 20 seconds. Okay, traders. Welcome to this week's live market analysis session with me, Patrick Munnley. If you can hear me and you can see the tick me a welcome screen, just type Y in the chat box so I know we're online. Good stuff. Okay, so before we jump into the charts today, as always, we want to pay attention to the risk disclaimer. Most important really for today's discussion is that the views or analysis presented by me here today are solely my opinions or my views. They are not indicative or represented of those held by Tick Mill UK or Tick Mill Europe Limited. So for those that are here for the first time, brief introduction to me. After I graduated from university, I joined a city PLC consulting firm. After a couple of years learning the ropes, I left with some colleagues and went on to co-found and successfully exit a consulting startup post-emerger in late 2004. I then moved on to explore my passion for markets with some capital to play with and some time in my hands. I started day trading or more appropriately day gambling the S&P 500. After some early beginner's luck, I racked up some pretty solid gains. However, as is often the case, my beginner's luck ran out and as the market phase changed, I basically began to average down into losing positions, giving back all my gains and ultimately experiencing a significant six-figure financial hit. To say that was a gut wrenching and sobering experience is really an understatement. I had to stand back and figure out if it was really feasible for me to make a living from the market. So I decided to get serious about trading and sought out a mentor with an excellent trading truck record. Working with my mentor for 18 months, two years was a period in which I upped not just my technical game, researching and developing a strategy that suited my personality, extensively back and forward testing the strategy and developing a rigorous risk management approach to underpin that. But most importantly during this period of mentorship, I significantly developed my mental game. And probably the most important watershed shift for me was moving from being a highly goal-orientated individual focused on financial gains to really becoming purely process-orientated. So what does that mean? Well, it means I had to stop focusing on what I could make from the markets and I had to stop focusing solely on managing my mindset to allow me to consistently execute my trading strategy, oftentimes in the face of negative feedback from the markets in the form of losing trades. But once you become process-orientated and you have a professional trading mindset and you understand the true nature of trading being a numbers game in which you're simply playing the probabilities, you lose the emotional attachments and that hellish emotional rollercoaster of living and dying by the outcome of individual trades. I'm not concerned with the outcome of individual trades or even strings of trades. My focus is on the next 100 trades because I know if I focus on excellence and execution, my edge will demonstrate itself over an extended series of outcomes. My multi-strategy trading approach has delivered profitable annual returns since 2008. Since 2013, I've also been managing external investor capital through a managed account service and as you can see on the screen, delivering annual positive returns. I'm currently responsible for managing a multi-million dollar portfolio. Since 2010, I've also personally mentored over 100 private traders of all experience levels from complete novices to former CME floor traders in helping them to develop technical and mental skills to reach consistent returns from markets. I've also consulted to numerous brokers and trading education brands contributing written content, webinars and live presentation content on a range of topics from market analysis to trading strategy development and execution. In addition to my fund management and private mentoring, I'm also a resident market expert for Tick Mill providing daily market analysis and trade opportunities. You can access that through the Tick Mill blog and you can sign up to receive those notifications into your inbox. My other passion or passion project I should say is as head of trading and trader education for a leading trader education brand called FXcareerswap.com. At FXcareerswap, we're offering development and funding to retail trading talents. We don't just develop retail traders market and trading strategy knowledge. We work on mindset development through a structured program that culminates in the opportunity to manage the firm's capital at zero personal financial risk on a profit share basis. For those that are interested, you can see the contact information for the FXcareerswap there. There's a telephone number and an email. You can drop the guys an email and they'll be more than happy to provide further information if that's of interest to you. Without further ado, now you have an understanding of where I'm coming from, let's move into the charts. What I want to do this week is zoom out a little, I guess, and take stock of where we're up to by starting really looking at the weekly charts. What we're going to do here is we're going to start with the dollar index. This is a weekly perspective on the dollar index, and you can see obviously that from the high that we put in in 2016, we had a pullback from there and we retested or tried to retest those highs and