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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 6705 ( -33 or -0.49% )
With a big week in store for the ASX, will the start of a new month bring the bears out again? We will be discussing this in the MEMBER PORTAL this week.
VOLATILITY ALERTS:
Tue 11:30 – Building Approvals
Tue 14:30 – RBA Interest Rate Announcement, RBA Rate Statement
Tue 19:20 – RBA Governor Lowe Speaks
Thu 11:30 – Trade Balance
Fri 11:30 – Retail Sales, RBA Financial Stability Review
For a continued move higher we must now see the ASX hold above 6682. Should this occur, we will look for a test of 6804. If momentum to the upside continues we could see a retest of 6850, and if momentum is very strong we cannot rule out rule out a move to 7011.
If the ASX cannot hold above 6682, we will look for a move back down to 6635. A strong break and close below this level however could see the ASX retest 6544 before a pause; and if downside momentum is very strong, we could see a move down to 6435.
EUROPE
DAX – 12329 ( -75 or -0.6% )
The DAX printed its first down week in over a month. We have some very important technical levels we’re watching now and this will be another important week.
NOTE: Thursday is a public holiday in Germany (German Unity Day)
VOLATILITY ALERTS:
Mon 17:00 – German Prelim CPI (monthly)
Wed 03:30 – German Buba President Weidmann Speaks
For a continued move to the upside we must see the DAX close above 12374. Should this occur, we will look for a move off 12566 into 12714. If momentum is very strong, we could see a fast move to 12921.
If the DAX fails to close above 12374, we will look for a move back down to 12198. Any break below this level however could see the DAX sell-off sharply into 12000 this week.
US
SP500 – 2966 ( -20 or -0.67% )
As the US enters its 3rd week of consolidation, the question on everyone’s mind is have we seen a double top or is this market getting ready to break higher? We will be discussing this market in the LIVE CHAT ROOM this week.
VOLATILITY ALERTS:
Mon 23:45 – Chicago PMI
Wed 00:00 – ISM Manufacturing PMI
Fri 00:00 – ISM Non-Manufacturing PMI
Fri 22:30 – Non-Farm Employment Numbers – LIVE TV
Sat 04:00 – Fed Chair Powell Speaks
For a move higher we would like to see the S&P close above 2985. Should this occur, we will look for a move to 3003. A strong break above this level however sets the stage for a move higher into 3066.
If we cannot hold above 2985, we could see this market retest 2960. A break of this level however may result in quick move down to 2941; and if momentum to the downside remains strong we may see a fast move down to 2902.
FOREX
AUD/USD – 0.6765 ( +1 or +0.01% )
The Aussie Dollar traded much lower last week with yet another move down into an important level. We will be discussing this market in more detail in the LIVE CHAT ROOM.
VOLATILITY ALERTS:
Tue 19:55 – RBA Governor Lowe Speaks
For a move higher, we would first like to see the AUD hold above 0.6762. Should this occur, we will look for a retest of of 0.6875, and if upside momentum remains very strong, we may see a push higher into 0.6934 before a pause.
If the AUD cannot hold above 0.6762, we will look for a retest of 0.6706. A break and close below this level sets the stage for a larger move down to 0.6598; and if momentum to the downside is very strong, 0.6457 cannot be ruled out.
EUR/USD – 1.0941 ( -78 or -0.71% )
The Euro has closed below 1.1000 for the first time in over two years. We will be discussing the significance of this exclusively in the MEMBER PORTAL.
VOLATILITY ALERTS:
For a move higher this week, we would like to see the EURO close above 1.0977; followed by a break back above 1.1033. Should this occur, we could then see a move to 1.1197 before a pause; and if momentum is very strong to the upside we cannot rule out a move into 1.1249.
If the EURO cannot close above 1.0977, we could see a move down into 1.0902 before a pause. If this market continues to sell-off, we could see a sharp move down into 1.0814 by the week’s end.
GBP/USD – 1.2290 ( -179 or -1.44% )
Cable was also down last week but it too is approaching very important support.
VOLATILITY ALERTS:
Mon 18:30 – Current Account, Final GDP (quarterly)
Tue 18:30 – Manufacturing PMI
Thu 18:30 – Services PMI
For a continued move to the upside, we need to see Cable hold above 1.2195 followed by a close above 1.2297. Should this occur we will love for a move back up into 1.2389, and if momentum is very strong we could see a push higher into 1.2480
If the Pound cannot hold above 1.2195, we are likely to see a quick move down into 1.2000. A break below this level could see a fast move down to 1.1896, and if momentum is strong to the downside we could see a fast move down into 1.1800.
USD/JPY – 107.93 ( +38 or +0.35% )
The $/YEN sold off early in the week however closed strongly following a mid-week reversal.
For a move to the upside we must now see this market hold above 107.75, on its way to retesting 108.31 before a pause. A strong break and close above this level could then see the $/YEN rally into 109.21, and if momentum is very strong we could see moves to 109.94.
If we cannot hold above 107.75, we could see a fast move lower into 107.36. A break below this level may result in a retest of 106.52 before a pause; however any breaks below this level could mean a very sharp move down to 105.50.
COMMODITIES
GOLD – 1496 ( -20 -1.32% )
Last week we said “Gold continues to find support at key levels…” and this behaviour has yet to change. We will be discussing this market in detail in the LIVE CHAT ROOM.
For a continued move higher we must now see this market close above 1505. Should this occur, we will look for a move to 1526 ; and if momentum remains very strong, a strong break above this level could see Gold rally quickly into 1540 and 1552.
If Gold cannot close above 1505, we will look for a move back down into 1480. A strong break and close below this level could send this market lower into 1470, and if momentum is strong to the downside we cannot rule out a move lower into 1450.
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The views represented on this website do not contain (and should not be construed as containing) financial advice, recommendations, opinions in relation to acquiring, holding or disposing of a financial product of any kind, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Trade View Investments accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of the above information. Consequently any person acting on it does so entirely at his or her own risk. The research does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.
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