 Okay, it is 12.15 in London on the 14th of November 2016. Thank you very much for attending this CMC Markets weekly charting analysis with myself Jasper Lawler. As per usual, just going to run through the risk warning screens, please have a quick browse through those. Well obviously, been quite the wild week in markets to say the very least, shock US election result caught many people unawares. Obviously we want to discuss where things head from here. Many people surprised at the positive secondary reaction in markets. We've got the initial sell-off in the dollar and in stocks, but it didn't last too long. And now we're talking about a fresh record high for the Dow Jones industrial average today on Monday. We already saw one last week. Now things are looking slightly different in European stocks. Politics obviously playing an increasing role, interestingly though the British pound was not on the awkward end of the politics at the moment. It's already had its fair share. And now markets looking ahead to things like the Italian referendum next month and the French and German elections next year. Just quickly, this is obviously the CMC Markets platform we've got going here, but just quickly in terms of a look ahead to next week, this is on our CMC Markets news analysis page. We've got our weekly earnings calendar here. So if you're interested in the big corporate news, we had that all set up here today on the foot of Taylor Wimpy amongst the big ones reporting, but obviously still the tail end of the U.S. reporting season to go. Mostly the big U.S. retailers alongside Salesforce, one of the interesting tech names. We've done a small write-up on some of those and obviously we've got Royal Mail as well. Probably the biggest U.K. company to report this week. On the economic side, obviously always revert to our market calendar here. I'm not going to go through it here, but the main economic data this week will be U.S. retail sales and U.S. inflation and a flood of U.K. data, which for whatever reason in the last couple of months all the U.K. data seems to have congregated into one week. So we've got retail sales, inflation and unemployment and wages data all for the U.K. this week. Giving you a bit of context to that in terms of market, let's just quickly pull up this dollar index chart. So here we are, we've hit 100 today in the dollar index. That's obviously a huge psychological level and not surprisingly short-term sell-off from there. So benefit if I inside, you've had a cheeky little sell order in at 100, but it's such a big round number, you'd have gamed yourself 30 pips off that. But obviously the trend is higher in the dollar now. This was obviously the initial sell-off in the dollar reaction and subsequently we've been moving higher post the election. The general idea here being that while obviously Donald Trump is controversial in many ways, if you strip out what he is likely to push for, what he can actually kind of get through in Congress, actually a lot of the proposed policies are quite business-friendly. Tax cuts being the first and foremost obvious one, the U.S. has needed some tax reform for a while now, that's been difficult under a democratic president which obviously left and right politics on the left generally preferring more efforts at redistribution of income through higher taxes on the right of the spectrum, not so much, more in favor of tax cuts, lower taxes, typically lower spending as well, so it's the spending side of things that's getting a lot of attention at the moment. The possibility of infrastructure spending has been one of the reasons why the Dow has been doing way, very well. It's been companies like Caterpillar that have really taken off on the prospect of more fiscal stimulus from the government, that I would argue is probably one area that's going to be a little bit difficult for the Donald to get through because as I said the nature of the Republican Party is generally a bit more fiscally conservative, small government style thinking and that's what they're elected on so they're not necessarily going to give that all up just because it's a Republican president. Obviously one of the biggest concerns being trade barriers and I would say one of the some of the biggest gainers, some of the biggest forlors rather are things like Ford and GMs, the big autos, companies also like the big technology companies, Apple etc. that are trying to push into China which obviously was at the receiving end of a lot of the Donald Trump rhetoric during the campaign if he actually follows through on those promises which I think is on the China front I just think will be difficult because it's basically it's not all one way between the US and China. China buy a lot of US treasuries, obviously US consumers benefit from cheap Chinese goods, obviously they lose out because the manufacturing of those goods, the jobs have shipped abroad which is a lot of what Donald got in on so maybe tariffs on imports from China would possibly lead to more jobs at home but would also lead to huge higher prices and the average US consumer would not be too happy about that and it would be that negative effect which would hit through first and does Donald Trump like any other politician really have the gumption to follow through on something that's going to be negative in the short term for potentially long term benefits which a lot of people dispute the long term benefits, the general economics consensus is that free trade is best. So a lot of question marks but still at the end of the day, this is the price action in the US 30, this was the range that we contained in obviously huge volatile breakout that just made it to the, we could probably draw a line, draw our support through here and this was obviously this low here, little false breakout there, the touch there and obviously we perfectly stopped there. You'll notice I actually literally drew my line on this low first and that is perfectly where the market stopped so congrats and I'm going to show you a few of these, I'm sure you'll have seen them already but there's a few examples where if you just had a little resting order in and a decent few percentage points away from the market you'd be loving life, Dolly Yen being another really stand out example. So at the moment it's a little