Video summary
The video begins with an overview of the upcoming economic calendar, noting that while there is limited major data this week, key events include initial jobless claims and Fed surveys on Thursday, followed by S&P Global flash PMIs on Friday which will offer insights into July's economic progress. The earnings season is also set to kick off later in the week with reports from Alphabet and Tesla, paving the way for a busy next week featuring most major tech names except Nvidia. Amidst this backdrop, the presenter highlights that while the euro has weakened further without significant trend changes, it remains within a bearish flag pattern; a decisive break below the 113.50 region is needed to confirm a downward trend toward support levels seen in May 2025, with potential targets around 111 or even 110.60 if the projection holds.
Turning to other major currencies and commodities, the British pound has failed at resistance near 1.3550 but is finding temporary support at its 20-day moving average, though a broken uptrend and declining RSI momentum suggest further weakness toward the 1.32 region as dollar strength persists globally. The Japanese yen recently broke out of an ascending triangle pattern to reach the 163.25 area, revisiting levels unseen for decades, with potential upside targets around 164.25 if the move sustains, despite being close to upper Bollinger Bands. Meanwhile, oil prices have surged from the 72.50 support zone back up to 93, establishing a key resistance band between 93 and 96, while gold's recent 2% gain challenges its established downtrend, though strong converging moving averages and potential dollar rallies could still push it lower if the breakout at 4180 fails.
In European markets, both the German DAX and the UK FTSE 100 are described as chopping sideways within well-defined ranges, with the DAX facing resistance near 25,460 and support around 24,684, while the FTSE trades between 10,670 and 10,390. The presenter notes a historical correlation between copper prices and the FTSE, suggesting that a continued rally in metals could potentially lift the index, although this remains uncertain. In the US equity markets, the NASDAQ rallied nearly 2% to reclaim ground near its 28,570 support level after breaking lower last week, but failed to close above its 10-day exponential moving average, leaving a critical decision point at 29,330 where a failure could open the door to declines toward 26,900 or even 25,013.
Finally, the S&P 500 and Dow Jones Industrial Average are analyzed as mirroring the NASDAQ's indecision, with both indices struggling to break above their respective 10-day moving averages after recent declines. The S&P 500 is testing a trend line that, if broken, would likely lead to lower prices with support at 7,350, whereas a failure of this pattern could signal a move back toward previous highs. Similarly, the Dow Jones has stayed above its 20-day simple moving average for most of the period but has now dipped below it for three consecutive days—the longest stretch in some time—making this level crucial; a sustained break above would likely return prices to recent highs, while continued failure could trigger a test of support around 51,800 and potentially a drop toward 50,500. Overall, the presenter concludes that while short-term volatility is expected, these technical setups will provide clear indications of direction once momentum shifts in either direction.
Read the full video transcript
Hi everyone, this is Michael Kramer
Capital. Today is Tuesday, July 21st.
That's around 4:15 p.m. New York time.
Relatively speaking, there's not a lot
on the economic calendar this week. Uh
July 22nd doesn't really bring us
anything. Uh Thursday, July 23rd brings
us the usual initial jobless claims that
we get and [snorts] continuing claims, a
couple of Fed surveys. And then on
Friday, July 24th, we will be getting
S&P Global flash PMIs, which will give
us the first real look at maybe how the
economy is progressing uh in the month
of uh July. Additionally, of course,
we'll be starting earning season in a
bigger way uh later this week with
Alphabet and Tesla reporting. And then
of course next week we'll get all the
major uh MAG 7 type names with the
exception of Nvidia. With that being
said, we have continued to see the euro
weaken uh further this week. Although we
haven't really made any significant
progress, I think what's important here
is that the trends that we've been
seeing and thinking about are really
still holding together. I mean clearly
when you look at the euro, you still
have the case of what is a bare flag
here. uh we are much closer today to it
breaking than we were uh perhaps the
beginning of last week. Uh right now it
looks like we need to get below the 113
area uh 113 and a half region really to
get a clean break of the trend line and
uh support uh which would potentially
set us up to a uh for a move back to
11270
which is an area of support that was
back in May of 2025. But realistically,
if we were to, you know, do a projection
of the bull of the bare flag, it would
really have the euro going back down
somewhere towards this 111 area, maybe
even as low as 11060, which was the low
that was established on the 13th of May
in 2025. Uh when we look at the British
pound, that has reverted. We did fail at
uh resistance, which was at 135 uh50 or
so. Um, right now we are finding a
little bit of support at the 20-day
moving average, but I would point out
that it looks like um there is also was
an uptrend that had formed in the
British pound that clearly has broken.
