 Okay, well welcome to the CMC markets weekly charting analysis webinar with myself Jasper Lawler. Just have the risk warning on the screen in front of us, we're going to have a look through that and then get to the markets. Should say any questions at any time, just feel free to send them any time in the chat or the Q&A boxes and I'll be happy to do my best to answer those at any stage. Be at some particular asset class you are looking at or particular charting pattern or news event, wanted some opinion on it, certainly happy to put that across. Okay, so to be honest with you, not a lot in the way of economic news out today, only was the big one really was earlier in which we had GDP reported from Japan, that as you can see quarter over quarter in our market calendar here and Japan basically didn't grow over the quarter and over the year it's only grown 0.2%. Now the market reaction has been fairly sanguine, you know I think partly it's partly summer trading but also just partly that the government of Japan just introduced a massive new fiscal stimulus package and so the hope is that that can you know help growth going forward and to some extent it's understandable that Japan's economy has had a bit of a pullback, the yen is appreciated quite substantially of late and indeed oil prices have pricked up as well so Japan's a net importer of oil so Japan does well from lower oil prices but I think one thing it does do is you see Japan which is the third largest economy in the world seeing its growth stall you know that's after figures for Q2 in the US coming below expectations same in Europe coming in you know definitely down on the first quarter there's obviously a bit of a slowdown happening globally and so when you look at these equity markets as they currently stand you know US market specifically up in near record high territory you know I think it's a fair conclusion to route so there's not because of economic growth it's you know it's not because of economic growth but then also corporate earnings have been coming down and prices have been going up so people aren't buying because there's bargains to be had in terms of valuations price to earnings ratios are going up because the price is going up and earnings are coming down it's getting stretched from both directions pulling it higher so markets are what you could easily say overvalued or getting more overvalued and and growth a global economic growth is slowing so you know what else is there to justify this rise in markets well I think you know it's probably no mistake that if we just jump across to the UK 100 here that we're aiming for our eighth day of gains today and when did those gains start well they started on Thursday the week before last when the Bank of England cut interest rates so I think this is as it has been for really a number of years now it's a pretty it's a central bank low interest rate driven rally in stock markets some some UK treasuries in the UK guilt's in the last year last week dipped into yielding negative so you know that is obviously to say that it's it's not too much of a return to be had from investing in in a bond market some people people still are buying it obviously that's half of what's the price driving the price higher but you know they're not getting good returns so those who are looking for good returns they may they go into the stock market so that that's you know obviously part of the story as to why low interest rates are good low interest rates are also supposed to cause companies to invest that's not happened obviously as much as we'd like it's actually been consumers spending and so you could say that the consumers spending has been driven somewhat by rising house prices and you know lower mortgage payments so you got a bit more extra money in your pocket on your on your mortgage probably on your car loan as well enabling you to go out and spend but if companies aren't investing not to not be trying painting a massive down a picture here the UK economy is doing fine at them yeah I'm saying some of the risk here for the UK and Germany and indeed the US is that that's sort of underlying strength from business investments not quite there we're kind of relying on consumers and consumers somewhat supported by these low interest rates at the moment rates look like going down if anything you know one thing you can say from the Bank of England cutting interest rates it was meant to be the Bank of England and the Fed raising rates together against everyone else cutting rates now the feds on their own you know people are scaling back their expectation as to when the Fed will raise rates you know we were just talking about Japan if I scale across to Dolly Yen because someone was asking about it there Richard here you can see that for the most part the dollar has been kind of dipping you know some of that is some of this is like a rally in the Yen because there's you know there's there's a question mark over whether the Bank of Japan has the ability to do any more easing which would devalue the Yen but there's also amount and a general element of dollar weakness here because as I mentioned the pound cutting interest rates is actually caused some weakness not only in the pound but in the dollar because again how can the Fed really substantially raise rates whenever the other central bank is going in the other direction it's policy divergence is is really the key phrase again at the moment so I'll get back to that chart specifically let's run through some of these so that's I think a bit of a general backdrop as how I'm interpreting things but let's get into some of these charts specifically now now I said last week and I think the week before you know just because we're you know we're up near record highs you know it's not a reason to to think that old prices are too high we have to sell every time we start a new bull market it requires taking out old