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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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INDICES
AUSTRALASIA
ASX – 6280 ( +20 or +0.32% )
The ASX managed to grind higher however Friday’s reversal sets up for a very interesting week this week.
VOLATILITY ALERTS:
Tue 11:30 – Building Approvals (monthly)
Thu 11:30 – Trade Balance
Fri 11:30 – Retail Sales (monthly)
For a continued move higher we must now see the ASX hold above 6276. Should this occur we will look for a move into 6345, and if momentum to the upside is very strong we cannot rule out a move to 6440.
If the ASX cannot hold above 6276, we will look for a move back down to 6206 before a pause. A strong break and close below this level however could see the ASX retest 6140, and if downside momentum is very strong we could see a move down to 6070.
EUROPE
DAX – 12822 ( +280 or +2.23% )
The DAX performed strong last week as it held two of our key levels at 12566 and 12714. We will be discussing this in more detail in the LIVE CHAT ROOM.
VOLATILITY ALERTS:
Mon 17:00 – German Prelim CPI (monthly)
Tue 16:00 – German Retail Sales (monthly)
For a continued move to the upside we must now see the DAX close above 12921 followed by a retest of 13050. Should this occur we will look for a strong move into 13205, and if momentum remains strong a push back higher into 13301.
If the DAX fails to close above 12921, we may see a retest back down into the key level of 12714. A close below this level is likely to see a retest of 12600 and 12566; however if momentum is very strong to the downside we cannot rule out a strong move to 12384.
US
SP500 – 2816 ( +14 or +0.5% )
The S&P also managed to close higher despite a volatile earnings week. This week is also a very key week for this market and we will be discussing this in more detail in the LIVE CHAT ROOM.
VOLATILITY ALERTS:
Tue 23:45 – Chicago PMI
Thu 00:00 – ISM Manufacturing PMI
Thu 04:00 – FOMC Interest Rate Announcement
Fri 22:30 – Non-Farm Payrolls – LIVE TV
Sat 00:00 – ISM Non-Manufacturing PMI
For a move higher we would like to see the S&P hold above 2808. Should this occur we could see another retest of the key area at 2838-2840. A close above this level however sets the stage for a retest of 2870.
If we cannot hold above 2808, we will look for a move back down to 2794. A break below this level however may result in a quick move down to 2785; and if momentum to the downside is very strong we could see a move into 2760.
FOREX
AUD/USD – 0.7401 ( -16 or -0.22% )
The Aussie Dollar continues within its sideways range and we may now be approaching a decision point for this market.
VOLATILITY ALERTS:
Tue 11:30 – Building Approvals (monthly)
Thu 11:30 – Trade Balance
Fri 11:30 – Retail Sales (monthly)
For a move higher we would like to see the AUD close above 0.7447, followed by a break and close above 0.7489. A strong break and close above this level could see a quick move to 0.7561 before a pause; and if momentum remains strong we will look for a move into 0.7617.
If we cannot close above 0.7447, we will look for a move back down to 0.7364. A strong break below this level may result in a move back down into 0.7282 before another potential pause. Any subsequent breaks of this level however may result in a very fast move down to 0.7229.
EUR/USD – 1.1657 ( -64 or -0.55% )
Like the Aussie Dollar, the Euro also remains in a larger sideways range; and we are on alert for a breakout move.
VOLATILITY ALERTS:
Mon 17:00 – German Prelim CPI (monthly)
Tue 16:00 – German Retail Sales (monthly)
Tue 19:00 – CPI Flash Estimate (annual)
Tue 19:00 – Prelim Flash GDP (quarterly)
For a sustained move higher we would like to see the EURO close above 1.1738 this week. Should this occur we could see a strong move into 1.1822; whilst a strong break above this level may see a run into the big figure at 1.2000.
If the EURO cannot close above 1.1738, we could see a fast move down into 1.1613. A break below this could be followed by another quick move into 1.1496; and should momentum remain strong we cannot rule out a move to 1.1453.
GBP/USD – 1.3101 ( -28 or -0.21% )
Is this the week the Pound has been waiting for? With the BoE set for one of the year’s most important Interest Rate Meetings, all eyes will be on what the BoE says regarding the state of the UK economy. We will be covering this market extensively in the the MEMBER PORTAL.
VOLATILITY ALERTS:
Wed 18:30 – Manufacturing PMI
Thu 18:30 – Construction PMI
Thu 21:00 – BoE Interest Rate Announcement – LIVE TV
Fri 18:30 – Services PMI
For a continued move to the upside, we would like to see Cable close above 1.3111. Should this occur we will look for the Pound to rally into 1.3309 before a pause; however a strong break of this level could see a retest of 1.3534.
If we cannot close above 1.3111, we could see the Pound breakdown quickly into 1.3035. Any subsequent break could see this market sell-off quickly into 1.2868, and should the downside momentum continue, we cannot rule out a move to 1.2720.
USD/JPY – 110.99 ( -46 or -0.41% )
As the $/YEN continues to fall, markets will be looking to see whether the bulls can regain their footing and step in to support this market this week. Or will we see further declines?
VOLATILITY ALERTS:
Tue 12:30 – BoJ Interest Rate Announcement
For a move to the upside we must now see this market close above 111.73. Should this occur we will look for a test of 112.68 before another pause. However a strong break and close above this level could see the YEN rally strongly into 113.87.
If we cannot close above 111.73, we are likely to see a retest of 110.45. A break of this level however may result in a sharp move down into 109.94; and if momentum to the downside is very strong we cannot rule out a move to 109.21.
COMMODITIES
GOLD – 1222 ( -9 or -0.73% )
GOLD is trying to form a base here however buyers beware- any break to the downside is likely to be very sharp.
For a move higher we would like to see this market hold above 1222 on its way to re-testing 1238. Should this occur we will look for a retest of 1247. A close above this level may likely see a further move to the upside into 1260 before a pause. Should momentum remain very strong, we could see a fast move into 1276.
If Gold cannot close above 1238, we could see another sharp decline into 1216. Any subsequent breaks of this level may result in further downside into 1206, and if momentum to the downside remains very strong we cannot rule out a move into 1187.
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