we failed. That failure culminated in what we're currently experiencing now, which is an impulsive decline in the dollar index. I would note that whilst bearish the dollar index and certainly versus this structure here, so if we consider this to be an ABC correction, let's say at this stage in the dollar index, the equality objective for this move is down at 87.45. I would note that we are coming into a potential inflection point here where we have trend line support intersecting with the current down channel, and what I would expect is from this 90, 22 area or 90 area that we see an initial bounce to correct this initial decline that we're seeing, so we can complete an initial five wave down move here. I've been looking for a pullback then and a corrective phase to develop, but certainly whilst we trade below this 94.77, the ultimate objective for me for this move is the equality objective down to 87.42 area. This obviously then feeds into the perspective in terms of the euro dollar, so the euro dollar, if we scroll out here you can see we've been in this down, we have this descending trend line resistance from the 2008 highs in the euro, and we recently traded up to retest that trend line resistance and we actually got a break that we then got a pullback on consolidators and we're now extending higher in terms of the euro, and similar to that idea in terms of the dollar index, I think we're in the latter stages of this initial advance and what I've been looking for now would be a test of this trend line resistance which currently comes in around 122.71. Note we also have the yearly R3 pivot point coming in just before there, so 122.50 to 122.70, I would anticipate from there that we're going to see a corrective phase develop. Now in terms of what we can anticipate from a scale or scope for that move, well certainly if we get up into this area here, the initial objective would be a move back to retest the break point when we're broken high here at 120. My sense is that because of the scale of this move, this initial move will actually correct a bit lower and we could easily get back down into this ascending trend line support zone. Obviously it's a little bit difficult to track at the moment because we don't know for certain yet that we're going to top out here at this 122.50 area, but if we do certainly 120 and then maybe we see something like this, a three-wave corrective phase back into this 118.20-ish zone, the midpoint of the prior consolidation zone before we moved higher here, and what I've been looking for there is once we get that correction, then I think we set for the next leg higher, and that next leg higher should take us into the equality objective versus this swing here. So what we're looking for here is again an A, B, C move, which would take us the equality objective and the target for this initial target for this move is 128.60, and you'll also note that that coincides with this trend channel that we're forming here. So we've got the support zones, the two touches here, so we look for a touch on the upside into this 128 area. Now again from there then we'll see that that would be another decision point for the market and would broadly coincide obviously with the dollar index testing the 87 area. So those are going to be the two key inflection points for this move because what we'll either be doing is we'll either that will either complete a major corrective phase and then we move into a new advance for the dollar, or if we fail then to recover from this 87.40 area in the dollar index and the 128 corresponding area in the euro then we could be into a more significant decline in terms of the dollar, and if we scroll out here you can see the bigger trend channel support this from the all-time lows in the dollar doesn't come in then back until we get down into the 80 area. So if we fail to see a meaningful correction or advance from this 87.40 then that opens up much another leg lower in terms of the dollar index to certainly look at the 80 level, and we've also got the 161 extension of this structure here which brings us back down to the 77.78 area, and so let's think about what that means in terms of the euro, well if we don't take out this trend channel support once we test this 28 area then if we hold the trend channel as support then we can be trading meaningfully higher in terms of the euro because we don't really at that stage what we could do in terms of giving us some targets you can use this pitchfork tool and so if we connect this swing low this swing high and this swing low and we see we could easily advance up into this 145 area which would be the upper parallel of the channel there and we've got 142 as the the 161 extension so it's going to be these are going to be really key areas to focus on as we head into next year some pretty interesting inflection points ahead so it's good to take time and you know like I said at the beginning to basically zoom out so you can get perspective on where these bigger where the opportunity is going forward and certainly for the scope and scale of potential moves ahead let's check in with sterling so sterling is sitting at its trend channel resistance here now obviously with sterling we are we're waiting to see what happens with brexit the the sense is that we are you know that some sort of deal is going to be cobbled together here if we can get a close through this trend channel resistance in terms of