 Okay, welcome everybody to this week's CMC Markets Weekly Charting Analysis webinar. My name's Jasper Lawler, I'm hosting today. We're just going to zip through this risk warning that you see on the screen here. Okay, well last week was literally one of the maddest markets I've seen in a while. There was some serious volatility going on and I hope some of you are able to participate there because there were some big movements we saw. You don't see that kind of thing every week, particularly in the currencies and I think going into this week it's going to be currencies that are going to be the focus again. It's hard to imagine that kind of volatility if it can be repeated but there's been a lot of cause for the closer we get to the FMC, the Federal Reserve, the tightening interest rates, the more volatility we're going to see in markets just because they've had such an impact on asset prices since they began their QE program. The first stage hiking rates, second possible stage of selling off some of their treasury holdings or mortgage backed securities is going to have a pretty massive impact on markets and that's why we saw the likes of, if we just jump over to the old Euro chart here, why we saw this take place. This is the daily chart and you can see, started down here, sub 106 got as high up here as over 110. It was close to a 500-pip daily range and that's just the daily chart. If you look in today you can see how crazy it was there and then not only that but then the next day, pretty much retraced almost all the gains down to the sort of breakout area here. You can see if I draw this line in on the Euro chart. This is where we bust up, broke through, closed there and then the next day just rally straight up to those peaks again and at the moment it looks like we're pushing up and making gains and that's been my feeling as posted in the chart forum here over the past few days that we see something like that. We're a bit of a long tail there so understand a bit of a dip but if people are going to be, even though I think most people's outlook is still fairly dollar bullish, Euro weakness given the divergence and monetary policies, when you see a move like that, that shakes a lot of people out of their positions and so unsurprising that we haven't even seen a test of the lows again and we could see this is my line in the sand which we've basically already kind of touched so that's probably not much of a marker here and I'd say we're pushing maybe further up towards this 113 mark could be where this is headed. You're still sort of going against the longer term trend here. You remind ourselves, you look at this weekly chart, not exactly a friendly place for bulls but nonetheless I actually posted this chart a while ago. Actually now I've got the line altered on this chart for some reason but actually connect these two lows. Look at that. That's not far off. All long wicks coming off this trend line so you know there's a possibility here we're certainly still in a downtrend but we've seen a sharp reversal, did correspond with that trend line. We actually pushed through this low back over here but nonetheless if you look at the size of these declines historically we're through that and so chance of a turnaround here but at the moment we've got to be a bit cautious because really this trend is still down. This is kind of the lower low, lower high, lower low so by default we're expecting another lower high somewhere before that high to eventually roll over again if this trend is to continue but some indications based on the volatility around the bottom here that maybe we went and for those unaware basically the reason for this jump around in prices at the tail end of last week and so we're looking at the Euro chart here but may as well look at the pound as well because it was pretty similar, pretty massive. Nice false break on cable on retrospect because you have this low here, false break lower a lot of people with fell stops underneath the low, pushed down but then ended up closing above and obviously just rocketed all the way up so hopefully some were able to benefit on breakouts above here for example pushing up to these highs but even if you weren't there was a couple of opportunities post that to get in close to these lows again in the anticipation that there is going to be some follow through on this massive false breakout. What was the cause? Really the Fed meeting last week. The FMC were just a lot more dovish than expected. They did take out the patient's language as most people had foretold but the big change up as we had actually highlighted in our commentary was a distinct possibility was that they actually scaled back their growth and inflation forecasts and kind of put back the dots on their dot chart implying where they think interest rates will be at certain periods in the future so sort of scaling back their interpretation of the economy that was interpreted as dovish and that's why we saw these massive moves in and around markets. So what to look for this week? Tomorrow is going to be pretty big particularly for this pair that we've got on the screen. We've got both UK and US CPI data out coming out tomorrow. Obviously that's a pretty good day for comparing the outlooks for the British pound of the US dollar. The dollar is the world reserve currency so that tends to be the more dominating force but nonetheless if we see some clear cut difference here where inflation is improving in the US because it's not in the UK or at a faster pace in the US than it is in the UK then we can expect this general down climb to continue but I think it probably would take quite a divergence of data to undo some of the large moves that we've seen here and I think we are likely going to at least push up to this towards this spike high again just to kind of test the determination of bulls and bears up at that key level that caused the big reversal back down here so obviously this was massive because it caused that reversal up here but equally this was massive because it caused the reversal right back down again so that was just the remarkable thing about what happened and again this level kind of proved important and you know this is the line of the sand down here at the moment this 147.4 so it looks like it's holding pretty well and so you'd imagine the next kind of key test even though we've got these loads over here which are kind of preventing the moves high at the moment I think really