 Good afternoon ladies and gentlemen and welcome to this non-farm payrolls US payrolls report webinar on Friday the 8th of May and This overview of what is likely to be a very symbolic and historic US employment report before I get started though. I obviously have to make you aware of a number of disclaimers I'm going to be talking you through the numbers today, but what I cannot do is give you Direct trading advice. Well, I can obviously Indicate where the important support and resistance levels are what my expectations are for the numbers and the overall parameters of any move higher or lower in terms of the various asset classes that I'm going to be covering Today I think one of the things that has struck me about the data that we've hope that we've seen Over the course of the past few days in the past couple of weeks in fact is Despite the fact that the data has been by and large pretty awful equity markets of by and large been fairly immune to it and I Think there's a I think there's a number of factors behind that I think no one is under any illusions that the data that we're currently seeing is going to get an awful lot worse Yet despite that I think the overall expectation is that markets Are not focusing so much on the data, which we all know is going to be bad It's just really a matter of degree It's they're looking at the potential For the recovery so they're looking beyond the data. They're looking at The easing of the lockdowns. They're looking at the ability or the likelihood That the various economies UK economy the European economy the US economy Will rebound and for any number of reasons while that is certainly Factor behind the rebound that we're seeing in markets not to mention the huge amounts of liquidity That are being thrown at The financial system. I think one of the things That you can take away is that in the absence of anywhere else to put your money Stocks at the moment are pretty much The asset class of choice and that's why you're seeing markets Looking as strong as they are because if you put the money into the bond market You're not really going to get that much of a return in Europe. You're going to get a negative yield in the UK You're going to get 0.3 0.4 percent on 10-year paper Or even slightly above that And even in US treasuries, you're still going to get an interest rate that's below the level of inflation. So While you can argue that What we're seeing at the moment makes no sense and that Wall Street is diverging from Main Street and it is it absolutely is What we're seeing at the moment is a symptom of hope over expectation and That's why you're seeing markets move the way that it has I had an interesting conversation on Twitter this morning With someone who's basically saying to me that The move higher in equity markets doesn't make sense and Yeah, it's absolutely right But that just reminds me of something that John Maynard Keynes said that markets can remain irrational for longer than you can remain Southern and ultimately the only thing you can do as a trader or as an investor is to basically trade what you see so putting aside the Putting aside whether or not what you're seeing is rational or irrational You can't go against the herd if if a whole host of people are running in one direction It's very very difficult to push back against the crowd because you just get swept along with them Whether or not behaving rationally or not is neither here nor there What you as a trader has to do is to try and maintain a degree of skepticism maintain a degree of caution Go with the flow Until such times as there is evidence and this is very much an evidence-based approach that we're talking about here There is evidence that what we're seeing is starting to run out of steam The best and easiest way to do that is to look at the price action Because if we drill down into the numbers and I will be drilling down into the numbers looking at the S&P 500 chart here The fact of the matter is that Looking at this price action What we're seeing is in essence and a sideways consolidation After we put in those highs in April. So really it's a question of where do we go from here? So for those of you that some of you are saying that you can't hear the audio you need to check your speaker volumes Because as far as I'm concerned, I'm guessing that most of you can hear me loud and clear So I'm just going to quickly Speak your volumes and I'm going to send that to everybody Check speaker volumes. Sorry. You call me in full flow here if you cannot Yeah, not very good at multitasking and looking at my keyboards. So So there we go. So I've just done that Okay, so where are we? Super. All right. Where was I? Yeah. So basically You know This is something I get asked a lot You know, we're looking at the data and we're looking at the expectations and the expectations are dire You know, you're not going to get any argument from me about that And yet counter-injuitively you would think markets will go down on that and they have gone down from the highs We saw earlier this week, but markets are looking beyond that. They're looking beyond the end of this year They're looking towards next year. They're basically pricing in V-shaped recovery. Look at the Bank of England yesterday The Bank of England yesterday was forecasting a 14% decline in UK GDP For 2020 and a 15% rebound in 2021 Now, you know, these people are paid an awful lot of money to make economic predictions as to what the economy is likely to do The IMF the OECD All of these global bodies Now I can count on the fingers of two hands how often they are, right? It's not that many so For me, it's really about the price action All the rest of it is noise and you listen to you can read the tabloids You can read the FT you can read the telegraph But ultimately what's important is not just the macroeconomic environment that is important But it's also about what the price action is telling you and for me the price action really drives everything You can look at this from a fundamental point of view You can look at it from a technical point of view from a technical point of view at the moment the market is trending higher Irrespective of what the data is doing and the reason that is happening is because you've got orders liquidity in the market It has to go somewhere Now it either goes into gold or it goes into bonds or it goes into equities and at the moment it's going into equities Now you can argue until the cows come and how rational that is It's not going to change the direction of the market and it's