welcome everyone I'm Lochlan I'm one ofthe sales Traders here at ACY this video is going to be a Technical Traders Outlook whereI discuss some current trends in the market what they mean and how to trade them let's get stuckinto the charts so first up I want to cover the S&P 500 as the performance of this is going todictate the performance of almost every other asset in the market as you can see we've been ina ripping bull market the past couple of months but it's actually now started to break down andlooks like it may be heading lower for the future now one thing I wanted to point out I've gotthe volatility index or the vix Down Below on the chart and the reason why I'm looking at thisif you look at the past correction that we had I.
Remember when this happened about late August lastyear a lot of people talking about a crash and that we're going to be heading into a bare marketand then slowly after started to reverse and now we're into a bull market I like to look at thevix cuz going to me the overall volatility of the market if you're going to see an actual recessionan actual crash like we last Saw uh maybe November 20121 or even Co you're going to see volatilitymassively increase because there's going to be a lot of panic and fear in the market as you cansee with the vix down below uh it's it's it's moved less than what we saw late August last yearthis overall pullback I would say is most likely a regular corrective pullback obviously thingscan't go straight up or straight down forever obviously they have to pull back at some point andwhat I'm using the vix 4 to say okay how severe.
Is this pullback how much volatility is involvedis there much Panic or fear in the market that's what I'm watching it for so far now it's brokenthrough the moving averages it's pulled back to it now from here I guess I would expect it tomaybe break down a bit lower but eventually find some sort of a base maybe around the4600 level now while we're talking about the S&P 500 I want to talk about something calledMarket bread and how it relates to the pullback that we've currently seen now Market bread forthose of you who don't know simply tells you how many stocks are going up versus how many stocksare going down effectively Mark breath is going to tell you how many stocks are participating in themove Market breath will tell you immediately the strength and direction of the move in the marketso while the Market's heading upwards like we saw.
In the past couple of months you want to see a lotmore stocks participating to the upside than the downside and that's exactly what we started tosee but eventually all Trends obviously come to an end and what you'll start to see is wheneveryou have a down day in the market you'll see a lot more stocks participating to the downsidethan the upside and while all this is happening the overall Market is still trading at all- timehighs what this suggests is that maybe the market is reached its peak and that if stocks were topull back there's not going to be a broader Market to support it so they may pull back a lot furtherand then therefore head into a bit of a downtrend which is what I think we're starting to see now soMarket breath I've got it up on the chart now and as you can see from the market breath indicatorbelow more stocks are starting to participate.
To the downside than to the upside for the firsttime this year we can see that more stocks are in a downtrend than an uptrend and this particularindicator looks at 6,156 stocks typically in market conditions like this there is less supportfor stocks that break out of consolidations or stocks that pull back to their moving averagestherefore making market conditions unfavorable for long positions so I've got Microsoft on thechart now the reason why I want to show this is It's one of it's the largest holding in the S&P500 currently we can see very nice inverse Head and Shoulders pattern down below and from there Itreversed and started to head into an uptrend and now it's trading between this linear regressionchannel uh previously failed to make an all-time high and started heading lower if it starts tobreak out of this Channel and starts to head lower.
Well then it's not going to look very good for theoverall Market as it's going to start to drag them even lower and like I mentioned before withMarket breath if most of the broader Market is actually now starting to head into a downtrendwell there's not going to be much support for Microsoft when it does pull back which is lookinglike it will do so it's very important to watch this uh this is Microsoft on the chart now nextup I've got Google on the chart now so it looks very similar to Microsoft you've got the inverseHead and Shoulders breakout and then heading into an uptrend but what I want to point about this isthey had a recently they had a very good earnings announcement which surprised the market andnow it's extended very well out of that linear regression Channel now and it's probably likelyit's going to pull back to those moving averages.
Now um that combined with an overall I guessnegative Market it may even head lower from that point and obviously being a Trader you havethe benefit of being able to play Both Sides so uh one to be watching in the future as well next up Ihave the US dollar Index on the chart for those of you Forex Traders obviously this is very importantto be watching we actually have non-farm pay rolls coming up this Friday and at the same timeyou can see the US dollar is making a series of higher highs and higher lows and we're steadilyapproaching a key resistance level as well now the theme is for nonfarm payrolls lately is actuallyto be I guess beat estimat and surprise the market so you may actually see quite a I guess wild moveuh this Friday night um that key resistance level there on the chart is definitely something thatyou wouldn't be watching if you are planning.
