 Let's get started with this week's weekly charting analysis webinar. Definitely going to be an interesting week. Got the end of quantitative easing. The stimulus program from the Fed that's pretty much propped up stock markets this last couple of years. So that's pretty big. Before we get to that, though, I've got the risk warning on the screen. Well, maybe you've all read that first page. Let's shoot through to the next one. Well, it's a bit of an aside. So let's just start with it just because I did a bit more of a sort of exaggerated chart picture than I typically would, but Twitter report earnings after the close of U.S. markets today. So even if you're not trading individual stocks, you know, this is always, well, not always, but the last couple of reports, earnings reports for Twitter have been pretty volatile. And so I thought it worth just putting a chart foreign post up there. And according to the chart, you know, we are potentially a bit of a turning point with Twitter. So what you can see here is that this is a daily chart. And so we're trending higher. The 50-day moving average, if I scroll out a bit, you can see has been quite instructive. In terms of the general direction of the trend, you can see we've sort of come back, break out of it, on that stronger up movement, come down, retest, and we've been higher above. And now we're grinding into it again. So that's not to say we're going to definitely go below it, but there are a couple of indications we could. One is this bearish divergence in the RSI. And the other is the fact that we've made a lower low. So if you consider that the first low, you know, and the other is the fact that we've made a lower low. So if you consider that the first low, I wouldn't typically classify this as a low, because I mean it's to their own in terms of how you do call a low and maybe you don't even consider highs and lows important. I think they're essential. So there's two higher closes on that side. But on this side, only one. So to me that's not quite a low. So even though it proved to be quite instructive of what was to happen next, to me this is the big one, because you've got plenty of highs and lows on either side. It was a longer term, more significant low point. We've moved beyond there. And you could actually consider this a high at this point, because it's had two days either side. So a lower low and a lower high. So, you know, technically that's a downtrend, but it's not always as easy as that. What we'd be looking to move down there would be the big confirmation. And that would also obviously be below the rising trend line. And then we get into the territory of this gap, which often acts as a support. So that whole zone would potentially be support. But given that we've closed that much before, I wouldn't be unduly surprised if we went and dropped down to the beginning of that gap and just closed that whole gap. And that would be a change in trend. And we could even be pushing down below 30. It depends how bad it is for Twitter. Of course, it may not be bad at all. The last report was actually quite good. And it's just been sold off a bit recently, just because of a general set off in some of the more high valuation stocks going into this earnings season. So always hard to know exactly what the earnings will be, whether it will be a beat or a miss. But here's the technical set up, so definitely worth considering. Now back to markets as a whole. I'm going to go straight to the German DAX, just because the big data that we've seen so far today was the German IFO. So that's just a business sentiment or report that's pretty widely watched. And there was some hope that after, I believe, six months, no, five months of declines, there was some hope that actually would see a bit of an uptick this month. And that's not happened. It actually is the same in terms of future expectations, which is kind of the key one to one, because you obviously want to know what's going to happen in the future, not what people think about the current environment, but what they think about the future is key, particularly in terms of businesses and whether they're going to invest in some future projects. So that was actually just the same as last month, which is obviously not a decline, so that's good. But the rest of the report was a decline, and it still missed expectations. And so that has essentially undone the sort of positive feeling that came out of these European Bank stress tests that came out over the weekend. Basically 25 banks out of 130 failed these stress tests, but only a handle of those actually need to raise capital in order to shore up their balance sheets to a sufficient standard to actually then pass the test. Why is that important? Well, the European Central Bank have been trying to stimulate the European economy, because there's been low price inflation. And one of the recent measures they did was this TL-TRO program, and silly name, but all it is, is just the offering of sort of cheaper interest rate loans to banks to then hand out to businesses. Specifically, the money has to go to lending towards the business to obviously stimulate the European economy, which has been in a rough state since the European debt crisis. And so the thought here is that maybe now that these bank stress tests is out of the way, banks don't have to worry about having sufficient money on their balance sheets. They passed the test, so now they can make some more loans again. And so this may be the turning point for when the European economy can pick up with banks now feeling much more able to hand out loans. And so then conversely, if the European economy does pick up, then there wouldn't be any need for the ECB to do full-on quantitative easing, and that would potentially be not such a good thing for stock markets. But I would argue perhaps a good thing for the euro. The euro's been declining pretty massively since they hit 140, and if massive amounts of euros are not going to be printed in a quantitative easing program, that would be kind of supportive