Trading Success Ep 7

Chris: Good morning, Cam. Welcome back to trading success with Cam Buchanan on a Monday morning, how are you?

Cam: Good Chris, going very well, very well. Thank you.

All right, so let’s get into it, because last week was a very interesting week in the markets we had. The markets, the week before had quite a strong sell off after that news of the airstrikes.

Last week, however, the market seemed to rebalance, there wasn’t any more continuation of that war situation hadn’t got any worse in the Middle East. Also, we were buoyed by a lot of results as well in the market. So we’re in the middle of earning seasons in the US. The major stock indexes that we trade being the s&p 500, and, and the NASDAQ, a lot of the companies are reporting their results at the moment.

So last week, we had Google, Microsoft, and Meta, all share their results from quarter one. And it was very, very profitable for a lot of those companies. So Microsoft showed a 20% rise in profits, interesting, their share price didn’t react at all, maybe all that good news is built into the price. And that’s what seems to happen, like gold, for instance, is just sort of just in a range now.

So I think there’s a lot of insiders know what’s going on. So a lot of people are expecting a war to come out or at the start of a war probably start to load up on gold early. And then there’s just really no more follow through now. So we’re just waiting for the next next thing to come out, I guess. So gold is sort of stabilizing around that 2300 mark, probably will get to 3000 later on in the next couple of years. Because we’re coming into this peak of this commodity cycle. So it probably should still run up but at the moment is for trading it’s sort of in a range at the moment so that so this week in terms of earnings, we’ve got Amazon coming out Tuesday Pay Pal and AMD (AMD are big graphics chip maker) that kind of compete with Intel, Nvidia kind of in that space. And they’ve appreciated massively in the last five years.

Wednesday, we’ve got the big pharmaceutical giant Pfizer, then on Thursday, we’ve got Apple, Block (formally Square) some of you guys probably aware of when you go pay at the counter these days, a lot of smaller merchants are using Square. Then another giant in the pharmaceutical world, Maderna, are coming out as well. So that’s pretty much it. Also, we’ve got a lot of news, Red Flag News this week.

We’ve got the Davos World Economic Forum’s out at the moment as well, I believe. So this Wednesday morning, we’ve got ECB consumer confidence. That’s coming out at 12am. So if you trade in the US Open on Tuesday night, that could affect us very early Wednesday morning. Right on midnight. That announcement comes out then there’s manufacturing PMI on Wednesday night, NonFarm Employment on Wednesday night. Also, there’s a bank holiday in Germany on Wednesday as well. So if you’re trading the DAX, know that it probably will be sharp, I’d say.

So there may be a little bit more activity coming over under the indexes on that day. And then on Thursday morning, we’ve got FOMC. I think there’s one over another announcement on Thursday night as well. So yes, there’s a fair amount of news that should have a short term effect on the market. But I was listening to an article this morning about what’s happening in terms of big players in the market. It seems from what this person was saying, that this doesn’t seem to be a lot of big players in the market at the moment. Still a lot of money on the sidelines.

So a lot of the day trading in the futures markets seem to be really a lot of shorter term private investors, so we’re not so what that means is that prices are quite will rebalance. There’ll be a lot of ups and downs of volatility. A lot of short covering, you know, we saw that last week, somebody asked me at an event recently, what is short covering? Well, short covering is long, I’ll get into the charts and show you. But basically, it’s where people that have been short, or traders have been short for maybe one or two days, expecting the market don’t go a lot further down the wall, the market doesn’t go down, and the market actually goes up. When when that market starts going back up, those people that are short, have to buy to exit their position, either to take a profit or to just get out of the market, they realized the markets are going their way.

That actually brings in a lot of shorter term momentum traders as well buying the market as well. So there tends to be an oversupply of buy orders and sellers not prepared to come into the market. And when you get that oversupply of buyers, and not enough sellers, then prices go up, right. And so that that may, you know rebalance again this week. So the markets may, you know, come back down into that range. But we’ll let’s look at the charts and the charts will really show us you know what’s going on. So, let me start presenting my slides. I’ll start with our our big indexes.

Chris: A few charts, when I had a look at a couple, there was back sort of slight V shape over the past or a week or two, as you were talking about the bit of a sell off and then and then a quick bounce back.

Cam: yeah, that seems to be what’s happening at the moment, just a lot of that activity. So I’ll bring this over.

So let’s look at our favorite market the NASDAQ, which is so that was that was the big sell off we had two weeks ago. That was last week. So this weekly chart is basically what we call in balance. So we had a fairly low volatile volatility week last week, however, compared to the week before, but compared to what we’ve seen over the last three weeks, two weeks, big volatility, so there’s been very big movement in the markets. And this is what we love as as day traders. So you can see where where could be if you compare to where we are, from this week’s price. Last week, we actually fail up at the 6180, all right, which is up around about 7900.