this is the big one and so CPI data will be key there's quite a lot of US data this week so we've got durable goods following on Wednesday and then fourth quarter GDP on Friday I think is that the could be the final revision final revision yes that's right so actually expected to be provided slightly higher so that will not really you know so one thing to kind of look for here is how does the inflation and growth compare with what the Fed are forecasting because that's quite a favorable situation for US stocks and if we flip over to the US 30 for example you can see that we've this is the weekly chart which I think is quite instructive at the moment we've got this you know this is kind of my highlighted breakout and looking at ever since we're up here didn't get through there and then we've formed a bullish engulfing candlestick where this body is engulfed this body of this you know the low hasn't been engulfed but the body has so that's the definition needed by the Japanese it's not an outside week as defined in Western bar graph techniques but it is a bullish engulfing according to West according to Japanese so quite a strong pattern either way and you know that's you know this situation where the Fed are forecasting something quite dovish and so they're keeping interest rates low but actually the real in date the real data is showing a better better than forecast so for the time being that would be a positive because the economy is doing well but the Fed are responding with kind of dovish policy eventually if the data continues to improve then I think that's going to be a negative for markets because the Fed may have to adjust their commentary and shift it to be a bit more hawkish and maybe start leaning towards a rate hike in June or September but very simply you know a rate hike is not too positive for stocks obviously it looks like it's on the cards it was still pushing into all-time highs so it's not been devastating yet but it's mostly the cause of these sell-offs is when it looks like that rate hike is getting closer than previously thought so if we do while we are on the let's stick with indices while we're on the US 30 if we got down to the daily chart so you saw we had that bullish engulfing you know that quite something that encompasses all of these moves up here on the weekly candle but at the moment we've just bounced off this just shy about 18197 was the peak but at this basically bouncing off this 18200 round number just shy of the all-time highs here we'll forward it in March and obviously that next round number target is just above which is what we fell down from before at 1800 so not surprising to get a bit of a pullback from there in combination with these peaks I think for the sort of bullish outlook to be maintained this is the previous swing high now we have kind of already tested that so that's what makes that potentially not as strong because we didn't just push way above that and come back to it which is the ideal for this previous high acting as then support so that will be the first consideration but I think given that we've already busted through it there is a possibility that we could drop down to this low here and then maybe a false break below and then push up again but if that bullish engulfing pattern is to hold any weight then I think that would probably be a level that we need to hold also something I occasionally look for on the RSI here because I've got an inverse head and shoulders pattern something I mentioned on the chart forum prior to this big break higher sometimes when the reversal and the prices doesn't look too clear they look on the RSI and suddenly actually there was quite a nice little inverse head and shoulders which we've got a break above on this candle and then we had to pull back on this candle we held above the low we've got this big spike down here and then pushed all the way up and this obviously was the same day when US stocks all that massive volatility on Wednesday was obviously the same fed day that caused that volatility in the US dollar I guess an index that we're all interested particularly here in the UK is the UK 100 as we trade it as you can see we're above the 7000 mark we closed above there for the week and for Friday last week and that makes marks quite a game changer noted in the chart forum today that we do have this rising trend line connecting these two peaks it's not generally rising trend lines connecting peaks are not as significant particularly if we are seeing a trend acceleration here it would just be a good indication once we break through it that we are getting that acceleration at the moment we're pulling off it a bit there hasn't even lasted too long we're already bouncing back a bit off of this peak here so harder to see when we've got a strong trend of the daily chart but maybe if we drop down to a 4-hour chart you can see this was the kind of like high-high, high-low, high-high and then dropping down towards that and you can see that high that's what we've bounced off here I've got my line down here you know it's just a bit more conservative but we're getting a strong bounce off here again sometimes lines on the RSI can be instructive so you can see that we've got a few touches on this rising trend line and we've got a breakout here so that just adds a bit of extra weight to this move above 7000 if this trend line does prove to be significant there may be a retouch of this trend line before pushing higher but it's like another place to get in along the market in terms of UK data I mentioned the CPI we also have retail sales on Thursday retail sales have been fairly decent actually in the UK somewhat supported by the by lower oil prices but what's been holding UK markets back a little bit is actually we looked at that chart the British pound against the dollar we thought the pound game pounded actually a bunch against the weighted basket of currencies the British pound's been pretty strong and that's actually been hurting exports a little bit and it's kind of been impacting the economy in general and holding it back a little bit but you know should you know should there be a reversal of fortunes and the euro push higher a bit that actually gives some scope for euro pound to push higher a bit and we've actually already seen some evidence of that so quite a strong looking reversal in euro pound helps UK exporters a bit and that has somewhat corresponded with this break above 7000 let me just show