bit hard to see where we go from here, obviously it's been such a volatile movement but my bias here is that okay in terms of the US markets the bias has flipped to the upside here, now obviously we're looking fairly overbought but that can happen for a sustained period in an uptrend, you know I'd imagine that we'd do a bit of a pullback but it probably won't be go too much further than these old highs. You know we're still very much in an uptrend with the break of these highs but what we have to be aware of here is that we have kind of broken a trend but we've pushed back above it so it's a bit, you know the uptrend was thrown into question by the break of this trend but obviously it's kind of unwound that now so you know things could head both ways obviously they always can but you know my bias is with a break of new highs that's showing the market strength I'm expecting it to continue. Maybe we do take out these these peaks here because it wouldn't take a massive retracement just to drop back to maybe 18-650 but then that 18-370 which was the top of this range that we were chopping around in for a number of weeks that I would be looking to hold so again looking for potential bounces from here and then here below there then it looks like we're back into range trading and you can see us coming right back down to these lows and you know but then back and forth again so I've jumped straight across to the US obviously with the Trumpomania that was always natural but if I do go back to the UK stocks a slightly different picture obviously and again the technicals have held up quite well you know we've had this line of support on here for a while this was what I first highlighted where the you know a swing low had been taken out to the downside and I was looking for the for the drop you know that drop did take place didn't end up taking out the lows found some support on this rising trend line went right back up to that very same line you can say this line you know this area of support here also kind of works but obviously we've got that big volatile spike up in the election last week so again it's it's slightly different to the nature of the US move where we're much closer we obviously we took out the highs we never took out the highs and we respected this downslaping trend line and we've now eaten up a fair bit of that rebound so based on the current market structure I'm imagining that we're probably going to come back to trust it test this trend line again and it's just going to be a test of us to how far we come back down from that big move higher we took out the this peak here but are we yeah we found quite nice resistance so I think probably what we're looking for here is just some some way to assume that the breakout higher is going to continue so it's we've obviously found support thereabouts at the 61.8 we're back into filling this little small gap at the moment so it's going to be probably somewhere in here if the market is going to hold up is where we're looking for you know that's that's our kind of main support zone you know why are we looking for the market to push higher well more you know I would say that probably US stocks are in a position to outperform at the moment but you know it will be unlikely for the FTSE 100 to fall off a cliff while US markets are pushing into record highs these things generally correlate a bit more strongly than that you know that is unless the European markets are you know kind of telling the truth here and you know the US stocks are you know just a bit late to the tail of the markets rolling over that could prove to be the case one of the things obviously we're watching at the moment if I just jump away from stocks at the moment is this move in bond markets most pronounced in in guilt you know we've obviously had a big drop here into the support zone if I go even further out you can see it's this long-term zone of support here that we're now sitting in just above this rising trend line so we could be nearing the end of this correction but if this this bond set off keeps gathering pace that you know that the correlation between bonds and equities has been positive over the last couple of years so you know this you know bonds could be about to lead equities over the edge and it's not just you know a lot of people referencing guilt and brexit and things but really it's not it's not just guilt you can see that actually treasuries and guilt's moving pretty much at the same lick at the moment treasuries the nice little trend line bounce example there you know we had the rising trend line broke the trend line came back test didn't work that time did work that time Marcus have rolled over so congrats to anyone who sold on that one I can't say I can't say I did but obviously now we're pushing back down into a fairly clear cut support down at 126 in treasuries so this will where we've already approached now is an area to expect potentially some sort of support coming back into the market just have a look at Germany again I mean we've we're still in this trading range and it's it's it's worked remarkably well we've come we've come off the top of the range at the moment for a second time obviously that the volatile election day took us down out of the range so it took us below this the support here below the moving average so anyone buying at the bottom down here theoretically would have already taken profits up here so well I suppose yeah if you look into TP at the top of the range here you would have suffered this big drawdown before you got there I believe yeah so that's you know it's just an example of sometimes you can get the idea right but you know when you're trading around a big volatile day like the election you know suddenly the technicals can be thrown off temporarily and so if you were long down here made it this far but you know you got stopped out maybe at the bottom of the range before eventually went to where you expected that's definitely a tough one I'm going to jump over to dolly end just because that's another example I'm interesting to kind of show you in terms of where orders could be in place but again it's a would have been difficult in reality to play it and I certainly can't say I did so we would I was talking about Dolly and pushing higher you know we're talking about the