So if we look at the daily chart, so you can see the key levels this week will be this last week’s high. Alright, so we’ve, this is the day to day we’ve just opened up, I’ll just bring this, we’ve just opened up inside of seeing the range of last week. So we’ve slightly gapped up already on Monday morning. Now, on the daily chart, you’ll see this outside candle here is representing the balance now are we going to go into imbalance and really break out to the high side. Alright, and if we do break out to the high side, we will create this little imbalance zone.

So if this is the lowest price of the day, that that will be that will be the imbalance that we created on this on this chart. All right, so potentially prices will move higher. If we come back in, then I’d be looking for this high from from Thursday, Thursday’s high as a key level, if the market comes back into that price, which is let me just change my prices 788 to 650. So it’ll be interesting. That’s going to be a very key pivot point. If the market comes back into that range, then we make come back down and trade within that daily range. So the market will just go back into balance. We continue higher then, you know we could be breaking out higher and extending into these expansion zones from from last last Thursday’s reference point there. So you can see on the weekly chart, we’ve got the 76 above here, up around 18,000 mark. So now those those two levels are really important on the NASDAQ, the weekly high and Thursday’s high.

In the short term today, if we’re trading Monday that they’re going to be key reference points and the market will pretend actually come back to those and test those throughout the throughout the week, as well. So we’ll see, obviously, news is going to have an effect on the market movement this week, particularly coupled with a lot of short term traders in the market, they tend to react a lot to the news. So that’s that. s&p is very similar in its nature. Whereas the s&p

Here we go. s&p is doing very, very similar things.

So Thursday, that’s the that’s that Thursday bars is the daily chart. So Friday, rallied higher. So this is this is what I mean by a short covering rally. So the the week prior, we had quite strong selling. And then we recovered. So Monday, Tuesday, Wednesday, Thursday, Friday, rallied against these shorts here. So it was a rebalancing in the market. You we’ve also got this imbalance zone on the larger chart on the daily chart down here, which has not been filled. So that just the market sells off. And that’s another target as well down there. But very, very similar to NASDAQ, it’s got back Thursday high, and the weekly high as well being that price there, which is 515145 75. And now let’s have a look at bitcoins gone really quite hype lately, there was so much hype around Bitcoin. And bitcoin is just basically in a range it is, this is the four hour chart. So on the four hour chart, it’s in a slight downtrend. In the end, you can see also the most traded price here, if we look at the profile, from this big swing, right down here, which was down around 41,000.

The big swing up you can see where the most traded price is up around about 70,000. Now that was around about 68,000. So that most traded price has actually has risen up. So there’s a lot of people that have bought these highs. So a lot of short term traders trading on leverage. Basically, it’s just, I think a lot of a lot of just a lot of traders at the moment, just people getting trapped on the highs, buying high trading with leverage getting trapped. Alright, so you know, a lot of the seems to be a lot of traders buying around these lows, and just trading this market at the moment, because the markets got a very clear range. So you’ve got around about 60,000 Where where the price double bottomed. And then we’ve got the market failed to break that 72,000, Mark 73,000. That’s been an area of resistance to the upside.

So this markets quite range bound. If we look at the daily version, very much in a range starting to actually swing down. So we are in a swing down. So it’s looking a little bit bearish. And it could still be because typically from what I’ve been looking at having cycles and what happens around the Harvey, the market tends to rally after the heart rally could could take months and months. So we could be just still starting the cycle with with Bitcoin but at the moment it has gone very, very quiet. And last one I want to look at is gold. And Silver’s doing a very similar thing. But you can see how gold in the last two weeks has really cooled off. So we’re we’re still in an uptrend on the daily chart. However, we are actually swinging down.

If we look at the swings, the market is trying to swing down. So it’s it’s once again it’s it’s in a it’s in a it is trying to go down. As you can see here, if you’ve run a channel over the over the range, we run a channel once again, it’s giving you a fairly clearly defined range. So markets kind of stuck on the 50% of that of that channel at the moment. So that’s acting as a little bit of resistance to the upside. But you know, it’s it’s definitely it’s definitely in a time phase at the moment where the market has had a very strong rally. And now it’s just time to catching up with that big price move but longer term it’s looking like it’s I’m still wants to go up. But once again, it’s just trading within a fairly tight range right now. And Silver’s very similar as well.

