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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 5838 ( -255 or -4.19% )
Last week the ASX put in an important reversal and now the ball is in the buyers’ court. Can they rally from here or do we go lower?.
VOLATILITY ALERTS:
Tue 11:30 – Monetary Policy Meeting Minutes
Thu 11:30 – Unemployment Rate
Fri 11:30 – Retail Sales (monthly)
For a continued move higher we must now see the ASX hold above 5746 followed by a move higher into 5985. Should this occur we will look for a move into 6020.
If the ASX cannot hold above 5746, we will look for a move back down to 5590. A strong break and close below this level could see the ASX move lower into 5408; and any break of this level could see a sharp retest lower into 5102.
EUROPE
DAX – 12016 ( -757 or -5.93% )
The DAX finds itself at key support to start this week following a big reversal last week. We are watching this market closely for any signs of failure.
For a move to the upside we must see the DAX hold above 11875. Should this occur we will look for a retest of 12115. If the DAX can break strongly through this level, we will look for a move into 12384 and if momentum is very strong we cannot rule out a strong move to 12566.
If the DAX fails to hold above 11875, we will look for a move back down to 11755 before a pause. Any break below this level however could see the DAX sell-off sharply into 11366, and if momentum is very strong to the downside we cannot rule out a move back down to 11050.
US
SP500 – 3037 ( -150 or -4.71% )
The S&P has sold off aggressively off a very big area and the start of this week should prove to be pivotal. We will be discussing this in the MEMBER PORTAL this week.
VOLATILITY ALERTS:
Tue 22:30 – Retail Sales (monthly)
Wed 00:00 – FED Chair Powell Testifies
Wed 22:30 – Building Permits
Thu 02:00 – FED Chair Powell Testifies
Thu 22:30 – Philly FED Manufacturing Index
Sat 03:00 – FED Chair Powell Speaks
For a move higher, we would like to see the S&P hold above 2998. Should this occur we will look for a move into 3140. A strong break above this level could see this market rally strongly to 3210.
If we cannot hold above 2998, we could see this market sell-off into 2902. 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 – 0.6867 ( -100 or -1.44% )
The Aussie Dollar has clipped the 70c handle and since reversed. Will we see more sellers this week?.
VOLATILITY ALERTS:
Tue 11:30 – Monetary Policy Meeting Minutes
Thu 11:30 – Unemployment Rate
Fri 11:30 – Retail Sales (monthly)
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 0.6873, and if upside momentum remains very strong, we may see a push higher into 0.7014 before a pause.
If the AUD cannot hold above 0.6762, we could see this market break lower and retest 0.6592. A close below this level could see a move to 0.6456.; and if momentum to the downside is very strong, a move back down to 0.6282 cannot be ruled out.
EUR/USD – 1.1259 ( -31 or -0.27% )
The EURO was sideways for most of last week with a topping pattern; as such our levels remain unchanged.
For a move higher we would like to see the EURO close above 1.1335 early in the week. Should this occur we could see a strong move into 1.1453 and any breaks above this level may mean a quick move into 1.1496 before a pause. A strong close above this level however could see the EURO rally strong into 1.1613 by the week’s end.
If the EURO cannot close above 1.1335, we could see a fast move down into 1.1249 before a pause. A strong break of this level may result in a move into 1.1201, however any weakness below this level could see a sharp drop into 1.1117 before the week’s end.
GBP/USD – 1.2541 ( -126 or -0.99% )
After starting the week higher Cable closed poorly as markets look forward to this week’s BoE meeting. We will be discussing this market again in the LIVE CHAT ROOM this week.
VOLATILITY ALERTS:
Tue 16:00 – Claimant Count Change
Wed 16:00 – CPI (annual)
Thu 21:00 – BoE Interest Rate Announcement
Fri 16:00 – Retail Sales (monthly)
For a continued move to the upside, we would like to see Cable close above 1.2720, followed by a retest of 1.2868 before a pause. Should this occur we will look for a move to 1.3035 and 1.3161; and if momentum is very strong we could see a re-test of 1.3191.
On the downside, should we fail to close above 1.2720, we will be watching the key level at 1.2622 very closely. Any weakness below this level however sets this market up for a move down into 1.2480. If momentum is very strong to the downside we cannot rule out a move to 1.2280 and 1.2080.
USD/JPY – 107.35 ( -223 or -2.04% )
The $/YEN was sold off aggressively on the back of $US weakness. Will we see a rebound this week?
VOLATILITY ALERTS:
Tue 12:00 – BoJ Interest Rate Announcement
Tue 12:00 – BoJ Press Conference
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 – 1729 ( +45 or +2.67% )
Gold continues to base in a sideways range and is again above 1700. Can this market breakout to the upside?
For a continued move higher we must now see this market hold above 1724. Should this occur we could see a strong move to 1755; and any break of this level could see a stronger move to 1786.
If Gold cannot hold above 1724, 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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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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