you that euro pound chart so you can see here that we got that bullish and golfing again off the low then we got a so that was the that was the breakout area got a push above a test pushed above here broke above that peak so now suddenly the downtrend's losing strength a bit we're turning into a bit of an uptrend push above this again Wednesday at what large ranging day and pushed up into the high up here pull back test of that previous high again so this is all characteristic of an uptrend high high high low without even dropping close to the lows it's just coming off the peaks which is the sign of a strong trend as continuing at the moment we had been closing below this low for March 2nd but it looks like today we're pushing above and if we do get a close above this high up here you know that's definitely a major progress in terms of the year the pounds losing some of its strength against this weighted basket occurrences which should be good for UK economy and you know what's going to be the economy should pass through to the consumer and be good for retail sales we're not quite there yet but this is something to keep in mind for those following individual stocks big one is that we've got easy jet earnings on Thursday another one to note is that flipping back around well let's watch the video a quick look at the Germany 30 because that really has been the strongest performing dollar market index this year if we just take a time to look at the extent of this rally it's been quite huge you know this was obviously the consolidation area that we'd be dealing with for a while and then as QE was announced in January or the expectation was that it would be announced boom it's gone up to two handles basically picking it around 12,000 and 11,000 didn't really make much of a dent but this has been a really strong rally and we've got up past 12,000 we actually hit 12,220 I believe so we're getting a pullback from this 12,000 level which you know a bit of an indecisive candlestick here with basically sort of spinning top side pattern so not giving us too much of a clue either way but wouldn't be surprising if we've got a bit of a dip down maybe to the lows of these candlesticks I've got some lines drawn in here based on the daily chart and so this is a sort of interim low which has actually been kind of holding okay you can see this range of these candlesticks kind of in what's been supporting us and we've got to push up we didn't even get as far as 12,100 and we've actually rolled over since they're still holding for now but I wouldn't be surprised if we've got a dip down to a retest to the 21 day moving average and these peaks from back in early bottom arch you know this day has not closed yet so don't fall for that mistake where you think this is a done deal because the candlestick looks as it is right now but in the day that could be a tall wick and we could be have a long green body up here with a higher close but you know if the day does close like this and it's a bit weak then that might be the first stage towards this move down here also look at the RSI again you can see our kind of equivalent rising trend line we do have one for price that works quite well I think something along those lines that's not broken yet and again that's maybe we get a kind of what would be quite a nice pattern would be if it spiked down these peaks and then closed above the line again that could be a good indication to get along the market again but the fact that this rising trend line has been broken from the RSI suggests that we could have a move down to there and should we get a close below this line and the 21 is quite a confluence of support there if we do get a close below that then we could be looking at a move lower and we'll have to look for more opportunities along the market down here I've got a quick I'm going to switch back to currencies now I've got a request for Pound Swiss I thought that was on my watchlist here but I think I took it out let me just load that up now this term Pound Swiss looks I haven't actually looked at this for a while but it looks pretty similar to the Dollar Swiss chart what we basically have this if we look at the weekly chart can see it better kind of support going through here this is where we were bouncing off bouncing bouncing and and now we've spiked through there followed through so yeah it looks pretty similar to the Dollar Swiss chart and I did mention I think last week on the Dollar Swiss chart let me just see if I can pull that up can see that's probably pretty similar even more extreme rebound here and did I actually end up putting that down for him no I did not I think maybe I tweeted it but yeah you can see that Pound's a bit more correlated with Euro so you know it's more kind of flat around the peg the Dollar was just moving higher in spite of that peg you can see that's where we crashed we've moved up to this kind of breakdown area so yeah definitely an opportunity here we've already moved down a bit but plenty of room to the downside I don't quite know how I would I mean we've let's move back to the pound again since that's what the question was on did I keep that chart I didn't yeah so I think that weekly chart is the instructive one you have to be careful in these situations about nothing you know don't sell out the lows and pull back but certainly if we kind of bounce not certainly but a possibility if we bounce back to here where we broke down there that would certainly be an opportunity but you know we may not ever get there so that's the risk if you do feel you know I'm not quite sure what the inclination is here Mark the way I'm looking at this is this is a possible point in which we roll over the market lower I don't I don't necessarily see this as a by the dip scenario in the long term we definitely could get a push higher back up to this breakout area but I would you know I'd be pretty wary of this market hope that helps we have had the the SMB saying recently that there is going to be no new floor put in the market no new peg probably pretty bullish the Swiss franc I've got about five minutes left here so let's shift on over to commodities for me one I've just been really following up recently is copper one of the bigger movers today got a nice old follow through on Friday so again quite a lot going on in this chart let's table what we're going to see here this is the weekly chart this was where we made that big spike and then big reversal