 Hello and welcome to CMC Markets on Tuesday the 24th of March and nearly one week on from the fallout of last week's Fed Minutes. Now those of you who watched the video last week will know that I warned that the Fed could well be a lot more dovish than the market had anticipated and despite the fact that they did drop patients they were indeed a lot more dovish than the markets had expected and we highlighted the 107 area as being the key breakout point for Eurodollar on any move higher. We've got that move higher. We've also seen new record highs on the DAX. We've seen new record highs on the FTSE 100 and we're going to look at all of those three markets in the context of where the next key levels now are in the wake of obviously last week's events and hopefully in the context of the events that we're probably going to be looking at throughout the remainder of this week and to the end of this month and the end of the quarter. So last week we looked at the FTSE 100 and on the subject of levels I highlighted the 68-60 level as really a key resistance level and if we broke above that then the likelihood is we could well retest the previous all-time highs at 69.74. In the event we've broken above those previous all-time highs at 69.74 and managed to maintain so far a foothold above the 7000 level and I think a large part of the reason why the FTSE 100 has done particularly well in the past week has been the weakening of the dollar but also the weakening of the pound. Given the higher weighting of FTSE 100 stocks that essentially report their earnings in both sterling and dollars that's going to be a net positive for the FTSE 100. So certainly in the context of where we are now I think the previous resistance level at 69.75, 69.80 if we get a dip back down there we could find a significant area of support around about 69.80. So that's the key level to watch out for for any pullback for further gains going forward. So let's move on to the German DAX and this is one index this year so far that has continued to break records beginning of 2015 we were trading around about nine and a half thousand we've made new record highs earlier this month above 12,000. Now there is some evidence that maybe we could well be starting to see a slight stalling of momentum and I don't think it's any coincidence that this stalling of momentum has occurred in the past week or so since Eurodollar may have found itself a little bit of a short-term base. Now we warned last week about a potential short squeeze in Eurodollar in the event the FOMC wasn't anywhere near as hawkish as we expected it to be and that has certainly turned out to be the case the fact of the matter is the Eurodollar was turning into very much a one-way trade and I think it was prudent to be cautious. So the big question now is where do we go here for the DAX and for the Eurodollar. Now if you buy into the narrative that the performance of the DAX is correlated to the weakness in the Eurodollar then further Eurodollar weakness should mean further DAX gains. Now some of the charts that I've been looking at over the course of the last week or so would appear to suggest that maybe the Eurodollar has found itself a short-term base. If that is in fact the case then we could find that the DAX could well top out and start to roll over and that wouldn't really be unexpected because if you look at where the DAX was at the beginning of this year it's put on 25%. So it's overdue a significant pullback, a significant correction. So certainly looking at the daily chart on the DAX there is some evidence of trend exhaustion. Let's look at Eurodollar to see whether or not there is a risk that we could actually see a move back above the peaks that we saw last week at one ten and a half and maybe a retest of one twelve and a half and maybe even further towards one fifteen. So let's look at our Eurodollar chart and let's play a little game here. Guess when the Fed announcement was. I don't think you'll need to look twice that massive spike towards one ten and a half before that correction lower. But what that spike has told us is that potentially we could have cleared out an awful lot of short positions and I think sentiment could be starting to shift just ever such a little bit because I think the focus now I think is on the US data and the likelihood or otherwise as to whether or not the Fed will look to tighten policy this year. The prospects of that have been pushed out. The big question is will the Fed tighten this year? If like me you think that prospect remains unlikely then there is certainly potential that maybe we've seen a low in Eurodollar thus far. Now on this four hour chart we do look incredibly overbought so I think there is potential for us to test back towards the 108 level and the trend line support from the lows on this chart here that we've drawn in from the middle of this month. We've also broken the trend line resistance from the December highs so certainly the sentiment is starting to shift a little bit but certainly not enough to suggest that we could not we probably might not get further pushes towards the downside to try and clear out any stay-alongs. At the moment the sentiment is starting to become slightly more uncertain in terms of the overall direction of Eurodollar but my bias is slightly shifting towards a much sharper short squeeze and I'll show you why in the context of this next chart. So this next chart is a weekly candlestick chart and I've highlighted the two candles in question that I want you to pay particular attention to. This is not quite a bullish engulfing week but it's certainly as close as it can be without actually being one. On the flip side of that we've got a similar looking candle on the dollar index, the weekly dollar index candle which does appear to suggest that potentially we may have seen a short-term peak in the dollar. So given how closely correlated these two markets are we do need to be cautious of further Euro dollar gains, further US dollar losses. Things get a little bit more interesting when you look at the monthly candle chart. Now we've got another week until month end so this candle is not fully formed but certainly if we remain at the levels that we're currently trading at right now then there is potential for a monthly hammer. Now hammer is a significant reversal pattern in candlestick charts so we need to pay particular attention to this candle because if it does post a hammer then there's a prospect, a significant prospect that we could well have put in a medium-term bottom and could actually potentially retest one 12.5 and maybe one 15 and one 20 over the course of the next five to six months. Let's also have a quick look at the client sentiment and we can see from the client sentiment that people still traders still want to sell the rally so that means for me the buyer still remains more to the upside than to the downside. Dips are more likely to be bought into so again that's another potential warning sign. So that's pretty much it for this week once again thanks very much for listening this is Michael Houston talking to you from CMC Markets.