not going to change the look and feel the economy What's happened is all this extra liquidity has turned has basically averted a medical crisis Turning into a financial crisis for the financial markets what it has not done and what it won't do is Stop a financial crisis for ordinary men and women people like you and me people the 30 million people the 40 million people That have been thrown out onto the streets of the US economy over the course of the past six to eight weeks we are going to go in this payrolls report from the lowest level of unemployment in 50 years for the US economy To the highest level of unemployment in 50 years It's wiped out the last 10 years of US jobs growth. These are Completely unique times and that means that it's very very difficult to try and draw any baseline comparisons All we can do is basically look at the price action and that's what I'm looking at here. So When we talk about the rebound in equity markets, I'm looking at the S&P 500 As the key driver of equity markets as well as the DEX. It's a global it's a global Ecosystem if you like so for me at the moment while we are trending higher We are still Below the 200 day moving average on all the major equity market indices And that for me is the line in the sand for me at the moment The upside is likely to remain limited while we're below the April highs and the 200 day moving average So if we move back above the levels that we're currently seeing now I'm not going to be buying the S&P 500 anywhere near these sorts of levels on a long-term basis I would only revise that opinion if we take out these highs here and the 200 day moving average This is a correction at the moment to my mind This is a correction to a down move and that's the basis of my overall premise When I'm looking at these markets now when the facts change or the data changes I Will revise that but at the moment I'm very much a case of with equity markets at these sorts of levels I'm selling any strength up to the previous highs and the 200 day moving average. So for me You know, it's it's very very simple. We have come down from the April highs We've rebounded on the four hour chart. We are starting to slowly move higher, which means That if we get a move back down to the trend line that I've drawn on this particular chart here We're likely to get a rebound From these sorts of levels, but at anywhere near here, I'm probably a small seller for a move back down to these sorts of levels here Simply because first and foremost, we've got a weekend coming up and I think it's highly unlikely The markets are going to want to be going long into this weekend But it is also the fact that All of this all of this peak optimism that we've got in at the moment is slightly overdone So this is a 61.8 Fibonacci retracement level the entire down move from the highs that we saw in February March to the lows and As such on This four hour chart we could well find a little bit of resistance anywhere near 29 30 29 40 So I'm not going to get overly balled up at the moment. The same applies to the German DAX So you need to make higher lows and higher highs What's the definition of an uptrend? It's higher lows and higher highs So you need to take out the previous highs at the moment. We're in a bit of a consolidation mode On the S&P and on the and on the German DAX as well We can see that clearly here from this chart that I've drawn here if I just zoom it out It's it's an awful lot clearer Here at the moment So I'm going to basically change this daily chart that we're currently looking at to four hours Zoom it in finding a little bit of resistance in and around these sorts of areas here over the last four hours So the highs that we saw this morning at 10,880 there or there about it's the 50% retracement It's also acted as a little bit of a peak there and you've got a bit of an island up here as well So looking a little bit over over ball on for our chart now, obviously, you know as with any trading decision You can be wrong as often as you are right, but it's a question of where do you put your stop loss? you know and for me if I was trading this from the short side on a On a particular day What I would do is I would put my stop loss above the previous high So in this case on this for our chart the high on this chart is 10,913 So I'd stick any short up stick my stop loss above that high around about 10,914 there are there abouts Look for a move to come back down here again But you can see from these these these progressively higher lows here that we are trending higher now You could argue that this could be if this higher remains intact and irregular head and shoulders forming here You've got two left shoulders here You've got a head here and you've got the potential for a right shoulder forming here But we don't know that yet The moment this this this pattern such as it is isn't actually playing out all we can do Is basically draw conclusions based on the available data at hand So at the moment I'm trying a little bit of a neckline here on the basis that this could well be a short term This could be a short-term peak for a move back lower irrespective of what the data is It's probably not going to affect it one way the other what we have been seeing is the worst the data has been The more equity markets tend to trend higher And I think one of the thing thinking behind that is the worst the data is the more fiscal stimulus Is likely to be injected into the system from governments and more central bank stimulus is like to be pumped in as well The Bank of England has more or less said They're going to be doing another hundred billion pounds of quantitative easing in June two members have already voted for it You're only going to need another three members to vote for it between now and then when the data gets even worse Which it will because we've got first quarter GDP coming out from Germany in the UK next week Which means the second quarter GDP is likely to be even worse So the perception will be more liquidity higher stocks but at some point the rubber will have to hit the road and The expectation will be at the moment is that this will be a short sharp shock I'm not convinced it will be because an awful lot of the jobs that have been lost And will be lost over the course of the next few weeks won't be coming back those jobs in travel retail Aerospace alongside scores of supply chain jobs will not be coming back and that will constrain Investment it will constrain consumer spending. So we will not get a v-shaped recovery No matter how