so this was our first clue that maybe there's some buying interest in around this 250 level obviously that's a big round number as well 245 ended up being about the low so we pushed down again as again it was a sort of false break scenario and then we ended up with this kind of spinning top doji looking week followed through and that was the kind of break there according to me of this kind of downtrend type scenario you can see that kind of area did hold we pushed up quite high got a big sell off and then a sharp reversal higher again last week when we had the volatility surrounding the Fed but a good push higher off the 260 level and this box that I had here and now we're just the thing is it's still even though we sort of pushed above a couple of highs here this peak here only had one lower week it's not the most solid looking peak so really this is the kind of more interesting peak up here even though it only has one to the left over here obviously a lot to the right hand side and then the big ones right up here so we're still arguably in a bit of a kind of downtrend mode so definitely possibility and then selling the market and being this being the big kind of trough down and up and then a sell off from around here so then we've got this 61.8 has drawn from this high it's arguable which high you draw it from what I find sometimes useful is just the fact that this 50 level already worked quite well according to this peak which implies that might be the one that people are watching we're getting a bit of a sell off before this 61.8 at the moment now commodities have all been a bit on a run so if we look at silver now I've been tracking this all along this was the declining RSI trendline that was working quite well this was declining price trendline and this was all fairly textbook the one thing that caught me out initially was that we had these lows here and we had a marginal close below this 15.50 where was that close you look at the last price it was actually 51.50 these lows were slightly above 15.50 so then that didn't follow through got a few kind of inside days and then eventually that was the firstly that with the break below and then the close above kind of a small hammer pattern there then when we got the breakout through this high and above the rising trendline that was when we started to know we were in business obviously also corresponding with this candlestick sorry with the breakout candlestick is when we moved to the RSI so double confirmation trendline and the RSI trendline followed through the next day close above 16 and these lows over here and then we just got that massive move on Friday right up to that previous peak so there's not much in the way of support in this area and that's why I think probably I wouldn't be surprised if this is about as far down as we get there's not going to be too many people with a strong candle like that wanting to sell from there only so far as that I wouldn't be surprised if we push back on and maybe make it up to this this Feb 13 high up here close to 1750 WTI I was looking at earlier and actually the chart I think is most useful on this and it's actually a bit of a kind of early look at what we've been seeing in the likes of copper and things but here this is the weekly chart you can see and here is the low and here we've had this false break through the low and come back and close to above so kind of similar things that we saw that caused those massive moves higher in copper and silver so the market's still lower it's still a downtrend effectively in oil but we are facing a bit and there's a possibility that this gets a follow-through higher up to the data a bit better this area of former support got broken and now could become resistance they've got the two moving averages as a confluence of resistance there as well so we're going to get a push high to that and possibly a push high to the top of the range around 54 so on the daily chart there's a bit of nothing going on at the moment here in the daily chart but we've got to close below the previous lows if we do that line a bit better here close below then the bullish and golfing ish kind of candle and then just various sort of inside days but not much decision going on can't really tell too much from that only that the follow-through lower didn't really take much shape but we haven't seen much to the upside either so we do look at this weekly chart I think that tells us a bit more what that folks break through and then a close above so just briefly on all price at the end here it's really we've seen some comments from the Saudis today so that's a lot of a kind of thing that can push markets around on a day-to-day basis basically saying they're not going to cut production I think we can probably believe them that they were there, the Saudis were there to cut production but they don't want to do it by themselves and the thing is OPEC, even amongst all of them together are not swing producers anymore Russia is producing a lot of oil Venezuela is and obviously the US is so until it's all kind of agreed amongst various countries perhaps some of the South American countries and Russia and OPEC all agreeing to cut production together then I don't think it's I don't think the outlook for looks that good but we've obviously come down massively so at some point we're going to see some kind of side-raise markets until there's further evidence of really increasing production but that US inventories data on Wednesday is going to be pretty big as usual for W2IN and probably for Brent the rig count data on Friday is arguably not as important these days just because the number of rigs have been falling and eventually that will have an effect but at the moment US production has seen on the inventories data on Wednesday has been increasing in spite of the falling number of US oil rigs so that's about it for this week again just data-wise today we've got Dragby's speech as well as a speech from Stanley Fischer Vice President of the Fed so quite two big speeches happening on Monday tomorrow it's going to be about the inflation data in the UK and US Wednesday durable goods Thursday UK retail sales and easy jet earnings on Friday the US fourth quarter GDP final release so that has some big things to be watching and should be some opportunities especially following on from that volatility that we saw on Wednesday last week so good luck with the trading thanks for tuning in we'll see you next week