe a little bit of a correction but the longer term is actually pretty good and it's on a relative basis definitely outperforming the New York Fang Index if we look at the so Microsoft was still here that's the same story you can see how Microsoft actually seems to be holding up the break above its all time high levels that are dating back to 2021 that's the area around like 345-350 we're right in the middle right now so if we see some form of a new low being put into place in this area maybe against the upper the lower boundary of that rising channel that could be a new entry opportunity for Microsoft potentially as the long side of a pear trade and what we'll be looking for on the opposite side on the short side is the stuff that's moving towards that lagging quadrant so that's Tesla and Netflix again, the longer term charts are still pretty strong but in the near term, especially on a relative basis both Netflix and Tesla could be interesting to see some weakness you can see how this is actually a weaker you see a pretty sharp decline here with a big gap coming back down from this previous high here dropping below it so no way that that acted as support but it was declined and that opens up the way for more downside what I'm looking at for Netflix here is around 410 we're currently 437 so that's another 20-25 bucks that we could actually see the market going lower it could even go to 378-375 then it will hit that shallow rising trend line as you can see the uptrend fully intact it's just going into some sort of a temporary decline for Netflix and the same goes for Tesla if you look at Tesla that bottom is in place you can see how it kind of reversed that massive decline that we saw coming from over 400 back down to 100 and we didn't reach that over at resistance level and from the weaker stocks in this New York Fang universe I think that Tesla has the best opportunities to the downside because it's got a very clear pattern we call this a rising wedge and it's a rising wedge at the end of an uptrend that's usually pretty negative it's a turnaround signal and you can bag a price target to be at the start the beginning of the formation that means that we could see Tesla going back to below 240 US dollars in the next couple of days that should give you enough food for thought to see how you can play the moves inside that New York Fang universe and let's wrap it up with a quick look at what's happening in the currency markets the RRG here shows you the rotation for the G10 currencies against the US dollar and what you can see here is actually across the board US dollar weakness all these tails are moving towards the top right hand quadrant and that means that all these currencies so Nokia, Sweden, Switzerland this is gold, yen they're all picking up against the US dollar last few days it's a little bit less but the generic picture you can see is pointing into that north eastern direction which is in this case general dollar weakness strength for the other currencies if we look at the individual charts then we look at Euro dollar and as you remember that 110, 111 was a pretty important also longer term resistance level it acted as support resistance and now we took it out to the upside and I think that was a that was a pretty major break at least for me what it meant is shifting my thought process and my market approach to one of general dollar strength so this coming down is dollar strength this is dollar strength, Euro weakness and now we have kind of moved around and the approach should now be looking for general dollar weakness and in this case strength for the Euro and if you look at the dollar yen chart that's even more pronounced you can see how that turned around and that move already started here back in May where you saw that the dollar started to take over from the yen we rallied towards the old here support now resistance area didn't quite reach it but here you can see how that old resistance level the area around 137 acted as resistance well cluster of highs here one more here, one more here then we broke it and now it acted as support and this is what I mean looking for support, looking for a bottom formation to get into place against the old resistance now support area that's exactly what happening here in dollar yen and it looks as if this crosses now back on the way up I wouldn't be surprised if this goes back up to 144, 145 underscoring the current strength of the US dollar finally wrapping it up with gold we actually spoke about that 1940 level that was taken out to the downside it didn't really materialize it acted a little bit as resistance and then we broke through so we're now negating that downward break and moving to the upside we're looking for resistance around 1990 and then back up to the 2000 area and that could be a very important move first if we take out 1990 there's definitely possibility for a move back up to 2000 but when we make this chart longer you can see how important that 2000 area is, 2070 area that's a massive overhead resistance if we get there if gold takes that out it's an all new area for gold will be on the lookout for that to happen but let's first see if we can get that move going for 1990 towards the 2040, 2050, 2070 area of all these previous highs that wraps up the show for this week I hope you enjoyed watching it I'm looking forward to seeing you again next week at a new episode by RRG Research same time, same place