sterling well then we can start thinking in terms of upside objectives and again what we do is we use the equality objective initially as our target so it whilst we hold 12650 as the key support area then the equality objective versus this move off the lows here would actually have us up at 147 we put us back into these prior structural areas here so more than achievable this 147 but what's going to be key is really getting that close through this trend through this trend channel obviously on the weekly chart here ideally what you want to see is two closes through that trend channel resistance really confirm that we have have the potential to move higher we've also got the idea of an inverse head and shoulders here developing in sterling you can see that we can easily this 145 147 would be my my upside targets if we can get if we can make a meaningful advance through this this trend channel resistance to check in with the dollar yen to the dollar yen being this down down sloping channel and really whilst we hold whilst we hold here this 11224 we can look in terms of downside objectives for the dollar yen versus this structure and what we can see here is that we could easily be down testing the major trend line support here and the equality objective so we have the equality objective coming in at 90 91 99 versus this 118 high and depending upon how we're trading we'd also have this trend channel or trend line support potentially coming in around 94 so we could have some meaningful downside objectives in in the dollar yen here and certainly like I say against this pivot here at the 112 then the pressure does remain to the downside in terms of in terms of dollar yen the Aussie so the Aussie is is looking to I think make a test of this this major trend line resistance here and what we're looking for now what we have if we can take out the prior highs here at this 74 area on a closing basis then we can start to think again in terms of equality objectives obviously we've had a very shallow pull back there at this 70 level but whilst we hold 70 as support then we have the potential to target and move to the 89 area being the equality objective now when you when you look at this you you know what typically as a as a technical pattern what you're looking for is a more defined corrective phase but I think what we've done here in terms of the Aussie is we've corrected in time not necessarily in price and so you know this thing can go can become impulsive now it may seem it may not seem feasible at this current time or from this current perspective but if we scroll left here and we look we look to what happened post the 2009 crash well in reality what we did was we did the same we have the same similar type of price pattern we didn't quite have the same trajectory trajectory to the upside initially but certainly if we start to think in terms of equality objectives well then we we more than got up into that 99 equality objective versus that 76 swing low so in terms of thinking thinking in terms of the market's ability to to achieve these targets and the and it's seeming you know not seeming possible when you're just looking at the chart as is well if you look to the left and you can see the scope and scale of prior moves and that can start you can sort of build that into your your your mental approach to the markets and and understand that there is certainly a scope so I mean the initial objective versus a 70 hole here is it's going to be the trend line coming at 8240 so there's plenty of upside potential here and I really you know are we going to go in a straight line like we did in in 0809 I don't know we could do based on based on the current current trajectory of recovery in the markets obviously everyone's focused on the vaccines but I mean if these vaccines do deliver then and we get Brexit out of the way and we get stimulus in the US and we start to get rid of some of the macro issues that we currently face then traditionally during periods of of less headline risk in the markets then the dollar has tended to tended to weaken now there are seasonal patterns that suggest January is a very strong month for the dollar December not so strong so it's it's not necessarily in terms of your day trading your daily activity in the market you know certainly not going to be a straight line but if you look at these bigger patterns then you can see what's what's possible ahead similar story in the Kiwi I mean the Kiwis are actually a bit stronger because Kiwi's already taken out its major trend line resistance it's checked back and found support of the 65 so whilst we hold 65 in the Kiwi we've got an upside objective at 78 currently trade 70 so another 800 per tire here and again it might you know when you're looking at the chart is this possible or you know can it be achieved well certainly again if we look at 2008 2009 Kiwi like the Aussie you know what it wasn't a straight line but it certainly was ultimately achieved and so um so you know there's plenty of trading to be done in the interim but what we're trying to do here what we're looking to do here today is just frame where the bigger upside objectives are and where the bigger inflection points are in terms of uh in terms of the markets loony similar pattern rates of dollar index looking for an equality objective versus versus this swing structure we just have we'd be back down trading 120 50s there and if you look again thinking about