optimistic you want to be with respect to the markets now, you're a dollar again We're now we're starting to pull off this low here Again, we're in a range. We're pretty much in a range So what we've got here is good support around about 107 60 106 107 80 And the likelihood is we could get a weaker dollar and we could trend back towards 109 109 and a half because we're range trading and we don't really know what else to do There's a really good layer of support in cable at 122 45 I recorded my weekly video yesterday and I talked about that level when we're around about 123 and a half And we went down and tested it on this two-hour chart yesterday And there we have it. We went down there and we went straight back again Um, and it's interesting to note that on this particular chart We had a very strong rebound off that level. So there's fairly decent demand down there But again, it goes back to what I was saying earlier FX markets are in a little bit of a range So it's very much a case of play that range because every single government is in exactly the same boat They're all looking to pump liquidity into the system And they're all looking at mitigating the economic damage that is going to be coming our way And financial markets are basically looking at all of this and thinking Who's the fairest of them all and to be quite honest, they're all pretty ugly So really where'd you put your money, you know, and and that's essentially where we are And it's the same thing for the canadian dollar Because we've also got the canadian payrolls report today And that is likely to be as equally as ugly as the us payrolls report So what we're looking at here for dollar CAD Is a system of not only the strength of the canadian economy But what we've also got is another range trade here and i've drawn it in a corridor or a price section here You also have to remember that the canadian economy that is very It's very closely tied to the movements in the oil price So there will be an element of range trading here, but the bottom of the range here It's 138 and a half 142 and a half. That's a 400 point range We're towards the lower end of that Again, you know, the numbers are going to be ugly 4 million April jobs lost for the canadian economy 22 million for the us economy and an unemployment rate That's just going to jump to 16 percent in the us And 18.1 percent in canada, which would be a record and i don't know why i clicked on that But i'm just about to close it. Anyway, we have got Just over 12 seconds to go Until the numbers drop. So i will be quiet and we will wait for the numbers to come out So they are now due 14.7 unemployment rates for And only two million jobs on the canadian jobs report instead of four million jobs for whatever reason The us numbers don't appear to have hit the table yet, so give me a second on that And it's 20 and a half million on the us jobs number So both of them slightly better than expected But certainly nothing to be particularly enthusiastic about I would argue The average earnings number 7.9 percent. Yeah, i'm sure that's not really a particularly accurate reflection Of where the market currently is and there we are. So finally hit the take minus 20.5 14.7 on the unemployment rate But You know to to a certain extent you really do have to ignore those numbers And the reason you have to ignore those numbers is because the actual real unemployment rate is higher than that So let's look at dolly n It's a slightly better than expected number So it's slightly dollar positive But You know once once you look past these numbers These numbers are already old. They're out of date. They're they're well out of date So it matters less In in the round than what's Coming our way. So we're getting a little bit of dollar strength on the back of that But overall it doesn't change. It doesn't change my overall view For whatever reason my chart is no longer updating which is useful So bear with me I have what I am when I try and Open this again My system is slowing down. So it means that what I might have to do Some might have to start shutting some systems down to try and free up some bandwidth So please bear with me Okay Well, I'm being asked. Sorry to sorry for the long pause there. I was just reading a question from someone Please feel free to here we go now. We're back. That's because I've closed a couple of a couple of systems down Now I've got some resource back um, okay, so basically I'm being asked if it's safe to go long on the back of Is it safe to go long until the global iron number is down and down persistently as a return investor? My fear is when such a sell-off comes we will end up On the worst end of a chaotic market and liquidity issues unable to sell I think in terms of liquidity Um, it's just a personal view here It's not really that much of an issue. There's also there is an awful lot of cash sitting on the sidelines already And I think if you do get a sell-off, I think there will be Certainly plenty of interested parties looking to get back into the market So I'm not as concerned about a lack of liquidity on a particular sell-off Simply because there's there's already an awful lot of liquidity there Already and what we have seen I think from now compared to what we saw in March and April was the fact that The moves now have become an awful lot more orderly than they were say for example Before the Fed came in started to talk about buying corporate bonds Junk bonds in some respects fallen angels and what have you so in terms of um Getting back into the market or getting out of the market. I don't I don't really think that's too much of an issue So the biggest problem at the moment is that governments The the next steps that governments take when it comes to trying to get their economies Restarted because they're getting pushed from pillar to post In terms of either keeping the lockdowns in place and there is a risk that they could keep the lockdowns in place for far too long And cause permanent scarring to the economy while at the same time not opening not relaxing lockdowns too early And causing a second peak. So there's always a balance to be had um, and There needs to be a debate about this. There needs to be a debate about about The death rate as a result of the spread of the virus alongside how the lockdowns are causing damage To the u.s economy the european economy in which the longer the shutdowns last That can cause deaths in the long run as well because lots of unemployment and depression You know economic depressions can cause death rates on a