highs so don't get scared just because the market's high and you know we haven't gone massively higher but we have gone higher in markets and you know just take what the price is telling you rather than what you perceive should be the case you know like I said company earnings are going down the economic growth is a bit weak you know why stocks higher should sell them you know the record highs let's sell them again that might work out from a longer term perspective but for the moment from a kind of trading perspective the trend is higher so we did so we this with this this block here marks this Brexit peak up to the former record peak from last year and this is the US 30 made up into record territory we slid down into this zone that I kind of marked out we put in a low here and then we we broke out to the top side this this this was the Friday following the Bank of England vote I believe and so what happened here is that this particular day here is August 1st was a was a peak so we had a lower candle on either side on this day we put we pushed above it so we were back into a short-term uptrend once that high had been taken out and so and then we made another small high here made a you know made a low here where there's this this candle has a high on either side and we pushed higher again above that previous high we've dipped down towards these you know these closing levels but now we're pushing higher again and this this marked line marks that new high that we reached just at the tail end of last month so again a push through and a close above that old high and it's it's another confirmation that we're in an uptrend but still making gradual higher highs and higher lows here you know this is an uptrend until to my mind the first the first sign of weakness for this market at the moment as it stands you know if we put in another higher low up here it will change but the moment there's no real reason to get worried about this market until we drop below this 18 480 which was this low from from the 10th of August and and if we squeeze playing from the games to me at the moment there we go if we we jump across to some of the other indices it's a similar story so worth noting today that the German Dax just went into positive territory for 2016 see that if you read my mid-morning note this morning in the insights so you can see that here this is when we kind of gap down at the start of the year on our price chart we've obviously recovered prices inside of that gap so now as of today up into that this you know this was the this was January this was December so we're back up into those December prices now and you know I've marked out the the points at which I'd start getting worried about this market would actually be way down here right back at the 200 day moving average because we haven't really put in a low since then you know as I'm suggesting what a low could be you could argue that this perhaps is so this would be a more conservative option we've got a low here 10 632 the low on this candle 10 634 so you could say this candle is slightly lower so if you want to be a bit more conservative time to be worried about this the rally in the Germany 30 will be for drop through that daily low then you could you know you can drop down to the the lower time frames obviously and see it a bit more clearly quite a solid bunch of support for several four-hour candles in a row and attempt to break down there in a big push higher so again it's the markets are gradually edging higher and to my mind until this level gets out and then more significantly down here you know we're uptrending and this is a theme across equities again UK on 100 we already looked at a little bit but some if I give you an idea where I'm getting some of these levels from I go to the weekly chart this was a significant level pretty much was a barrier for most of 2013 and 2014 this sort of sort of just just size 6900 really it's 6875 I've got it pinned on my chart 6875 to 6900 is a big level we're above there now so we're running into this couple of lows here before we broke down quite big in May last year but to my mind at the moment it looks like we want to challenge the record highs it looks like we want to challenge 7000 at least which is big sort of psychological number obviously for the for the FTSE and again if we scroll down to the daily charts this was a lower low here so you can see this this is where we put in a peak and then we tried to break a few times we didn't get any closers above and we caused a drop down but once we once we pushed above that old peak again you know then we're into our grads uptrend and so again I you know I would say if we move that up to here this would maybe be the level just about being worried about the uptrend unfolding this this lower low here within this uptrend and then bit like the Dax lower down you can obviously pinpoint this low but you know just because the market looks overstretched obviously you know if you're already long the market no point in just massively doubling down but you know still short-term fresh entries it's still you're still going with the trend so if you get pullbacks to say this you know you can say this was pay-per-view you know again it's difficult to see sometimes on the daily chart this was a higher high and we drop down to the four-hour chart we can see easier here that with these these two peaks the market pulls back into here then to my mind you know within this uptrend that offers some sort of opportunity but then again if it drops down through that low you know we're kind of looking at this consolidation area you know then that would be maybe the time to get more concerned but only only below that level of close below so looking pretty well supported in equities in general see you know like I said there's obviously risks out there and it's not like it's you know last forever at some point there's going to be