triangle breakout here here's the height of the triangle here's the breakout the projected target for that is 110 as we mentioned in the last week's webinar you know we talked about the fact the moving averages were spreading out they looked like the trend was pushing higher but you know what ended up happening is that the market dropped below this support that had held here dropped right back to the 78.6 fib you know and this little breakout right here within the triangle so had you had a resting order down there you know you'd have made several hundred pips in just the space of a few hours you know had you been long from down here with a stop beneath the low you obviously this is this is a complete disaster because you know you we're up there towards the target already but you got wiped out by those volatile conditions so it's you know if that did happen to you I'm sorry if you had the order resting well done the lessons take away is that you know when we have a big volatile event coming up you need to adjust your stop placement or just you know take yourself out of the market but obviously the when doings that when you doing that you you minimize the opportunity for taking advantage the other the other factor here is I suppose that you know if you are expecting that bigger range of volatility you know when you're buying naturally you just push your buy order lower you know if there is that possibility of the market swinging around in that bigger band so if you did originally have your buy position at the 50% of the 61.8 you think well okay we've got the US election that really could send markets haywire you know let me push it down to the 78.6 but as we stand I mean things playing out quite well we're in a clear up trend as the as the the moving averages and the in the higher prices would tell us we're obviously at this key level of resistance the moment you know the top of this triangle so wouldn't be surprised to see a pullback from the kind of 108 area but I'm still imagining that we we do get to this 61.8 extension from this you know if we're looking at this is a hundred percent that's 61.8 percent of that then we've got the triangle is 100% extension the middle and beyond that for the more aggressive target around 111 we've got this move measured from the breakout above so with this with the dollar hitting 100 and obviously Dolly Yen breaking out Euro dollar breaking down which we'll have a look at in a sec the the US CPI data I think could be very significant this week because part of the idea here is that Donald Trump's infrastructure spending is going to add to already a kind of reflationary trend inflation generally quite good for stocks not so good for for the bond market typically you know you'd expect that the Fed to start raising rates at a quicker pace you know higher yields obviously bond prices go down so if we do see inflation continue to move higher in the US obviously that supports the case for US rate rise and also supports the case for higher inflation generally and maybe a faster pace of rate rises next year from the Fed and obviously they can they can afford to do more rate rises without the risk of sending the economy lower if the economy is being propped up by fiscal spending and like an infrastructure program but by the Donald so if we look at the euro here now the euro sparked into the life of the months of us talking about it being very difficult to trade and it's still but sort of in a range but you know see the this move down here got heavily retraced characteristic of a kind of range market but we've taken out the lows and and this now starting to look like a market turning lower you know if you take this kind of broad section of price action we're still kind of within it so we can't get too excited yet you know really when the euro can really spark into into life is if we're gonna get down below that 105 while we're above 105 we're still kind of in range bound conditions but I would say just this we're in that sort of we're still in that 105 to maybe 116 on the top side price range but if you if you just kind of draw a trend through something like this you have to say that the slight bias was higher came down and then you would expect higher prices from here but that didn't happen actually what we got was more like a lower highs and obviously eventually we came off these peaks here off the trend line and we've rolled lower so this to me at least is how I'm gonna stand to to 105 because the from this generally bullish bias we've turned it now into a lower bias now why is that well obviously the dollar is strengthening you know if you just look at today I think they moved down in the euro that's just a bit less I think it was was in line but the strengthening of the dollar kind of in line with the the weakness in the euro so to some extent just pure dollar strength also you could argue to some extent some political uncertainty shifting to Europe notice how the euro is down 0.6 the pounds only down 0.3 and change so the pound relatively stronger obviously euro pound falling you know I think that's maybe a read readdressing of the political shift from the UK where the pounders felt felt the brunt of uncertainty around Brexit now we're looking ahead as I mentioned to start the webinar today the Italian referendum and and to the France and German elections next year I'm just thinking well okay we've had to arguably the beginnings of a trend towards popular results where with with Brexit and the US election you know that same trend is going to continue into Europe which clearly there's a risk there a lot of populist parties on the rise in Europe even before those two election results then really the political risk is is now with Europe and that would mean a week a euro so let's have a quick look at Sterling why we were mentioning it so obviously here's the flash crash so we're back we were back above flash crash type levels is that right or when did that start we're in that sort of vicinity anyway you know this was the big flash crash we're now looking a bit more orderly to the upside we obviously took out this little into rim high came down we've up we're testing that old level now we're down through this resistance area so it's chance that we perhaps drift down to it's not what I didn't mind we've got a bit