longer time frame. So You need to be able to have that discussion without the risk of being gaslighted because you're articulating the fact that You need to start thinking about reopening the economy and risking a little bit of a spike in the death rate In the short term to alleviate a much longer death rate in the long term And unfortunately, it's very politically difficult to have that type of conversation. So Those numbers better than expected minus 20 and a half million Dollar positive and that's really reflected in dollar yen, which means we could well see a move back to around about 106 20106 30 And we'll see euro dollar and cable drift lower But overall, I think what we've seen here at the moment is nothing outside The realms of expectation the expectation for this payrolls number was anything between 18 and 25 million Now the bay payrolls report this month's payrolls report is likely to be equally as bad You're talking 15 or 20 another 15 or 20 million Which if you wrap up with the the adp payrolls report that we saw earlier this week, which was also 20 million It's an awful lot of unemployed 40 to 50 million unemployed Out of the u.s economy of over 300 million people Or 300 million working age people you're talking 20 percent over 20 percent of the u.s population will be unemployed So i'm getting asked Can scotland afford to be independent yet or do you? I mean to be quite honest, I don't really think that's a political discussion that Can even be had in the short term I think there's much more important things to be discussed discussing the argument in 2014 Was the oil revenues would be able to give scotland the ability To be self-sufficient and that's when oil prices were 75 80 dollars a barrel They're not even close to 30 dollars a barrel at the moment. So there would have to be some form of Economic plan that allows for scotland to be able to run a persistent deficit and also To have a currency That they can print and not be reliant on an external central bank The problem that Greece Italy in spain have got at the moment Is a similar sort of problem to the one scotland might have if it goes for independence unless you have your own currency in your own central bank You find it very very difficult to mitigate an economic depression Um, and that's why this week's german constitutional court ruling Was very very important in the round in terms of the ecb's quantitative easing program Because what's what spain italy and greece need right now is large-scale fiscal stimulus Uh, which means busting government spending targets They aren't being allowed to do that at the moment Which means it makes it very very difficult for them to mitigate the economic shock coming their way So there needs to be discussions about renewables. Absolutely solar power Wind power the last time I went to scotland as you drive across the border There's loads of wind turbines um in In the dumfries in galloway area as you drive up the m6 and to the m74 um, and it's certainly a really good Good source of renewable energy in fact the uk economy has been running on renewable energy Pretty much for the last four or five weeks So it is very very much The way forward but there needs to be investment in it and it's not just about Public sector investment. It's corpora sector investment Royal dot shell and bp haven't been doing anywhere near enough when it comes to renewable energy um They've been relying on fossil fuels for quite some time You know and that is not going to change In the short to medium term But it needs to and it will do and I think more than anything What this crisis has done is it could well give governments cover to be able to take the necessary steps forward You know oil is a very very interesting Chart when I look at crude oil Particularly Brent crude. I can see that there is potential for a little bit of a base Forming here on this particular chart, you know, and we're looking at it But there's a big big resistance level just above 32 dollars a barrel and we've also got the 50 day moving average so if anything You're going to see a little bit of an underpinning of the Brent market But again, that will depend on how quickly these This surplus in storage rolls off and while people will start to drive more as the lockdown gets eased That doesn't change the fact ladies and gentlemen the It's still going to take an awful long time For those production cuts that kicked in on the 1st of May and forced production cuts by US producers going bust starts to bleed into the system or bleed out of the system. So until such times As oil demand returns to normal and we don't even know what that means, you know, what is the new normal? There will be an awful lot fewer people flying And an awful lot fewer people getting on planes Going to far-flung places And there'll be an awful lot fewer aircraft in the sky Over the course of the next 12 months. So oil demand globally will decrease and Oil production needs to reflect that and at the moment it doesn't so even though you may start to see the surplus run off We will still be consuming an awful lot less energy from fossil fuel As a result of the fact that you can't social distance on an aeroplane Who's going to get on an aeroplane? Even if there's only 20 or 30 people on it the air is recycled So social distancing on an aeroplane is just not feasible So, you know the airline sector the travel sector the retail sector We are all going to be living our lives an awful lot differently over the course of the next two years And that's assuming we don't get a second peak this winter when the weather gets colder and flu season kicks in There's so many different So many different variables in the markets as we look at it and those people who tell you that the economy is going to contract 20% this year and rebound 25% next year They're just guessing you might as well be basically throwing a dart at a dartboard blindfolded No one knows all you can do is react to what the price action is telling you and trade Accordingly and invest accordingly So you're getting a big move higher in the Nasdaq. It's wiped out its entire losses for the year So you have to look at your portfolios slightly differently. What companies are going to do the best in what is likely to be a new normal of a technology driven future Or in a renewable driven future Um, you look at netflix. I mean netflix is still nowhere near Profitable in the short to medium term. It's still running a negative cash flow Now it could turn to a positive cash flow yet. It's being priced As if it's