something that flusters markets you know things like the the VIX which measures volatility that's right down there at the moment so sort of showing a bit of complacency in the market so yeah at some point there's going to be a shake down but it's not happening yet so I think I'm going to call it a day there in terms of indices you know there was a specific request for Dolly Yen so I'm going to jump across to currencies for now so let's just get a better context as to where we are with this clearly a downtrend on the the longer timeframe you know below that 200 week moving average the the 50 week moving average very much down sloping but still quite a fair distance away yes the price could see a substantial rally would still be below that down sloping line but just to give us an idea of the general trend and this down sloping trend line working pretty well that said we're running into you know this is a very nice example of a downtrend but we are running into 100 which is a big psychological number and so I think there is some scope for for a bottom sometime around some place around 100 you know I can see it eventually going lower but I think 100 is proving to be quite a big barrier but it's a situation where you're obviously going against the trend if you're going along around 100 but again you've got a pretty pretty good idea when you're wrong if you know if you're trying to essentially pick the bottom the market here you know if we dip much below this low at 99 then obviously you know the market has made a new low you know that's suggestive of downtrend it's not a time you want to be buying so you know then you would be getting out but you know look look for signs I would say of a reversal in and around this 100 to 99 area we've not quite had it yet we're really just in kind of consolidation phase at the moment so it we've not had a big dip down reversal but one thing to keep in mind is you know just these these high high these highs they're being made so that's a high there and that's a more significant high above it you know so look for a close above you know obviously just 102 you can see as well the closes are taking place and we've got a little false breakout above it but that peak is at 102 27 and then this next peak here from the 8th of August you know that would be yeah like a little double bottom if we got it if we got above there and that would mark a bit of a shift in the trend we've all you know and then likewise a drop through one of the lows that we've been making down here I would suggest pretty much the sort of one at 165 type area you know that would suggest that the trend is continuing to the downside so worth jumping straight to cable pound against the dollar because there's a there's a good amount of UK data out this week you know no surprise by the way that the pound has pretty much been down I think it's actually been down nine days in the truck we've got a small update there was pretty much flat but yeah at the foot he's been going higher the pound has been going lower you know the pound dropping is supporting some of these multinationals that you know maybe maybe reporting pounds but and many in dollars and other foreign currencies so again possibility that we're putting in a bottom in the pound you know this scope for a double bottom around this 128 but we're not quite got these the evidence for it yet one thing you can kind of do here to get a kind of idea where the zone of interest is is if we talk if cool this the peak not the peak the trough obviously they're kind of the low you know this and then take it to the higher the next candlestick it's this kind of area that it's been you know obviously we've got the bounces back there from from this high they've got taken out was resistance as a peak lower candles on either side came back and acted as support but down through that support now so to my mind we're probably heading down towards the bottom of this zone down to the 128 again so we really need to test the metal of the bears can they actually take us down to new lows beyond that kind of that post Brexit uncertainty low but as I was saying there's lots of data this week which is really the first set of data that we've had post the referendum so basically data for July up to now we've just had the June data so we've got retail sales inflation and unemployment data all coming out this week from a Bank of England perspective the inflation data should be the most important but inflation is relatively low and the chief economist of the Bank of England just in the last I think was this weekend basically said something along the lines of their first priority is growth and jobs well really it's not their mandate is to just offer price stability their job is not anything to do with growth and jobs but they've taken upon themselves to make that their job and so from that you probably got to say that the the labor market data is going to be one of the most significant data releases this week if we see signs that businesses are scared of hiring people after the Brexit referendum then it increases the odds that the Bank of England do more than they've already done so add to the quantitative easing cut rates down to zero maybe even at the next meeting so you know for the data this week is on the poor side particularly the jobs particularly the average hourly earnings that come out alongside the unemployment data that could be the trigger for seeing us below 128 and at the moment that the trend is down but we're just still above that you know that kind of major swing low and we'll have a look at the euro obviously still one of most actively traded pairs but just still acting as a bit of a bit of a dog bit a bit tricky to really pinpoint the trades here so you know really it's kind of it's inside of sort of upward sloping range that can change if we get through this one 2360 that I've highlighted here you know we had a brief