of the euro. But as I mentioned, the Fed is the US Federal Reserve. The central bank there is ending its quantitative easing program this month, and markets are looking for someone to take the baton. And maybe that's not going to be the ECB if their current programs, this TL, TRO program works. So that's the possible implications of all this. There is a distinct possibility that it makes no difference. There are a lot of people out there, almost myself included. I think maybe just more of the issue is just a lack of demand in the European economy. So a demand for loans. So if it's just a really weak business environment, the business is struggling, you're not going to take on a loan because you're feeling so confident. You're actually not feeling confident. You don't want a loan. So just the fact that banks feel more capable of making loans doesn't mean that people actually are going to want to take them up. So that's what we're going to be monitoring in the months to come. So when the next set of take-up from this TL, TRO, that would be important given that this bank stress test is now out of the way. Technically, with the DAX, I can see it a bit better on the weekly chart. I've mentioned this a few times now. This is the sort of head and shoulders formation. So this would be the sort of double-ish left shoulder. Triple even. This would be the head. This would be the right shoulder. You could also call it a triple top. I would say more accurately a head and shoulders. So it's broken the neckline. So you can either use that as a neckline, which would be the two lows, which do correspond pretty well, or kind of closing prices. And I would close weekly prices. And so that proved to be perhaps a bit more instructive. And so that's where we are now. It's not necessarily a big coincidence. I had this line drawn in weeks ago. That's where we're reversing at the moment. And it's right around this 90-50 mark. So what we could have seen here, technically, is a pattern breakout, a retest of the breakout area, the neckline of the head and shoulders pattern, to subsequently make the next move down. So that's something to bear in mind. And that would put us, these are the low down here, I believe it's sort of about 7-7-50 or something, I believe is about the projection. What you do is take the height of the head from the breakout area, perhaps this, the 90-50 mark, and project that downwards. So definitely an important price level right now. If this pattern does prove to be work out, this would be pretty, if this was a retest here and then moves down, obviously this would be a great place to be selling. But I only know that with the benefit of hindsight. This could be the end of the correction. This is about 10% from the highs. So a lot of people have that 10% number of Gallup in mind. This could be the end of the correction, only for us to make up new highs. A lot of that could depend, maybe not even on German domestic conditions, but more just the overall international stock markets and how things pan out with U.S. corporate earnings and the end of quantitative easing. So with that in mind, let's have a look at the U.S. 30. This is here, looks very similar. So on the weekly chart you can see this longer-term trend line that I've got here, going way back since the bottom of the financial crisis in March 2009, connecting these lows here. And so you can see we're well above that. So even if we did make a new low, which we haven't quite done yet, we'd still have the support potentially of that rising trend line. So it's still pretty constructive on the U.S. stock market. And obviously we've not even made a low-low on the weekly chart yet. This level is, you know, you can see we've bounced off there pretty nicely. So then it's a matter of, well, are we going to go down perhaps challenge this line here and the longer-term rising trend line? Well then we need to sort of look at the daily chart for that. This is what you call the sort of the bottom potentially. If it is in fact the bottom, it's been a very sharp move down and a very sharp move back up again. So definitely great market for trading, a lot of big price movement. So what I'm kind of weighing up here is the fact that in terms of highs and lows, you know, this was really the last high that was formed. It's way up here. So still theoretically anywhere below there we could still roll over and still be in the context of a downtrend. So if that was the last high, this was the last low, none of these really on a kind of daily basis classifies lows in terms of that definition that I previously used to higher-closer these aside. So this would be a consideration because this is, you know, you can see we kind of broke through there. We had these kind of two lows there. That could be big. I'm also looking at this big spike here. It's kind of proved constructive in the past and kind of matches these lows and this high-ish on the past. This zone is tricky and we've had such a big strong move up. You've got to feel that we would correct somehow at some point. So what we're either going to see here is maybe a correction lower down here and then a further bounce up again or just that's the end of it and we're down again to potentially test that long-term trend line. For short-term trading, you know, we're in an uptrend. We've got to be a bit wary of this movement from today. It's harder to see the levels on the U.S. 30 but obviously looking at that, Germany 30 chart, that level is a bit more significant and we're seeing a sort of similar reversal on this four-hour chart there. So potentially the beginning and the end for this correction. But as of the moment, we're still above the 50 on this four-hour chart and we're still above the 21 period MA. So default is you've got to assume we're trending higher but you've got to be aware of this longer-term picture. Actually, technically, we're still going down. So when thinking about the U.S. 30, the U.S. SVX, the U.S. NDAQ 100 and any of the dollar currency pairs, definitely and in fact gold, we've got