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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 5402 ( +164 or +3.13% )
The ASX managed yet another higher close by week’s end despite it being contained within a larger range.
VOLATILITY ALERTS:
Tue 11:30 – NAB Business Confidence
Thu 11:30 – Unemployment Rate
For a continued move higher we must now see the ASX close above 5408 followed by a retest into 5590. Should this occur we will look for a move into 5746, and if momentum to the upside remains strong we cannot rule out a move to 5985.
If the ASX cannot close above 5408, we will look for a move back down to 5102. A strong break and close below this level could see the ASX retest lower into 4820.
EUROPE
DAX – 10923 ( +164 or +1.52% )
The DAX also continued to march higher following the lead set by world equity markets. Can this market continue higher? We will be discussing this in the MEMBER PORTAL this week.
VOLATILITY ALERTS:
Fri 16:00 – German Prelim GDP (quarterly)
For a move to the upside we must see the DAX hold above 10760. Should this occur we will look for a retest of 11050 . If the DAX can break strongly through this level, we will look for a move into 11366.
If the DAX fails to hold above 10760, we will look for a move back down to 10266 before a pause. Any break below this level however could see the DAX sell-off sharply into 10010, and if momentum is very strong to the downside we cannot rule out a move back down to 9690.
US
SP500 – 2937 ( +111 or +3.93% )
The S&P continues to rally higher in the face of continued bad news. Are the bulls or bears really in control here? We will be discussing this in the MEMBER PORTAL this week.
VOLATILITY ALERTS:
Tue 22:30 – CPI (monthly)
Wed 23:00 – Fed Chair Powell Speaks
Fri 22:30 – Retail Sales
Sat 00:00 – Prelim UoM Consumer Sentiment
For a move higher, we would like to see the S&P hold above 2902. Should this occur we will look for a move into 2998. A strong break above this level could see this market rally strongly to 2140.
If we cannot hold above 2902, we could see this market sell-off into 2870. If momentum to the downside is strong we may see a move lower into 2780; and a close below this level may result in a very fast move down to 2678.
FOREX
AUD/USD – 0.6530 ( +111 or +1.73% )
The Aussie Dollar is flirting with the all important 65c area again and this will be an important week for this market.
VOLATILITY ALERTS:
Tue 11:30 – NAB Business Confidence
Thu 11:30 – Unemployment Rate
For a move higher, we would first like to see the AUD hold above 0.6456. Should this occur, we will look for a retest of 0.6592, and if upside momentum remains very strong, we may see a push higher into 0.6692 before a pause.
If the AUD cannot hold above 0.6456, we could see this market break lower and retest 0.6282. If momentum to the downside is very strong, a move back down to 0.6092 cannot be ruled out.
EUR/USD – 1.0838 ( -142 or -1.29% )
The EURO is testing the lower end of its sideways range with important support to watch this week.
For a move higher, we would like to see the EURO close above 1.0902. Should this occur, we will look for a move to 1.1033; and if momentum is very strong we cannot rule out a move to 1.1117.
If the EURO cannot close above 1.0902, we could see a move back down into 1.0814. If this market continues to sell-off a move lower into 1.0652 is very possible; and if momentum is very strong to the downside we could see a fast and sharp move down into 1.0525.
GBP/USD – 1.2406 ( -87 or -0.7% )
Cable remained flat this week and once again we are on alert for a breakout. We will be discussing this market again in the LIVE CHAT ROOM this week.
VOLATILITY ALERTS:
Wed 16:00 – Prelim GDP (quarterly)
Thu 20:30 – BoE Governor Bailey Speaks
For a continued move to the upside, we need to see the Pound close above 1.2480. Should this occur we may see a move into 1.2720, and if momentum is very strong we cannot rule out further upside into 1.2868.
If the Pound cannot close above 1.2480, we could see a move lower back down to 1.2297. A break of this level however sets up for a move down to 1.2080; and if momentum to the downside is very strong 1.1896 cannot be ruled out.
USD/JPY – 106.63 ( -25 or -0.23% )
The $/YEN is finding support at the important 106 level and this market should be watched for any signs of further support here. We will be discussing this in the LIVE CHAT ROOM this week.
For a move to the upside we must now see this market close above 108.31. Should this occur we will look for a retest of 109.21, and if momentum is very strong we could see a move higher into 109.94 and potentially 111.73.
If we cannot close above 108.31, we could see a move lower into 106.52. A break below this level may result in a sharp move lower into 105.50; and any further breaks to the downside may see a bigger move into 104.97.
COMMODITIES
GOLD – 1701 ( +2 or +0.12% )
Gold continues to trade in a sideways range and once again we are on high alert for a breakout opportunity.
For a continued move higher we must now see this market hold above 1687. Should this occur we could see a retest of 1724; and any break of this level could see a stronger move into 1755 and 1786.
If Gold cannot hold above 1687, we will look for a move back down to 1674. A break below this level could see a move lower into 1648; and if momentum is very strong to the downside we could see a move to 1605.
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