 Hello traders at CMC Markets, welcome to a fresh update by RRG Research for Monday the 15th of August and I am recording this on Friday the 12th before the market opens. My name is Julius de Kampenaar and I am presenting to you from Amsterdam in the Netherlands. Few things that I want to talk you through today. As usual we start with the RRG showing the rotation of world indexes. The chart on your screen is the weekly RRG of a group of world stock market indexes against the MSCI world. What you see here is a high concentration of tails on the right hand side of the graph, there is a few in green, a few in orange. That basically tells us that the overall trend of world stock market is up, good for the moment, especially versus the MSCI world and the group of indexes that we have on the screen are the major markets but as you know the MSCI world consists of a lot of markets also a lot of smaller markets and what we see here is that these bigger markets so you know US markets, Hong Kong, Europe, DAX, Australia, UK, Japan, they are actually doing pretty well in relative terms and a few that I want to take out, a few observations are US markets, it's in NASDAQ, it's the Russell 2000, CSMP 500, they are traveling at a strong RRG heading, that is good, they're still picking up. If you look at the other tails, the majority of them, they are at what we call a negative RRG heading, they're moving lower on both the JDK-RS ratio scale and the JDK-RS momentum scale, the RS ratio is the horizontal axis and the RS momentum is the vertical axis. This tells us that US markets are picking up against the other major markets and the weekly picture is actually fairly clear in that respect. If I switch to the daily image of that same group, you see that it's a lot more volatile, you see a few tails that are making big zigzag moves but the reason I'm, so it doesn't really tell me a lot, it tells me that there's a lot of volatility, a lot of uncertainty going on but the reason I'm going to show this chart is because of two things, it's because of the tail of the Nikkei index which is heading, moving into the lagging quadrant and the Hangsang index which is way to the left inside the lagging quadrant, it's picking up a little bit of relative strength, relative momentum but it's sort of detached from the rest of the group, look at that, it doesn't even fit on the graph. So it looks as if these Asian markets are weaker than the rest, it's sort of disconnected and if we go back to that weekly chart and look at the Hangsang, it was very good and it's now moving much lower and the Nikkei is actually, if you measure it in terms of RS ratio, it's the strongest market, it has been the strongest market, it's now rapidly coming down, so I think there is an opportunity to play US versus Asia, so either the S&P, the Russell, the NASDAQ against the Hangsang or the Nikkei index or maybe even Australia or the DAX or the UK but if we stick with the Asian markets because of the reason for picking that is because of the weakness on the daily chart, so then we have a weekly and a daily alignment and if we bring in the individual charts then we can see if we start with the Nikkei, you can see that it is inside a trading range, this is a weekly chart and it's touching the upper boundary of that range and it's running in trouble around that level, that's like 28,000, that's where the Nikkei is running into trouble and you can see that the RRG lines are actually rolling over. If we look at the S&P, the S&P 500, then you can see that it is, it's in a resistance zone but it already took out the previous high, it's not the strongest chart from an absolute perspective, not at all in my view but it's very good in terms of relative strength because if you look at the RRG lines on the S&P chart you can see that both lines are moving higher whereas the RRG lines on the Nikkei are actually both moving lower and the red RS ratio line has just rolled over so that gives me, that makes putting the S&P versus the Nikkei a good opportunity to benefit from the difference between the US market and let's round it off at the Asian markets. So US improving versus the rest of the world, daily rotations kind of jiggly but very clearly weakness in the Asian tails especially for the Nikkei and the Hang Seng and if we look at the individual charts for the Nikkei and the S&P it looks as if the S&P is going to get preference over the Nikkei and if you zoom into that it's probably not because of the super strength of the S&P but because of the weakness of the Nikkei index. I want to wrap it up with a look at Bitcoin. I don't think we've ever looked at Bitcoin in this show or cryptocurrencies in general but I think there's an interesting period going in. I mean Bitcoin used to be in the news all the time and that has slowed down a little bit. Obviously it's still a very very tradable market and I was looking at this chart the other day and especially from a longer term perspective, I mean it's such a nice example of how a freely traded market respects a lot of the technical rules. First of all I think that when Bitcoin broke below 29,000K back in June that was the completion of a very big top formation for Bitcoin US dollar. It was followed by a rapid decline and that found support at the level of the previous high that we had at the end of 2017, start of 2018. So old resistance worked as support and I think that's an important statement because what we will see, what I think we will see is that this old support level around 2930K will start to act as resistance on the way up. That means that the rally that we are currently seeing the bounce of that 17K support level is a rally within a downtrend. It's a countertrend rally and that's an important premise, that's an important assumption. If we look at the daily chart of Bitcoin versus the US dollar then we can see that it's actually trying to work its way higher. It's got higher highs and higher lows, not super strong but you can also see that that and these levels are coming from that weekly chart that there is heavy resistance coming in around 30,000K. So the upside potential is relatively limited, still a couple of thousand dollars but in terms of Bitcoin that is a limited upside potential. What's happening here looks like a rising wedge in the making. It's called a support line that's angling up and it's got a resistance line that's sloping up but at different angles and they're converging in the future and that is usually a bearish continuation pattern. So two things can happen. The preferred breakout level, the preferred breakout direction for a rising wedge is downward. If that happens the minimum price target is the start of the wedge that is around 17,500K. If we break to the upside then the wedge is void but the upside is still very limited and we will probably see resistance coming in around 13,000K. If Bitcoin breaks below its previous low assuming that this downtrend continues that's not a weird thought. Then the next level to watch in Bitcoin is only found around 12,500K. There is not much in terms of previous highs and lows in between that can catch a renewed decline in Bitcoin. So my take on Bitcoin is that a very big top has been formed. The initial decline found support around 17,500K, 18,000K. We're currently seeing a bounce of that former resistance level that's now acting as support. We could reach 30K. We could go back to test that old support level as resistance but on the daily chart there's already negative divergence in the RSI and 24,500K is looking difficult for the market. We tried it a few times but last month looks like a rising wedge is forming. If that breaks downward for a target 17,500K, if 17,500K breaks we have to look at 12,500K as a target for Bitcoin. Thank you for watching. I'm looking forward to see you again next week. Same time, same place.