Although we don't have um uh any sort of
patterns that to to look at, what we do
know is that the RSI momentum indicator
also has started to turn lower. And it
looks like to me at this point the 133
12 region probably serves as a minor
area support with a bigger level of
support down around 132. And it looks
like, you know, given broader dollar
strength globally, uh that there's a
good chance that we start seeing the
pound weaken uh more materially. And
speaking about, you know, uh, global
weakness here today, the yen, which had
really been kind of building up for this
moment, it looked like for some time
with what had looked like an ascending
triangle pattern, clearly broke out to
the upside today, uh, breaking out to
the 16325
area. And again, when we kind of in this
area, we're going back to a period of
time that we haven't seen in I guess
four decades. And that's what makes this
a little bit more challenging to assess.
But basically at this point, the next
kind of best guess you can do is to
either look back and find your support
and resistance levels from the past. Or
you could try to measure uh the distance
from the high to the low and then from
the breakout and that would take us up
maybe to around the 164 and a/4 to 164
1/2 region on this potential move if
this sustains. You can also see that
we're not even overbought yet on the RSI
and you can also see that the Ballinger
band we are close to the upper end of
it. Uh but again the momentum indicator
suggests that maybe this could extend a
little bit further even though from a
moment from a Ballinger band standpoint
we're a little bit at the upper end. Uh
I wanted to point out here that uh we
have seen so essentially we saw uh oil
come all the way back down to this 72
1/2 area. We've seen it now extend all
the way back up to 93. Um, this is
obviously going to be the next key area
uh for Brent at 93 because again this
served as an important area of support
on the way down. This is going to serve
as an important region of resistance
between 93 and 96 on the way back up if
this should continue. Notice the RSI is
already up to around 64. Also notice
that we're above the 10day and 20-day
moving averages and and we're back above
the 200 day moving average. I think also
importantly, you can see that we're
grinding right up along the upper
Ballinger band, which has really been
serving as resistance. Now, those bands
should really continue to expand for a
little bit more, which really does
suggest that there's probably plenty of
time, plenty of room for this to
continue to rise. If I were to expect an
area of resistance, I would expect it to
come somewhere in this 93 and a half to
96 region. But again, uh that's with
support probably somewhere at the 20-day
move uh at the 10day exponential moving
average, which appears to be serving as
such at this point in time. When we look
at gold, it actually had a pretty decent
day today, rising by about 2%, which is
an interesting uh sort of situation that
we have now with it because uh this, you
know, kind of brings into question
whether or not gold is breaking the
downtrend that's been in place. And you
could also begin to wonder, I guess,
whether or not gold uh is going to maybe
break out here to the upside. Um it's a
tough call at this point. You can
certainly see on the RSI momentum
indicator, it's fairly close. You can
also see it uh when you look at it from
this perspective. Have a little bit
further we could go. Ultimately, I I
think this is going to be a bit of a
challenge for gold, especially if we
were to see the dollar continue uh to
rally. You can see that the 10day
exponential and 20-day simple moving
averages are all kind of converging
right in here. and gold is trying to
break out of this region of resistance
which again seems pretty strong. But I
think also what's in front of it is also
fairly strong too. So if even if we do
manage to escape this region I think the
next area of resistance probably comes
around 4180. If for some reason this
region breaks uh mean meaning the
breakout doesn't hold and we come back
and this was a false move and we drop
back through it, it could really be
another negative indicator that the gold
is likely to take another another leg
lower. I mean this has clearly been a
floor in it and there has been a sharp
downtrend in it which really has made a
bit of a descending triangle and we
would expect that gold would have broken
lower not reversed but in the meantime
it has and it's something to keep an eye
on. 4190 is certainly a possibility. Uh
we can see Germany hasn't really done
very much continues to really just chop
sideways. Um today we had a decent move
higher. Uh it looks like maybe
resistance again around 25,460
support somewhere around 24,
uh 684.
