This market brief is an overview of the week ahead and some of the events we see as being important to the markets.
Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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We may take multiple trades throughout the week and discuss in our LIVE CHAT ROOM.
Trade View has entered the weekend Net Long.
AUSTRALASIA
ASX – 5880 ( – 111 or – 1.85% )
Last week saw a few attempts at breaking past 6000, but as soon as it did back down. As mentioned last week we still think the key levels are now 5790 on the downside and 6000 on the upside.
For the ASX to continue back higher we would like to see an early break and close past 5892 followed by a continuation of a long up bar reaching 5982, Once this is achieved we would like to see 5982 hold as a strong level of support before another break-through 6000 is made. Once this occurs we see the ASX reaching 6108 and possibly 6147.
If 6000 is it for the ASX then a continuation of the downside could be seen if 5892 becomes a solid level of resistance before a strong down bar breaks through 5842. Once this occurs then 5790 comes back into play and the only way we see this level broken is with strong momentum and a further long down bar. As mentioned previously “we still see 5790 playing an important role in the direction of this market” If the break does occur the next levels we will be watching are 5754, 5715 and if the move is strong then an extension towards 5636 is not out of the question.
EUROPE
DAX – 11869 ( – 151 or – 1.26% )
The DAX has taken another breather last week with a very significant day on Thursday as it created a very strong reversal bar. Also the DAX reached a low of 11623 which was only 2 points higher than our level of 11621 which was mathematically calculated.
For the upside move to take full effect we will keep last weeks levels in tact with a slight amendment to the upside. We would like to see a strong up bar break past 11984 before reaching 12164 and finally 12460.
If the downside has started then the second leg down could start if we see a strong long downbar break past 11791 reaching 11621 again. If 11621 is broken with strong momentum the DAX could find itself near the area between 11292 – 57 very quickly. Remember the DAX moves quickly, DON’T BLINK.
US
S&P – 2060 ( – 46 or – 2.18% )
In our DAX review we said “We feel that if these moves by the DAX are the real deal then the rest of the markets will need to catch up, either way get ready for some action over the next week or two.” and we saw it last week again. The S&P reached a high of 2115 which was only 3 points above our FICM level of 2112 and then down she goes back to a low of 2041.
For the S&P to continue higher we would like to see 2050 hold as a strong level of support before continuing back above 2076 with a long up bar. Once this occurs 2085 and possible 2101 could be seen. If the upward momentum is strong then 2112 will come into play once more.
For the down move to continue then another long down bar break past 2050 could see 2033 were the SPX might find temporary support but if the momentum is strong then we could see 2024 reached. If we are in a corrective mode then look out for 2010.
FOREX
AUD.USD – 7747 ( – 26 or – 0.33% )
The AUD tried to move higher early in the week but was not able to close above our level of 7927 as mentioned last week and then fell back down to close slightly lower. Therefore our comments remain the same.
For the up move to restart we would like to see the 7718 hold as a strong level of support before a strong push is needed to reach 7927. The only way we see 8088 is by a strong short squeeze.
For the downside move to continue we would like to see a strong down bar break past 7718 before a continuation down towards 7494 can be achieved. Once this occurs we could see 7407 and if the momentum is strong then 7263 could be seen.
EUR.USD – 10889 ( + 68 or + 0.63% )
Another attempt at breaking through 110 and then back down. Our comments from last week – “If the FED’s tone re raising rates changes then we could see a massive short squeeze as everywhere we turn, we hear traders being short the EUR.”
For the EUR to continue higher we would like to see another attempt at moving past 10899 followed by another attempt at breaking 11038. Dare I say if the upward momentum is strong we could see the EURO extend towards 113150 or even 11396?
For the downleg to continue its long term move we would like to see a strong break past 10780 reaching 10590. If the momentum is strong we could see 10452 tested. Further downside levels we will be watching are 10283, 10206, 10121, 10044.
GBP.USD – 14865 ( – 91 or – 0.61% )
Up and Down like a pinball machine the GBP bounces between two of our levels 14950 on the upside and 14832 on the downside. Are we starting to see Volatility back in the FX markets? We say Be Prepared!
For the GBP to restart its move higher we would to see 14950 broken early in the week followed by another aggressive push reaching 15140 again continuing towards 15209.
For the down move to restart then we would like to see another solid long down bar past 14832 before reaching 14563.
USD.JPY – 11912 ( – 91 or – 0.76% )
The USD continued lower again. Until the FED firms up its Interest rate rise this pair might be heading down in the near future.
For the USD to continue its long term rally we would like to see a strong long up bar break through 11931 early in the week followed by a continuous break past the area between 11991 – 12017 before a new attempt at breaking our key FICM level of 12064 is made. If the break is strong and has momentum then we could see 12184 and possibly 12275.
If the USDJPY restarts back lower then we would like to see strong early break and close past our key FICM level of 11867 before further downside breaks are made. If this is done with strong downward momentum then we will discuss it in our LIVE CHAT ROOM.
COMMODITIES
GOLD – 1198 ( + 16 or + 1.35% )
In the previous weeks brief we said “One note of caution, if the rate rise does not occur and the wording by the FED changes, be ready for a sharp reversal in many instruments, GOLD will be one of them.”
For the upward move to continue we would like to see another strong up bar break past 1208 before pushing through 1216 and 1226. Once this occurs then we could see 1241 and a possible extension reaching 1252 which would complete the range set back in Oct 2013.
For the down move GOLD will need to break an important level between 1178 – 80. If this occurs with a long down bar then it could continue down towards 1167 and settling near 1149 again.
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