the next big thing it's still the market leader But it is expensive on a valuation basis so um I'm being asked what cmc have done to wti crude Yeah, I mean an awful lot of people have had to rethink the way they value the front month in crude because of what happened earlier um earlier this month with respect to the The the latest expiry there is there is an email and an explanation on the website Which I will direct you to to exactly explain the reasons why we did that. I wasn't party to that discussion But at the end of the day, it's to mitigate and it's to protect not only Our clients, but it's also to protect ourselves against any significant negative impact caused by What is in an awful lot of cases been some anomalous pricing? So there is an explanation for it In terms of increased margin costs Which have been implemented by the exchanges as well Which have made pricing it much more difficult Okay, so let me just check all the other questions because I do want to make sure that I haven't missed anybody out What a hedging guard So bear with me while I just quickly look at All your questions if I've missed anybody if I've missed anyone out ask it again because I can only see about three or four questions at any one time um Okay, if you need to go obviously, thank you. Thank you for popping in appreciate appreciate your time ladies and gents um uk 100 Obviously the I've been asked about us china trade talk impact Anything that prevents further tariffs on us china trade is going to be net positive for the markets I think the last thing I think what you also have to do is talk You have to look at this us china trade talk in the context of trump looking to get reelected in november So there is going to be a certain extent of playing to his domestic audience When he talks about china So sometimes it's less about the substance It's it's more about the substance and less about the rhetoric the rhetoric is generally tend Tended to be directed for domestic consumption. It's really about the substance behind the scenes Now with respect to the buzzi 100 the uk 100 same rules apply here We've got a similar sort of similar sort of chart to the one that I was showing you on the dax In that we've got the potential for A little bit of resistance anywhere up near 5950 It also coincides with these peaks over here in april and then you've got a head of price action here So I've drawn a horizontal line through there I'm also going to draw a Line through here What we've got is the potential For a little bit of a neckline or a head and shoulders now. I've drawn it through there. I could equally draw It's through there You're getting a little bit of an edge higher But again, you know, I wouldn't be looking to go long at these sorts of levels at this point in time Near these highs ahead of a weekend. Also, you've got the fact that because uk markets are off today The liquidity is likely to be a little bit less because London is closed but but overall I'm still very much a case of By any dips until such times as the upward trend lines that I've drawn on these charts are broken And if we get back to near these resistance levels here I'm playing the range I'm playing the range that we've been in for the course of the past few weeks So selling near the top of the range buying near the bottom of the range You're not going to get or capture a big five or ten percent move if you're trading these sorts of markets Unless you're very very lucky What you should be looking to do is taking in a hundred points here 120 points there 70 points here 80 points here don't get greedy Always remember to take your profit if you're going to run a 50 point stop loss Then you should be looking to make a hundred point take profit because on the basis of those numbers You should generally come out ahead if your win-lose ratio is 50 50 If you lose 50 percent of the time and you're making more money And you're making more money 50 at the time every time you win You'll come out ahead I've I've lost count of the number of times that people Don't run their profits, but do run their losses. That's completely counter-intuitive to me Yeah, if by all means change your minds But unless you allow your profits to run You will never come out ahead if you're 50 right or 50 wrong It's the it's the law of averages bring your stop loss up But don't chop your profit early, you know, think about your profit as much as you think about your losses I think that's Incredibly important and I think it's something that gets forgotten an awful lot I'm getting asked about the Nikkei. So let me talk about the Nikkei Had a very strong end to the week For that Here we go Japan 225 And you can see from this chart here, it's very very similar to the DAX It's very very similar to the FTSE and it's very very similar to the s&p. This is why When I look at global markets, I look at them all I look at them all within the round because there is a correlation between all of them Let me just get rid of that line there. Here we go So if I again zoom into the four hour chart changing the period there We've got a slightly higher peak here on the Nikkei I mean, I think the Nikkei is also slightly skewed by the fact that the bank of japan Owns about 70 percent of the ETF market Which means that you've always you've always got a buyer of last resort there So if you're going to be long of any market, it's probably going to be the Nikkei because It's unlikely the bank of japan will allow that to collapse and let's not forget We are still well below the all-time highs in the Nikkei that we saw in 1989 when it was trading at 40 000 double where it is currently now so If we draw a line again through here We can see that any pullbacks on the Nikkei are likely to find decent support anywhere near these loads here And you can see them. They're quite clear. You've got a nice low there a nice low there and a nice low there So if you're looking to pick up the Nikkei on the cheap Then buy anywhere near these loads here with the tight stop loss looking for a rebound or a rebound back What you're doing is you're playing the percentages when you're playing these markets And if a market has found support at an area previously It's likely to find support there again. That doesn't always work But but as a general rule of thumb they do tend to be quite reliable And if it does break below that then you'll stop loss out and you've taken a small loss And as long as you can minimize your losses and maximize your profits Um, you should always come out ahead. No one and I mean