Hello there. Welcome to CantosCharts. I'm Steven Mayne from Equitrade and today we're just going to have a look at a couple of stocks to put on your watch list.

Start with GlaxoSmithKline. With GlaxoSmithKline what you'll notice it is generally considered a defensive stock, so in these volatile market conditions you might actually find the defensive stocks performing slightly better than you would usually expect as general equity traders move out of the high beta stocks and move into more defensive equity positions.

What we can actually also see on the technical side of things for GlaxoSmithKline on this daily graph we've formed a new relevant low. But as we formed this relevant low we can see we had some positive divergence on the RSI indicator. I'm actually looking at the MACD histogram where you can see there is some positive divergence on that as well. In fact, any further up days on GlaxoSmithKline and we should really expect the MACD to start forming a buy signal which would again be very positive for the stock.

Coincidentally with this low we actually had a buy signal forming on the stochastic as well. Really, for people looking to buy GlaxoSmithKline take advantage of the market volatility. On any down moves on light volume you should really look at starting buying into the stock, placing a stop just below the last recent low and I suppose for a general target, the 200 simple moving average, which is shown in black on this graph, we can see that previously. It was actually support.

So assuming that what was once support will hopefully become resistance so we can have quite a nice risk/reward here moving back for GlaxoSmithKline, to start moving back up to the 200 simple moving average.

Just going over that, the recent low was formed on positive divergence on the RSI. We've also seen positive divergence on the MACD histogram as well and as I said, any further up moves on the stock will actually probably get a buy signal on the MACD as well which will probably produce some more impulse buying on the stock.

We've got a buy signal on the stochastic. For those really looking to go in, you should really be looking to put your stop about 11.10 and really targeting a move back to the 200 simple moving average. Obviously buy into the stock on down moves on light volume. Really, that's what we're looking for to start initiating buying into GlaxoSmithKline.

Moving onto another defensive stock. Obviously, defensive stocks will be very much in focus during the current volatility in the markets. Imperial Tobacco has got quite a similar graph to GlaxoSmithKline here.

We can see that the last relevant low was formed on positive divergence on the RSI, but actually also the stochastic as well. We can see that the last two days of up moves have produced a buy signal also on the MACD, so we have all three momentum indicators suggesting that the next big move on this stock on Imperial Tobacco should be towards the upside.

So for those really looking at buying into the stock, again the 200 simple moving average is generally a good target to have even though it has not really had such a clear influence on this individual stock. But it's a very important moving average used by a lot of market technicians.

So for people looking to buy the stock, wait for any down move on light volume to take advantage of the market volatility in your favour. Place stops below the recent low and target a move back up to about £19.

So, just have a quick overview on Imperial Tobacco. The recent low was formed on positive divergence on the stochastic and the RSI. We've actually now got a buy signal on the MACD as well. This is generally considered a defensive stock. What you can find is when the market performs poorly defensive stocks actually do quite well, generally, not falling as much as the market, but also can perform positively on those days as equity traders move out of high beta stocks and into defensive positions.

So for those looking to buy into Imperial Tobacco, look for any down moves on light volume, placing your stops around £17.25, so that's just below the recent low, looking for a move back up towards the 200 simple moving average.

I've been Steven Mayne from Equitrade. Thank you very much for watching CantosCharts. Hope to see you soon.