to think about the U.S. Fed this month and on Wednesday the Fed is expected to end their quantitative easing program by cutting the last $15 billion that they pump in each month from the QE program and ending it. So that's a certain amount of liquidity that's been provided to in the market. It's used to that amount of liquidity. When you've got a big buyer in the market buying up treasuries and mortgage-backed securities, it's supportive of risk-taking in general. If you've got a big buyer like that, people just tend to be on the side of buying rather than selling. So when that ends, it's going to be down to the economy and the stock market to hold up on its own and it's pretty highly valued right now so there's a distinct risk that it won't be able to. A good measure for how this report on Wednesday gets, this judge will be gold, can have a look at that chart in a second. But just in terms of what to look out for in this report, they're almost definitely going to taper the $15 billion. They may not. If they don't, that would be, I would think, pretty supportive of the stock market and also pretty supportive of gold. The more gold did really well in the years leading up to and during the first part of the quantitative easing program. But when it looked like it was going to be starting to kind of tape it off, that's when gold just couldn't get up beyond that $2,000 per ounce mark and we're in this kind of correction phase now. So almost definitely going to taper and that would be theoretically bad for gold just because they're getting closer to raising interest rates and sort of going, you know, there's not going to be that much risk of sort of a hyperinflation in which you would need gold as a protection if they're just raising rates which generally acts to curb inflation. What they could do is change the statement. There's a big statement in there which references a considerable period of time referencing when they're going to hike rates next. So if they change that to indicate that they may hike rates sooner, then that would probably be pretty bad for stock markets and also pretty bad for gold. So that would be certainly something to watch out for. The general assumption I think out there though is that they won't be changing the statement. Really all they're going to do is NQE. So it's not really to rock the boat too much with all too much in one meeting. Next month could be one in which they change the statement. But I think they're trying to kind of anchor interest rate expectations. Not worry the markets too much. Just say it's going to be the middle of next year by the time we raise rates. But while we're on the gold chart, let's have a look at it. So you can see on that longer-term chart we hit that 1180 for the third time. We bounced off there pretty strongly but we've now broken through this rising trend line on the four-hour chart and these two blue lines just correlate to the recent highs and lows as I judged them on the daily chart. So we've broken the rising trend line on the short-term but we've not broken below this low here. And we're just in a really tight range because gold is very sensitive to the Fed and interest rate expectations. So a move below there doesn't bode well. We could be in for another test of 1180. If we drop below this blue line here which corresponds to the kind of most recent low. But we're above the low at the moment and we have made a high high just about. So even though we've broken this short-term trend line still the general assumption would be that gold can hold above and at least retest the high again, perhaps make a new high. Just with the idea that trends tend to last longer than you expect. But while we're on the commodities space let's have a look at oil. So it's been a pretty huge market of late in terms of the direction of trend. For those of you who've been trading a while, you've been loving it. For those of you who've been new to trading perhaps you've missed some of this trend but this really is great trading when you have such a sharp trend like this because what are your decisions on a trade? You have to decide what market to trade. Decide what direction you're going to trade in that market. Obviously with CMC markets you can trade long or short. And then exactly where to time your trade is obviously key. That second element is often overlooked in terms of just actually picking the right direction. Your timing doesn't have to be that great if you get the right direction and you put your stops in the right places. You can sort of improve how much risk you're taking each time. If this was the downtrend in crude the benefit of hindsight we're looking for a continuation of the downtrend. If you place your trade up here short and you had your stop above the previous high you're taking a very small amount of risk selling up here. And the benefit of hindsight that would have worked out beautifully. But if as long as you got the direction right you could have sold down here. Yeah, you would have been sweating when it was bouncing up here. But as long as you had your stop above the previous high which is the definition of the downtrend that would make it lower lows, lower highs you'd still eventually be good. So can't overestimate how important it is to have a nice strong trend and that's what we've got in oil right now. Obviously you've got to be cognizant of when it could end. And we've just in WTI we've just hit 80. And so the dynamics in the oil market right now are mostly centered around global supply and demand not so much global geopolitics that's just really being discounted at the moment because nothing's massively disrupting oil production in Iraq and Syria and Libya. Nothing actually is halting oil production right now the same with Russia. They're threatening to not distribute natural gas or they're not giving Ukraine any natural gas at the moment and that's a bit of a sort of political turbulent situation at the moment but in terms of oil that's not so much a factor it's just the fact that the global economy seems to