no one makes a profit Um all the time you will always take losses You know, and it's your ability to Shrug those losses off and put them down to experience That allows you to then put the next trade on you should never be afraid of making a loss um You know, it's called emotional intelligence Your you will make a loss on certain trades. That's inevitable and you have to accept that But the skill is how you bounce back from having a negative day You really do have to analyze you need self-discipline. You need To be able to document every single trade you do Understand the reasons for why you're putting it on Don't just jump in and there will be days when you have bad days You wear everything you touch goes bad Except that it will happen And the hardest thing to do is to walk away walk away Leave it alone And clear your head because the more you obsess about it and the more you get anxious about it The more likely you are to make another bad decision Step away Get some fresh air take a break clear your head and look at why you've made the losses I've been you know, I was I was I was I was a currency trader in the 1990s for five years I traded spot dollar yen. I did cable. I also traded Australian dollar fours and an Australian dollar depot book And one of the key lessons I took away Is that I learned more from my failures than I did from my successes If you have too many successes you become complacent You lose your discipline and then the market comes back and bites you and reimposes that discipline on you So, you know for for me, I've learned some of my lessons the hard way I've also learned from learning from other people's mistakes You've constantly got to analyze yourself you constantly got to analyze every decision that you make Because there will come a time when you hit a run of losses and the key to Mitigating your way through that is to keep yourself in the game And not chase losses because being square you can be long short or square Being square is a choice just as much as being long and is being short And as long as you remember that and are able to try and push your emotions your emotions to one side And it's difficult. I know But you must push your emotions to one side And impose rules on yourself and your trading and that is very very important Okay, sorry about that I went off on a little bit of a It's a bit of a hobby horse of mine that So my view on the the nick a 225 is pretty much the same as it is and all the others Looking to sell into these peaks here Keep your stop losses tight look for a pullback. We're in a range Likely to be in a range for quite some time to come when we drop back towards the lows look to buy the dips The Dax was pretty much the same There was a there was a there was a nice resistance Near the highs which we're currently at at the moment If you look at the if you look at the Dax chart, I'll quickly just show that again for those of you who've missed it Here we go. Let me just change that down to four hours There we go So again, we're near resistance at the moment You've got this head of price action here shoulders here So keep your stop loss tight on any short position and look to pick them back up down here If that's if that's the way you're inclined Dale Jones is going to be fairly similar to the s and p 500. There are fairly similar shapes What are my thoughts on tesla? Yeah, I mean, I like the idea. I just think it's overpriced Um, let's have a quick look at tesla. Just look at my car manufacturer's watch list Um, obviously tesla is not open quite yet. So let's just scroll down. Where are we? There we go I mean, I don't like Elon musk um I mean here what we've got is I would suggest that You know, we we're in it. We're in a nice uptrend here So let's draw that in So the trend is your friend, but It does look as if it's finding a little bit of a plateau I think as long as we stay below these april highs here, which is around the bow 870 870 dollars So 900 dollars Then we are vulnerable to a correction lower. I think there's an awful lot of good news in the price for tesla And i'm not convinced that it's worth Being the second most valuable car company in the world behind toyota Simply don't I mean, it's it's got a higher market cap than vw And i'm sorry that it's just a bonkers valuation But again, it goes back to what the price action is telling me here And we are in a nice little uptrend, but when I look at its valuation relative to Say for example, it's peers It's off the chart completely off the chart um One of my best indicators I try and tend to keep it fairly simple when it comes to um Analyzing so my best indicators the indicators that you see on every chart that I've shown you So if I go I'm going to use the us 30 because someone asked me to look at that and I haven't done that yet So I'll do that. So here's the us 30 and here's some analysis that I've already done. So essentially I look at two moving averages the 50 day and the 200 day I only take notice of those moving averages on the daily charts Even though they are on my four hour chart here at the moment. I pay very little attention to them essentially Those two moving averages on the daily and the weekly charts are ones I pay close attention to because they're long term directional Trend indicators and very important in the overall context of where we could or good could go to next And a simple slow stochastic um The general parameters for slow stochastic the 10 6 6 5 3 3 15 9 9 I use a bit of a hybrid myself. I use 10 6 3. It works for me Um, and it was something that I developed very early on in the 1990s It doesn't work for everybody You have to find something that works for you Because my mindset has basically been developed and tweaked Alongside the way that I feel most comfortable But the most important indicator for me Is the price action and what the highs and the lows are doing relative to each other And at the moment what we've got here is we've got compression in the price action. We've got higher lows But we've also got Lower highs and yeah, we have taken out this high here But I think while we are below this series of highs through here It's a similar sort of story for the dale as it is for the s and p We are at some very very key Resistance levels if I take this back to the daily chart And I do a Fibonacci retracement on this chart. So I'm going to do that now Take the fibs on this And do that we're still below 61.8 and we are also well short Of the 200 day moving average Which again is a very very important moving average In terms of