that 0809 if you look at the similarities in terms of price action that we've got in this structure here versus this structure here we can easily grind this out and get down to that 120 so thinking in terms of targets you know this this this is certainly a viable target in current trade 129 so again for another 800 or 900 bits of the downside so there's plenty plenty of scope there in terms of opportunity um euro sterling let's take a look at that obviously again um behest of the brexit outcome but um where I think we are at the moment versus the uh the current uh swing high so once we hold 92 99 then we have an equality objective at 87 we obviously have this major trend line coming in here so I mean the scope I think for us to trade down to 86 but once we hold 82 as support then we have the biggest upside target here of 105 which you know again seems seems you know that's a that's a pretty chunky upside objective but if we you know as we scroll out here you can see we're trading in this much bigger channel and 105 simply represents the top side of the channel so um so you know this is these if we do get a pullback here into the the trend channel support or the equality objective you know those are going to be certainly going to be interesting areas to to look at on the long side because there's plenty of scope in terms of euro sterling to the upside whilst we again what's important with these targets is the pivots and um you know the pivot here is 82 so once we hold whilst we're trading above 82 then that this 105 becomes the upside objective euro yen sitting on a major trend line we have third test pullback fourth test often gives way so if we can get a close here in euro yen through this through this trend line then I think we open up the major trend line resistance which which would currently come in around 131 we also have the equality objective versus this structure whilst we hold 121 60s of support we have a 134 45 on the upside there in terms of the equality objective so testing some key levels here in the euro yen if we can get a close this week through this trend channel resistance then I think we can start to make our way up towards 130 20s and through there we have the equality objective 134 45 sterling yen not quite we haven't broken out just yet we haven't even got to the trend line yet so I mean for me sterling yen we'd need to see a move through this trend line at 143 20s but versus this 132 support we'd have a target and the quality objective 151 but it's got a little bit of work to do yet but like I say we're only a Brexit headline away only Brexit headline away from this thing from this thing accelerating so keep in mind the targets there Aussie yen so again the Aussie yen is looking to take out its major trend line resistance here and if we can then the equality objective versus this move is up at the major trend line resistance 91 60s so plenty of scope in terms of upside potential for for the Aussie yen and so really want to pay attention to the ability for price to take out this trend line resistance because once we get through there pullback should be bought looking for this looking for this upside objective let's take a look at the S&P so the S&P we're sitting right at the at the potential broadening top pattern here in terms of the S&P let's just bring this in here and make this pattern a bit clearer so as I've talked about in previous sessions this 37 30 37 30 area is going to be key really if we fail here then I'm anticipating in the interim at least that we get a pullback to to the 3200 area if we fail there then I think we could be back down to 3100 but if we could if we see if we get a close above this 37 30 37 50 area a couple of clothes above there then I think we have to you know again the next upside objective is going to be 41 50s as crazy as it seems given the current economic situation for many people and the markets are obviously a discounting mechanism and if these vaccines are coming through then we can certainly see this thing extend pretty rapidly in terms of the the S&P there let's take a quick look at oil again if these markets are of the view that you know mobility is coming back and and travel then certainly crude oil starts to start to look attractive again and we can be back up and the quality objective of the 77 level repair attention to how we trade when we'd retest the underside of this channel at the 53 handle that could prove an area to pull back and retest these prize at the 40s as support but we can then start to think about the major trend line resistance at the 60s area en route to that 77 equality objective and gold here again chart looks we're in this bullish channel and and if we I'll take a look at gold on the daily chart a minute look at some in some of the daily patterns that we've got but certainly if we can hold here at this 1740 area then I think we can we can start to move harder and look at 2100 to the upside and through there then we've got much much higher 2450s in terms of upside in gold and so those are basically what I want to do there that the purpose of that exercise is just to give you this sense of being able to or take the time really certainly you know the weekends to to basically get off your trading time frame so whatever time frame it is you trade to zoom out so you know I don't know if you're trading the hourly charts for example then you know getting on to the the weekly or the monthly