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Can you believe this? Monday’s video…

Charlie has a bit of a rant today, it must be that time of the year again! He also looks at the key U.S. indices….

Hi this is Charlie giving you Monday’s market commentary, I hope you’re very well.

 

I’m actually recording this on Sunday evening so we’ll have a look at the main stock market indices in a minute.

 

I was in interviewed for Loaded magazine… I know.

 

I did the interview a while ago but it’s out this coming Thursday so if anyone’s interested in reading that article, its just giving advice to anyone who might be interested in trading.

 

I’ve got a couple of other bits to mention. I got wind last week that a fairly high profile educator, when trading in front of people to train them, uses a demo account but tells people he’s trading off a live account. I was just a bit surprised by that.

 

I’ve always said that, of educators, only 20% are the real deal, the rest of them are not, and it’s a shame when you hear that sort of thing. This person’s fairly high profile, been on the TV a few times and actually trades using a demo account when in front of clients.

 

Its one of those weird arguments because you could say that actually if you’re trading in front of an audience or teaching them, you haven’t got access to all the information necessarily. You might just be working off your laptop, it’s not the same when you’re sitting in your office where you have a lot of screens and information to hand.

 

The flip side of that, if you’re saying that you’re trading live then you should be trading live. So I’m a bit disappointed this week.

 

That’s just a little warning to you, just be wary of people who make these claims because there’s a lot of people who aren’t quite what they seem.

 

For those of you who saw Friday’s video update, I was in that AUD-USD trade. What I thought was interesting was I had an email from an individual a couple of weeks ago saying “you were only looking for ten pips on the Euro and it went to 90 pips. You should look at the bigger picture and run that…”

 

That’s a good point actually, but I think with that sort of think and a lot of day traders will empathise with that. Sometimes you’re only looking for a 10-20 pip run. That’s what you’re looking at because you’re only looking at a five minute chart.

 

The reward is appropriate to the risk. Its at least one to one, more likely two to one and it will be a good trade. Sometimes when you’re looking for the bigger runs you have to treat the trade differently and have wider stops.

 

I just think it’s interesting because some weeks I’m just looking for small price movements and other weeks I’m looking at the bigger ones. Hopefully last Friday was a good example of a week where I am looking for bigger ones. Next Friday I may be looking for something small again.

 

It really depends on what I’m trying to achieve when I’m putting together that Friday video. Remember I’m trying to get them done within the morning and if I can get some trades banked then I’ve achieved my goal, as long as I’m getting that risk/reward.

 

We try and give you a variety of trades on the Friday videos. I’ve been doing the Friday video for five years now, if you go onto Youtube you can see every one I’ve ever done – the good, the bad, the ugly – but I’m happy to take any requests that anybody wants me to do.

 

So lets go and have a look at these stock market indices. They’ve turned around really quite nicely actually.

 

Let’s have a look at that weekly chart again. Remember I talked about that weekly key reversal that we had on the S&P, it was on the Dow as well.

 

We did get a bit of a follow through from it so in theory its satisfied itself that at least it’s had a follow through.

 

The way that the price action has been, would suggest that this is going to breakout to new highs. So if we look at the Dow on a weekly chart, it’s had a key reversal, it’s come a bit lower and now has turned.

 

This is where its important to do inter-market analysis because if you look at the main four stock market indices in America, it sometimes helps you out a little bit.

 

On the NASDAQ we’ve had a key reversal, we had a nice follow through from that and then we’ve gone back up.

 

The real one that helped us out was the Russell 2000 because this small cap index of 2000 stops, we can see it had a key reversal week but look how quickly its turned that back up and broken to new highs.

 

When I saw that the Russell was breaking new highs last week it told me all I needed to know, that I don’t want to try and short this market right now.

 

I could be completely wrong and these markets could completely turn over from here, but I haven’t got too much else going on now.

 

Those key reversals were good but that pattern’s been broken now in the inter-market analysis so we’ll have to see. I suspect we are going to break and go higher at some point over the next week or two.

 

I can’t ever tell you if something is going to go higher immediately. It’s had a nice run for the last week or more, so we could congest. So it looks, in this case, that it’s on the cards.

 

So for that theory to change we would have to break back down again.

 

Where we would need to break down to?

 

We’d need to break these lows, that’s the obvious one. I would suggest if we broke the lows of this big engulfing candle here then that would mean that this is probably on the cards for a lower move.

 

For now it looks like we’re going to break higher. I can’t say if its going to happen today or if we could congest for a while or do a little pullback but as it currently stands with that Russell breaking to new highs we’ve got to be watching out for the stock market indices breaking to new highs.

 

I shall leave that with you. I’m in London on Friday so I’ll be doing live trading on Thursday.

 

Have a great weekend, stay safe. See you at the end of the week.

 

 

4 Comments

  1. Gordon-Reply
    March 23, 2015 at 11:52 am

    Hi Charlie, was there something wrong with your video set up when you recorded this? We can hear you talking about the charts but we can only see a couple of days price action on the S&P500.

    Cheers

    • Charlie Burton-Reply
      March 23, 2015 at 4:09 pm

      have you only watched the first half of the video? When I start going through the charts about half way in, I show all the chart…

      Cheers

      Charlie

  2. Ben-Reply
    March 25, 2015 at 9:40 pm

    Charlie,

    Sorry to bother.

    What makes it a key reversal?

    Is it because it is an engulfing candle?

    Thanks

    • Charlie Burton-Reply
      March 25, 2015 at 10:57 pm

      A key reversal occurs after either an up or down trend. The candle has to make a new high above the prior candle’s high and then close below the prior candle’s low. reverse this for the opposite example.

      hope that helps

      charlie

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