long-term direction So I'm just going to knock out the 23.6 because that looks a little bit cluttered And the 38.2 because we've already gone through it So the two in the two retracements that I'm looking at at the moment are the 50 and the 61.8 and to a certain extent We're trapped between those two indicators there. So Until such times as we break above the 61.8 Fibonacci retracement level on the dow the s and p And the 50 percent or 61.8 on the footsie 100 and the Dax and the Nikke For me the upside in equity markets is limited because it goes back to dow theory the averages need to confirm each other We are in a global economy Which means that For all equity markets to go higher you need a correlation between all of them So you need all of them to break higher or none of them to break higher So if you get for example the nikkei breaking higher and the s and p doesn't then it's likely the nikkei breaking higher is a false break So correlations are very very important And I look at the s and p the Dax and the nikkei. There's a three key major indices in terms of long-term direction either up or down so I would need confirmation of a breakout to the upside on all three to have confidence that we're going to revisit the highs for Global equity markets. Hopefully that makes sense any advantages to using exponential moving averages Not really again an exponential moving average. Yes, it does take into account all of the price action But ultimately it's very much a lagging indicator So any move on an on an exponential moving average is always going to lag behind the price action Um, it's a good, you know, it's a good indicator in terms of overall long-term trend But over and above that it's a fairly limited use. I mean the fastest moving average you can get Is a one event moving average and that's a line chart by any other name And then you have a two-day moving average a three-day moving average four five six seven eight nine ten You know shorter term moving averages of sorts a three or eight or three or five tend to work better on short-term charts in terms of trying to time Changes in a short-term move, but again, you still have to price in the fact that they are lagging indicators by definition The NASDAQ is over the 200-day moving average You're absolutely right that index is different and the reason it's different I think is because it's very much a technology based index And it has a mind of its own if you take all the tech stocks out of the NASDAQ Or the s and p Markets are an awful lot lower. So you've got inherent bias in the NASDAQ. You've also got it on the s and p Probably to a slightly lesser extent, but nonetheless the NASDAQ is more of an outlier than anything else That's not to say that it can't retest the previous highs But I would be very surprised if it took them out and carried on going higher So hopefully that does hopefully that makes sense. Yeah, you're absolutely right The NASDAQ is above the 200-day moving average But for me, you know, that is very much an outlier to all of the other global indices You have to look at that in the round, you know, if you look at say for example the NASDAQ and then compare it to the Russell 2000 The Russell 2000 has actually been trending lower So which one do you take notice of if I look at the record highs on the Russell? We hit them last year All the way back here And we never took them out again So while the s and p and the Dow were hitting record highs earlier this year the Russell wasn't How do I analyze the Hong Kong? 50 With great care Is my answer to that particular question. This is a one day chart And again, it's surprising actually how similar it is. But again here what we've got Is lower highs and lower lows If anything what I would want to see from this just at first glance Is a retest And a recovery above this 25,000 level here. Why because it was a very very important level on the way down Can you see how this support level? Held on a number of occasions and when it broke It went aggressively lower and now we're looking to retest it So for me, I think it's very very similar story to the Hong Kong Um It's very very similar story to all the other indices. I think if the chinese economy Recovers and there's no evidence that it is because if you look at those retail sales numbers that we saw um Or could see because they're coming out next week Um, I think the retail sales numbers will give us a good indication For china as to whether or not the chinese consumer is starting to feel more confident about the future The trade numbers that we saw earlier in the week showed that imports were still in decline And exports even though they were better than expected were largely boosted by the fact By medical exports. So For the last two months chinese retail sales have declined 20 and a half percent and 15.8 percent um, so even though the lockdown happened in february chinese consumers didn't go out and spend in march And the likelihood is we're expecting another decline in april so The chinese consumer still isn't a hundred percent Wedded to the idea of a v-shaped rebound so for me I think the sooner that the chinese economy starts to Start far on all cylinders again the better And at the moment there's no evidence that's happening. So that makes it very very difficult to really Draw any conclusions as to whether or not we're going to get a rebound in global economic activity because let's not forget one of china's um All of china's key trading partners are still in lockdown or only just coming out of lockdown So in terms of an export led recovery, we're just not going to see it Not yet. It's going to take at least another two or three months And that will really depend on how quickly the lockdowns are eased and then how Quickly consumer behavior returns to normal and to my mind the way I feel at the moment That's going to take an awful long time. I'm not going to be getting on a plane anytime soon And if you extrapolate that out to pretty much everybody else That's probably going to be true for an awful lot of people From my point of view is a nest egg safe to remain on the market and continue investing I am very much of the opinion. I have cash to spare But i'm going to sit on it until I see an opportunity to spend it so I'm not going to go into the market for the sake of it if an opportunity Makes itself available And I can see a long term reason for investing I will invest or if i'm looking to get into the market I will use something that I will look that allows me to diversify My risk You know and part