charts is going to be really useful for you in terms of giving you perspective in terms of scope and scale of what's possible in the markets so let's just quickly now take a look at some of the daily setups that I'm tracking in terms of in terms of getting into potential trading opportunities I see the dollar index is testing now into this support area this 9050 and what I'm looking for essentially now will be a bounce here to get us back up into these this prior support this pivotal support 9170s from there I still look for a fifth wave pattern to complete into this 90 area as as I talked about and then from there I think we could see we could see a corrective phase in terms of the dollar index so if we get a bounce here we've got the Fed and the ECB up next week so it's more than like we can easily see some profit taking here but I still anticipate heading into the back end of a bit of the year that we see this wave 590 level tested and then I think as we head into to January looking at the seasonals we could certainly see a corrective phase in terms of the in terms of the dollar index so similarly with the euro I'm looking for this wave 3 advance to complete we've got the weekly R3 coming in 2180s let's see how the euro responds here but any pullbacks that hold 120 are buying opportunities to trade for this major this trend line resistance the initial one here in terms of the daily time frame coming at those late 122s and then from there like I said I think we can see a corrective phase develop in terms of the euro sterling looking for it to retest these prior highs at 13480s I think we can see a pullback from there but you know if like I say one Brexit headline away from from seeing a pretty sharp advance here but what I would suggest is that we are in this wave 5 zone now so any advance I think up into this target zone of 139 we'll see profit taking and traders looking at the by the rumor sell the fact type set up so caution as we trade into that 139 area will be what I suggest don again looking for lower now looking to basically break this trend line support here at the 10340 area en route to a retest of year to date lows at 101 again we can bounce from there and set up a wave 4 into the wave 5 objective versus this structure here down at the psychological 100 level the Aussie again looking for we just testing or just about to breach the prior high so I'm looking for us to get up into this 127 extension 75 20 area but project projected weekly range resistance coming in at 75 from there I think we can see a pullback back into this 73 area and whilst we whilst we find support there then we target the fifth wave opportunity into the 77 level swissie is is just shy of testing this descending wedge trend line support here third test I've been looking to opportunities to get long here you can get onto the intraday charts watch how we trade at this 8895 area I think we can this could be the area where we see certainly a bounce in terms of the swissie get us back into the 90 handle and then we might have to take it one more leg lower here before seeing a more meaningful correction develop it like like I say really probably looking at the end of this month into into January before this plays out but certainly I see a tactical opportunity in terms of the swissie here on on the long side loony again whilst we hold this 134 area we're looking initially for a 126 as the interim wave five downside objective so any bounces back into this 132 I think are our opportunities to get in on the short side and look for this 126 key win grinding it out to the upside versus this potential way for low here at 65 we have a wave five equality objective coming at this 71 handle we're currently trading 77 six so again I'd be very interested how we respond when we get into this area we could see a pullback from there to retest the quality objective versus this initial swing here so let's just track that and then we could be looking so from the 71 level can look for a pullback to the 69 30s we probably retest that high and then and then we see a more tradable pullback back into these prior highs as range resistance to active support at the 68 handle and then from there I think we can look at long setups gold I'm looking for a 1740 test so I still any any move at this stage let me just draw this in for you so if we come in here back into this 1850 I still think we complete a pattern a cycle down into this 1740 equality objective before we can before then I think we can really take off to the upside in terms of gold last but not least S&P 500 let's see how we trade at 3730 we've got a bunch of confluence there we've got the weekly or sorry monthly R3 weekly R3 coming in at 3788 so let's see I'm certainly going to be paying attention to the price action when we get into this area because I think from there we could see certainly a tradable pullback in terms of the S&P and that really wraps up wraps up the charts for me this week guys so are there any questions and in the chat box if there aren't so basically the takeaway for me at this stage is I'm looking for the dollar to post an interim low here and and play a correction before we before we then move into the wave five completion at this 90 level and that obviously then feeds into my view on the on the majors here good stuff okay thanks very much for your time guys hope this helps and we'll reconfine at the same time next week thanks very much