Silver had that big, big rally up to 30,000. And then we’ve kind of failed at 30,000 resistance. And now where we’re stepping down or swinging down, that we’re still remaining in an uptrend there as well, on the daily chart, well, I haven’t been paid too much attention to that oil market recently is, I’ll just quickly have a look and see what oil is doing. Make sure we got the right contract. We’re on the June contract with oil.

If we look, you can see here we’ve got some liquidity zones under here. So it looks like there’s some very strong buying levels around about $82,082. And there’s looks like there’s resistance up at that liquidity zone around 87. So we’ve doubled top there. Once again, we’re on the daily chart, we’re still in an uptrend, we are swinging up as well. We made we looks like we’ve done a complex retracement here.

So once again, it’s in this period very similar to gold where we’ve had a very strong rally, and then the markets gone sideways. So we’re in this range period at the moment. So maybe FOMC news might spur something on in these markets this week. But it, I think, will be very balanced, balanced trading. Just really, I think a lot of two way trading at the moment, I don’t think you can fall in love with any one particular bias at the moment, there’s still a lot of uncertainty on the geopolitical macro level, that I think there’s just going to be a lot of, you know, up and down type trading. So which is good because it when you get that you’ve got those clear resistance levels, you can show it off, and then you’ve got those clear buying levels that you can all those support levels, you can look to buy off so that when you get there’s really defined ranges, it’s I find it a lot easier to to to get those really nice moves.

So a lot of kind of reversal type trades. At the moment seems to be working really well off those off those major lows and major highs for those liquidity areas in the market tend to be acting as a lot of support and resistance. And that’s what a lot of traders are saying as well. They’re really loving the liquidity areas and the timing their moves off those liquidity zones. So good areas to look out for, particularly in this two sided type trading. So that I’m going to stop my share. So that seems to be a wrap with the charts, guys.

So a fair bit of news to come out this week. So lots of big companies promoting results, we can see how big those moves are when those companies do come out and put their results like Microsoft on Thursday had a huge rally in the morning. And that was after hours as well. That was just when we stopped our trading room. The market just went ballistic to the high side on Thursday. And then on so we’ve had some very strong rallies in in the US session. Last week, the market did a lot of grinding downwards, but then rallied just incredibly strongly in those in those us sessions. So there’s been some very big moves, trying to find that 30 minute chart for the here we go. 30 minute chart gives some really good perspective here. So you can see here this was the this was the open of the USA Thursday hugely.

Yeah, so So basically, guys, this is a snapshot of last week. So that was Monday, Tuesday, Wednesday, Thursday, Friday. So you can see how the markets trade off those liquidity zones. On the 30 minute chart, we came back to that liquidity zone went long enough that in the US Open. And then once again, we created a liquidity zone zone down here. So that’s going to be a key reference point two, if we break that Thursday’s high. So what we’re currently trading at the moment is we’re in that range. Like I said, we got last week’s high. And then we got Thursday high there. So we’re just trading in that range. Right now, if we break into that Thursday high and hold, we’ve got this liquidity zone down here. So you can see the US markets been rallying quite strongly in section.

Chris: Yes. Sorry, gives, you a really good visual, when you look at it that way as to where these areas of, as you say, reversals or support resistance are sitting.

Cam: Yeah, they’re really key pivot points here in the market. And that’s why you don’t need to overdo trading. You know, you’ve just got to be very precise and have an order and structure. You know, we talk about in our, in our training programs, they talk about having an Order of No, what are your key support resistance areas, what techniques in terms of chart analysis, are your baseline techniques that you use, and that gives you great water, when you’re looking to put a trade on because if that is, your baseline techniques, are in those areas, then you’re looking for trades, you’re just waiting for the market to get to those areas. So that’s really good.

What you got to work on is one of those baseline analysis techniques that you use that work, you know, there’s numerous number of things, you can use this Fibonacci levels, there’s, there’s the liquidity zones. There’s certain price patterns, that double tops, double bottoms, those things, there’s all the brick wall levels. So there’s a lot of levels you can use. And it just comes down to the ones that just have a higher probability of working from your, from your testing strategy.

So anyway, guys have a good week in the markets where there’s gonna be lots of lots of volatility. Yeah. So, map your charts. Do you do your analysis early in the week? I’ve given you a few good pointers there already. So use those and let’s see how we go. And we’ll we’ll come back next week and review what happened and see what effect we’ve got out of those news announcements as well see how the market reacted.

Chris: Definitely, thank very much, Cam. That was awesome. Thanks

Cam: Chris. Bye, everyone. See you next week. Bye.

To listen to more of “Successful Trading with Cam Buchanan” you can find the series on Spotify, and you can also find all of the episodes of Successful Trading with Cam Buchanan on YouTube.