of that risk could be share baskets So rather than basically investing all my money into say for example Microsoft or facebook I might spread that risk Into a shared basket that covers Say for example social media Which has alphabet Twitter facebook it spreads your risk across A sector as opposed to putting all your eggs in one basket You know share baskets is a fairly new thing that CMC has just launched So for example, we've just launched a share basket on EU automobiles So that will basically give you exposure to companies like Renault, Citroen, Peugeot, BMW, Volkswagen Porsche and what have you and you can see On our website How we've calculated the various baskets for each individual Basket, so there'll be a 10% waiting to say for example Some somebody somebody like BMW And it'll be an equal waiting for each one so So so that those are coming and in some cases have already been released and we do have other other ones coming as well So we have a basket for 5g Automation and robotics if you want to find out about them go to the website and it will basically drill down And tell you all the components for the various baskets We've even got a basket for renewable energy for us renewable energy stocks So we can we can view that here And you can see that basket here And as you can see we've seen a quite a strong rebound in that particular basket and if you again if you want to look at the components then We just go to the website And it should display that information Underneath markets Shares shares baskets. There we go. It's right there And then you should be able to scroll down And find and there we have the themes for you. So for example, if you want to do renewable energy Click on more details And then that will outline the various components. We've even got one for cannabis If that's your particular interest. I haven't covered gold. I will do that in a minute So if we look at the constituent weightings for renewable energy That displays them there. So you can see on that particular basket It's got quite heavy weighting for in phase energy terraform power for solar So on and so forth. It also gives you the margin rates and the trading details share baskets. It's worth having a look at There Okay, so let's go back to gold So gold is there In answer to your question about west texas crude. We've had to basically use the front month of We use december as the front month on that because of the volatility Now gold is a very interesting one and we've explained the reasons for that on the website So if you're a client of cmc, you should have received an email Outlining the reasons as to why we changed the wti and it was largely due to the fact that The exchanges have increased certain costs relating to the front month contract to try and take some of the sting out of the volatility Right, let's look at the gold price. It's trading in a nice triangular consolidation These are lines that i drew earlier It's looking a little bit risky up Towards this sort of area here if we break out above this level here Then we could see a move higher But at the moment we're consolidating in a bit of a sideways range If we get a break either side of these Either one of these trend lines We could well get a significant break lower or higher at the moment It seems likely that we're probably going to trend back down towards 1680 But overall given the fact that we've got support here and here It's probably going to be a short term buy within this overall range So hopefully that works For you Um, we also have crypto indices just been asked a question about that Okay, thank you cathol cathol appreciate that. Hope you're um, hope you're faring well over there in Dublin Um Okay, um automakers. What's my take on automakers? Well Oops, sorry wrong one. Give me a second Depending on I suppose if you want to look at the automakers basket That should probably tell you what you need to know actually Let's let's just bring that back because I think that's that's quite useful Go to share baskets If I look at automakers as a basket that probably gives us a better idea of the overall trend where it comes to Car makers in general And we can see here. It's actually quite instructive that the auto sector Just close that down Looks fairly similar to the german dachs In terms of makeup. So let's just turn Let's just make that font bigger so you guys Can actually see it Because I'm pretty sure that you can't see that font The way that it is at the moment So I'm just going to change that font to slightly to medium and go to bold and done There we go So Based on this nice little uptrend in place Look to buy the dip look to buy the dip on that until such times as We break this uptrend line here trend is your friend. It is looking a little bit toppy anywhere near here Through these highs through here. So on automakers If I'm looking to buy a car I'm probably going to defer some I'm probably going to defer that until the outlook for The economy is slightly clearer. So I think automakers have a big mountain decline in terms of migrating their fleets to use less fossil fuels and more electric power But also You have to take the view Is the rebound that we've seen at the moment the extent of the rally or are we going to start to test lower? So I probably look to sell the sector into this line here Stop loss above there And then look to pick them back up down around here this 2400 area Overall, there's going to be an awful lot of Adaptation going on with respect to auto sector. You look at the problems that Aston Martin has had To give you an indication The fact that Ford's corporate bonds are now junk I think tells you all you need to know about the sector. It's in difficulties But people will always want to be able to drive a car. So You know for me, I think it will adapt. I think it will be difficult And there will be many bumps along the road. No puns intended Right, I think this has gone on for slightly longer than I anticipated ladies and gentlemen So I'm really going to have to wrap this up now. I'd like to thank you all for Your forbearance. I'm so glad to see so many of you still logged in But I will be doing another one of these webinars Same time next month. I will probably still be in my attic office here at home But thank you for all your questions. I really do hope you all have a great Pleasant holiday weekend And I'd like to thank you all and I will see you all or speak to you all I should say I should speak to you all in a in a month's time. Thank you very much for listening and have a great weekend