be slowing a bit particularly coming from Germany and China China especially is obviously a massive consumer of commodities and it's slowing a bit and the US is now producing lots of oil. So there's a lot more oil out there and potentially less people wanting it so the prices have been crashing down but as I said we've hit this key 80 level so then you can see better one of my daily chart now on a four hour chart you can see we're in this kind of range really on WTI it's 80's key but it's about 8070 to this 8390 but really we're talking about 84 and then in Brent it's really the same thing but it's 83 to 87 is the range. So we're in the sideways market right now we're hitting the bottom of the range depending on your trading style this potentially is a there's a bear flag and we potentially broken out excuse me so yeah as of this panel we've broken out if you're trading that that bear flag so we could be in for new lows and just based on that idea again that the trend is down you know we really want to be trying to trade with the direction of the trend but we've just got to be aware of the potential for it to reverse 80 is a big round number and it could still hold and I think the thing that could make it hold is what OPEC does namely Saudi Arabia they've been cutting prices to their supplies to Asia sort of but they did apparently in September cut the amount that was supplied to the market so they produced the same but they cut the amount of oil they supplied to the market in an attempt to obviously that same discussion be less supply on the market to match that less demand and push prices back up because obviously as an oil producer they buy higher oil prices because they make more money so the next OPEC meetings in November so that if they actually do cut production or some of the other OPEC countries start to at least cut supply to the market that could be a changing dynamic as of now we're still talking about higher supply than higher demand and the trend is down we're hitting the bottom of the range now so if you're a breakout trader you'd be ironing up this area and waiting for corrections we're obviously right at the low right now so not optimum in terms of a bounce for selling now let's get into the currencies Pound is interesting right now this is a daily chart what I'm looking at here is kind of a wedge with bullish RSI divergence so I'm sure a lot of you are familiar but for those who aren't price making lower lows you see an indicator momentum indicator like the RSI making higher lows shows the prices still turning down but it's just got less momentum behind it so this 50 level when you're using the RSI with the period 14 and well any period really but particularly with the 14 is deemed significant if you're above if you're below there and we're kind of roughly we're sort of bouncing around uptrending it mostly above it here we've been below it for this period and obviously that was a down trend as well so it's just an extra indication to judge which way to be trading and we've tested off there, it would look like maybe we're going for another test to potentially move through and that would correspond with the top of this wedge and this declining trend line and we've got this divergence going on so the trend is not reversed yet but we could be in the midst of a higher low we've not seen a higher high yet so I've got my line drawn lower actually only to update it, there is the line in the sand now short term I don't think that changes the picture too much you can just see it in a bit more detail it's kind of a choppy market in the short term you need this at the moment daily chart is a clear one for the pound for me Euro similar situation Euro is obviously tanks but we've hit 125 the round number we've gone up hit 129 where we have this last period of consolidation obviously that was a low at that area no coincidence that we banged into that we'll come back down and we're in a kind of a range trading situation and these blue lines that I've got on the chart see a bit on the four hour chart there you can see it corresponds to the highs and lows on the daily chart and you can see it in a bit more detail in the short term chart we're in a range trade right now so with a benefit hindsight obviously buying off these low at the bottom of the range is good we've come off the round number around 127 theoretically we're going sideways in the short term we've broken through this slight rising area but probably ahead of the FOMC on Wednesday we're not going to get any Godgantuan moves in dollar pairs dollar yen near in the end of the session here so any questions at all put it through the chat window and I'll get to that after the official webinar time so for those of you who are following the chart forum there's inverse head and shoulders that I pointed to not quite made the target area yet we're in this kind of consolidation period again ahead of the Fed we've got quite a bit of data out of Japan as well this week we've got the Bank of Japan rate setting meetings that will also be of some influence so we're not quite at the objective yet for this pattern if it is to play out we did break out but the question is if we break out of this pattern based on this pattern here but obviously if we break below the bottom of this range we're heading back down to the neckline again which would stretch out over here down to this 107 mark and also matches along with this consolidation area there below there probably coming into this area but still looks like a continuation pattern to me where you have more like a kind of bull flag there's the pole there's the rectangle up to 110 again but remains to be seen if in fact that plays out okay I'm going to just stop the recording here so any of those who at the end of their lunch break thanks a lot for attending again there will be a recording of this on YouTube should you want to check back or obviously feel free to share it for those of you who want to stick around we've got a quick question here that I'm going to answer from the chat window