high here and we tried to get through it it was a bit of a false breakout so again we need to get above out of this kind of range here again then the next target would be that high then we could start getting excited about a move back up to the highs up here but at the moment still kind of stuck below that 112 36 to 40 type area the one thing that suggests that we could get above there is the fact that we've broken this downsloping RSI trend line and probably the final trigger for it would be if we see a matching break of the sort of price trend line that comes in a bit above so that the RSI momentum is already broken if we get price above that old peak and then above that trend line you know that could be the sign that we're pushing up to 114 again but we're not there yet so I suppose while we're below that 112 36 to 40 you know probably the biases that we head back lower into the range until we get that that next confirmation and also worth needing just Euro sterling we've been talking about this level for a number of weeks but we finally taken out that so you know we were looking at that low in cable for a post Brexit the Euro Euro pound pair has made the kind of has it has an opposite high it made at the same time it's taken out that high so you know we're above this 86 25 very much in an uptrend for you for euro sterling highest in over a year I believe we scale up to the weekly chart you know obviously had a prolonged drop in the euro was as the drug he was you know talking the currency down and promising all sorts of quantitative easing etc that's almost been completely unwound but some big long-term resistance up around from these two peaks starting around 87 70 I would say is probably the 87 70 up until the 88 is pretty much massive long-term resistance so you you'd imagine that there's going to be some sort of significant pullback in that sort of area for the moment the trend is higher though okay and a bit of time to jump over to all prices which certainly haven't been insignificant I've had a good rally of late I'm not sure how much stock we can put in this rally because you know a lot of it has been on speculation that we're going to get some sort of production freeze from from OPEC in a meeting that they've organized outside their typical schedule for next month and so obviously if OPEC were to freeze production even at near record levels you know that suggests that you know supply can't go any higher from OPEC US supply is coming down so the supply picture doesn't look as negative for oil and the free as you would imagine would be the first step towards a cut so that's the idea and you know markets have been ripping higher but where you can see that we're right around the 50% retracement of this of the dip that we had from the highs we're bumping into these highs that we had here from July this is the 50% level which corresponds to these lows and we're into the the 50-day moving average a few areas of resistance here so worth looking you know we're already starting to see a bit of a what could potentially end up being a shooting star pattern today so worth looking on the lower timeframes we've already kind of taken out this little bit here but even on these lower timeframes there's not really a decent low to pinpoint on the four-hour chart you can drop down to the one hour you can see we've taken out this low here and then we've tried to rally back above twice failed looks like we're taking out this short-term low here on the one-hour chart so we're a big significant resistance level on the long-term charts and there's some signs now on the short-term charts that we're starting to roll over you know it's going to be difficult to use a daily chart here at any point to you know really this this uptrend still in place you know while we're above this low down here if you're looking at high highs and lows so while this could end up being the top and we've got to be getting a bit of a short-term breakdown we really need another low to be put in and a failed swing to the top side and then a breakdown to get a kind of confirmation not from a longer-term perspective so a bit more patience need if you're looking for the daily chart confirmation but if you're just looking for a breakdown on the short-term against the long-term resistance with that's kind of happening right now I'll just move swiftly over to gold so gold really kind of consolidating at the moment you know this this has been a significant level for a while it was resistance along these closing levels here it's acted as support once twice almost a third time so if we did but we get a dip below one three thirty you know I think that's significant we'll get a possibly a drop down to one three ten would be the next obvious area of support should that give way but at the moment we've you know we're pretty much putting in a you know this is just a higher low you know that was the low we haven't been able to put any other lows up here then we put this low here and then we put in a high but that has you know that's been a lower high so you know higher low lower high not really a trend taking place you know we need these highs to get taken then these so again you know to be in a proper bullish scenario so that's about it that's the charts that's the you know the UK data obviously to look out still a few US earnings left had some GDP data from Japan from Japan suggesting I would say the big takeaway from that would be that global growth is is kind of slowing a bit in the second quarter and you know you you'd say that maybe the brexit uncertainty means that you know possibly there's not going to be a massive recovery in the third quarter too so sort of tepid global growth earnings coming down but central banks in there stepping up hence and stocks are still rising so I hope that helps good luck with trading this week and talk to you again same time next Monday Jasper Lord signing out