of a kind of supportive trend through here so you would be looking for the market to you know if you're looking for this uptrend to continue to find a base somewhere in the vicinity that's already tested in order for a move through 127 and I'm fully recouping that the flash crash given that the 61.8 worked quite well as a an area to pull back from this drop you know I was also using these lows over here you'd like maybe just above 127 and change if using that you know if you're using this peak over here or even this peak then you're putting your next potential resistance up around 120 or just above 128 really okay and yeah one of the completely I would say almost unrelated to the election though accelerated by their strength in the dollar has been the the moves in the all market been looking really soft so obviously we weren't able to take up those two highs we were mentioning that for a couple of weeks now this was a this was a big level at 45 in Brent we dip through it got a little bit of a bounce and now we've just dropped straight through it so this is looking pretty pretty bearish to me yes there will be some Fibonacci's in this area the 78.6 but to me the fact that we've taken out this low here in the context of this this trend break with the the shorter term moving average now dropping below the longer term it looks to me like we're heading down to test these lows here and and potentially below that it obviously depends on how things pan out with OPEC but it's increasingly that that OPEC deal starting to unravel at the moment and and there are signs that US production is on on the up to gold was obviously one of the the standout ones for trading much pretty much the opposite to to equities where we had the initial flight to safety but we hit hit the highs here from September and the market rolled over pretty quickly and now we're at the the weakest we've been in in several months this was the Brexit jump obviously we've got some pullback from that Brexit move but we're now lower and it does look like we're heading down for a test of one two hundred and really that's just the big line in the sand is is is the 1200 mark through there then the gold doesn't have too much in the way of support before 1100 so signs that gold looking pretty soft here I mean just again moving averages are a lagging indicator they're not perfect by any stretch but you can see that when this short-term is above the the longer term average you get some some chop in a sideways market that's when they stop working but when it's above you know okay you can sort of generally see that we've turned lower here and we've had some bounces but they've been sold into and the trend continues to go down with this shorter term below the the but the the higher-term moving average so not all the short trades are going to work goes without saying but to me my my bias moment is is to the short side but obviously that's you know how long that can sustain will depend on 1200 the one that I don't always mention in these webinars but certainly worth mentioning this time is the price of copper this is a short-term chart so I'll actually start with I'll do a bit opposite time normally this was a huge move lower intraday so we're up there we're at 7% at one point on Friday we ended up closing the day down I think we maybe actually finished the day roughly positive or at one point it was down one and a half percent on Friday from a move of up 7% an 8 plus percent daily range is is pretty huge and it's certainly something worth standing up and paying attention to there'll be people buying the dip here assuming that the higher prices continue but to my mind this is a sign that sellers came in on mass and sold the market down now and it's going to recuperate to you know to get the prices back to where those sellers want to sell again now it could get up to our kind of sell zone up here in the 61 to 78 percent retracement area but at the moment it's not got through that that previous peak you know we've we've come away from there you know this is the support so we bounce from there we're in this range any opportunities up here you know that could again call the top should we go through then you know then obviously we're looking back back up into this sort of two six six 67 to a barrier maybe but then if we so okay we don't take price action by itself in this case I almost would you know we saw a big move down we took out that short-term support you know now we've kind of taken out some of those immediate short sellers down here looking for more liquidity to sell but if we do look at where we're generally at with this this is our this is a nice nice little triangle that we had in copper taking that as the height of the triangle the height of the trunk the the full 100% extension of that height was here so we went a bit above it you know the momentum was so extreme it's not you know we're not expecting this to turn on a dime necessarily but you know once we did exceed that level we didn't go much further and the market turned around massively so that's one one area to believe that this is significant if we pull out to the weekly chart there's no obvious highs and lows I would say but if we do pull out the good old Fibonacci again then you know we're pretty pretty darn close to the 78.6 and you know if you're using you know a 76% Fibonacci it's almost bang on that so couple of Fibonacci pattern based reasons to think that this would have been an area of resistance in copper and we've seen a big sharp reaction down taking out some short-term support so my default assumption here is that we push a bit higher and then roll over again this is a strong pattern you know you could go to say that the the trend for copper has very much shifted but I'm just talking about you know where do we move in the next few days you know I think we're going to get a bit of a pullback in this what was a very big move I think it was the biggest it ended up being the biggest weekly moving copper in 30 years so understandable that we'd have a volatile finish to it so I'm going to call it a day there thank you very much for attending everyone good luck with trading this week we'll obviously all be Donald watching let's let's see what happens next now look forward to talking to you next Monday Jasper's owning up