On be trading anything uh denominated in the USDollars which leads me next to the euro against the US dollar you can see here it's been tradingsideways for the past year or two and it's finally actually broken out of that you can see I've gotthe weekly chart on the screen now it's broken through that quite heavily and it's you know it'spulling back here but on very tight narrow candles you know not suggesting uh a lot of buying comingin for this particular asset which is always hard to tell when you're looking at foreign exchangepairs because they are an over overthe counter product as opposed to a stock going throughone centralized exchange um but I can imagine there being quite a lot of volatility and Traderscoming in maybe on this move uh on Friday evening when non-farm payroll come out particularly ifthe US dollar is strength it would coincide with.
The trend that we're seeing on the Euro USDright now next up I've got the pound against the US dollar so you can see originally itwas making higher lows and higher Highs but it actually broke that Trend right here and iteven tried to make a new high but it failed and now it's heading lower this isn't a good signfor the asset and it does suggest that it may head lower and obviously this would coincide withwhat I mentioned before we're seeing a strong US dollar uh usually when the stock market goesdown as well which is what Market breadth is suggesting people flee to a safe haven asset USDollars being one of them so all this is kind of correlating obviously you know the market cango both ways but it is very important if you're going to be a trend Trader to be aware of okaywhere is money going how does all this relate to.
Each other and how to want to trade it and that'sreally the I guess the goal and the theme of this video next up is the Canadian dollar against theSwiss frank so it broke out of an inverse Head and Shoulders pattern started an uptrend actuallyfaded a previous Supply area uh which is typically suggests that it may want to head higher but it'sactually now just trading between this range I mean it wasn't even able to break a new highso what I would be watching for is for it to I guess go sideways for a little bit longer and thenform maybe a tight Pivot Point around resistance and then some sort of a breakout um that wouldobviously coincide with the carry trade as well as the Canadian dollar has a much higher interestrate uh than the counterparts over in Switzerland um which would obviously coincide with the trendof this asset as well all right next up I've got.
Dollar CAD on the chart you can see it's beengoing sideways for several years now but now it's actually finding starting to make higherhigh in a series of higher lows as well and it looks like it's actually starting to form a nicetight Pivot Point around resistance as well uh a breakout of this would be a very strong signsignaling signaling that it may actually head higher going forward as well next up I've got gowhich has had a very good run the past couple of months but as I've discussed it can't go straightup forever we're on the 2hour chart you can see it formed a head and shoulders top uh bearishdiverence on the awesome osculator down below and it's broken down from that and headed to theprevious support area and I've actually got the volume on the chart as well you can see where mostof the volume or most of the liquidity is uh is.
Down at that 2165 level should gold continueto go lower it's very likely it's going to find support down there so definitely be watching thisgoing forward if you are trading gold and lastly I want to finish on some Australian stocks soI've got SMR on the chart now St more Resource as you can see it's been in a linear regressionChannel or an uptrend uh the past year or two very strong earnings the past couple of yearsas well uh you can see it's forming an inverse Head and Shoulders bottom as well which istypically seen at the the bottom of a trend and then the start of a of a of a new trend nowwhy I want to talk about this particular sector now the reason why I want to discuss thisis we've recently seen a very strong uptrend particularly for speculative stocks so techcompanies semiconductor companies and so on.
Now usually when this happens people I guess haveless of an interest in the traditional value stock so stocks that produce dividends and uh growingtheir income consistently as well but typically when you see people start to sell out of thesespeculative stocks money never leaves the market it just goes into a different asset class andtypically sometimes you may see money go back into to some of these value stocks uh SMR if youif you would actually follow this trend so the and the lows of it it does actually inverselycerate uh with the NASDAQ or the S&P 500 as well so that's why I want to bring it to yourattention as you start to see the overall I guess NASDAQ and S SP S&P 500 sell off you may see somemoney that would normally go despective stocks go to some value stocks as well and there's manyof them but I wanted to point out this one uh.
Considering that it is showing an inverse Head andShoulders as well at the low and lastly I want to talk about red five so this is a Gold stock onthe ASX if you have a look at it okay so all the markets have pulled back Gold's even pulled backbut this particular stock it's holding above its 21-day moving average so what this potentiallysuggests is right now it's being suppressed the market is overall going down there'd be a lot ofselling pressure coming in for this particular stock but it's still managing to hold up quitewell and what this suggests is okay let's say gold starts to head upward again and the stockmarket starts to head upward again now there's not going to be I guess any suppressions comingonto this particular stock what will it do then will it take off or maybe it will just continueto go sideways because no one really is paying too.
Much attention to it something to take note of ofcourse uh it's in obviously a sector that's doing well the past 12 months um I'll be watching it andthat 21-day moving average level is going to be key all right that's it for this week if there'sany assets you want me to cover comment down below I'll address them in next week's video if notI'll see you all next week thanks for watching