Uh right now 20-day simple moving
average acting as resistance. So right
now I I don't think we have a defined
trend in in the DAX. I I think
ultimately if oil is going to continue
to rise, that's going to be a problem
for the DAX. But again, we'll have to
just kind of keep an eye on it and see
how that uh develops. But I think the
ranges are pretty pretty clear at this
point. When we look at the Footsie, you
can see that continues to also chop
sideways. And again, like the DAX, I
think the ranges are fairly well
defined. 10,670
to 10,390
seems to be that region. Um here you can
also make an argument that maybe there's
a little bit of an uptrend forming in
it. And uh if we were to break that
uptrend, that would certainly lead uh to
potential move even lower. But uh again,
we haven't really seen much out of the
price of copper, although it has started
to move up again. We know that the
Footsie and copper have historically had
a strong correlation. Um and again, if
we continue to see copper rally, if we
continue to see the metals uh rally,
then perhaps the Footsie can continue to
move up. But again, um that's uh that's
a big question and and right now we
don't really know whether or not that's
going to happen. When we look at the
NASDAQ, um last week it did clearly
break this triangle pattern lower and we
did fall to support right around 28,570.
Now today the NASDAQ rallied by about
1.8%
uh pushing back up. So this is a a very
important level for the NASDAQ at 2837
uh at 28,570.
I think the question is whether or not
this is going to extend or if this is
going to turn lower. You can clearly see
that the 10day exponential moving
average, we did hit that today. We
actually weren't able to close above it,
which is a slight negative.
Additionally, we have again this
resistance region up here around 29,330.
Clearly, if if this is uh if this turns
out to be a false breakdown, then we
would expect to see the NASDAQ go all
the way up and through the previous
highs at 30,650.
Um because that is typically what I've
kind of seen happen with these types of
things in the past. But if we are to
break this level here, I think it really
opens the door to much lower levels,
26,900.
And there's even a chance you could see
the NASDAQ extend all the way back down
to at some point this region around
25,013.
There's still a lot to go here and we
don't really have a definitive view uh
based on where we are. We need to kind
of see whether how the next couple of
days play out, but I think it's a pretty
good indication in terms of where this
is going to go. Uh I think but I think
given sort of where we are, it's pretty
easy to determine which way this is
going to go once it starts to move. For
the S&P 500, it is also similar here.
You can see we're sitting right around
the 10day exponential moving average. We
haven't really been able to break out uh
from the declines we saw. If we just
drew a trend line in here, you can
clearly see like the uh like the NASDAQ,
we did break the trend line yesterday.
We came up to it, tested, it failed.
Today we came up to it, tested, it
couldn't get through it. Um, so again,
we're kind of looking at a similar
situation. Here's your
pattern, almost exactly the opposite of
what you're seeing in the NASDAQ.
Uh, so again, with the breaking of the
trend line, we would think that the S&P
would move lower. But if this pattern
fails, then we expect it to come through
and overtake these highs and continue uh
significantly higher. Obviously, if we
do uh continue to start moving lower,
7,350
is likely a next area of support uh for
the S&P. And finally, we'll take a look
at the Dow. Uh the Dow also fell to uh
rose today, but also failed at the 10day
exponential moving average. Um the Dow
has also been managing to stay above the
20-day simple moving average for the
most part. I guess the kind of
interesting thing here for the Dow is
that um it also failed at the 20-day
simple moving average. But what's
interesting here is if we look at this
chart and you look at it on a line
chart, you can see there's really only
been maybe two times, one time very
close and really one time more
decisively below the 20-day moving
average. Now, we've been below the
20-day moving average one, two, three
days in a row. This is the longest we've
been below the 20-day moving average now
for quite some time. So, I I would keep
an eye on this 20-day moving average. If
we break out, great. You're probably
going to go back to the highs. If you
continue to fail here, that's probably a
negative. Probably suggesting, you know,
if we that's probably suggestive of a
test of support around 518 with a break
of support potentially setting us back
to around 50,500.
Anyway, that's all I'm going to have for
this week.