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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes. For up to the minute market analysis see our live trading room.
INDICES
AUSTRALASIA
ASX – 5964 ( +116 or +1.98% )
The ASX was slightly higher last week having found support once again at a key area.
For a continued move higher we must now see the ASX hold above 5921 followed by a push into 6070. Should this occur we will look for a move into 6140, and if momentum to the upside remains strong we cannot rule out a move to 6206 and 6276.
If the ASX cannot hold above 5921, we will look for a move back down to 5823 before a pause. A strong break and close below this level however could see the ASX retest 5746, and if downside momentum is very strong we could see a move down to 5614.
EUROPE
DAX – 12575 ( -543 or -4.14% )
As the bulls struggled to take the DAX higher, last week we saw sellers enter the market aggressively on Monday and we have been in a holding pattern since. We will be discussing this in our LIVE CHAT ROOM this week.
VOLATILITY ALERTS:
Mon 23:45 – ECB President Lagarde Speaks
Wed 17:20 – ECB President Lagarde Speaks
For a continued move to the upside we must now see the DAX hold above 12566. Should this occur, we will look for a strong move into 12714, and if momentum remains strong a push back higher into 13050.
If the DAX fails to hold above 12566, we may see a retest back down into the key level of 12266. A close below this level is likely to see a retest of 12166; however if momentum is very strong to the downside we cannot rule out a move to 11871.
US
SP500 – 3295 ( -31 or -0.93% )
The S&P was slightly lower and this week is shaping up to be yet another pivotal week. We will be discussing this in the MEMBER PORTAL this week.
VOLATILITY ALERTS:
Wed 00:00 – CB Consumer Confidence
Wed 22:30 – GDP (monthly)
Wed 23:45 – Chicago PMI
Thu 00:00 – Pending Home Sales (monthly)
Fri 00:00 – ISM Manufacturing PMI
Fri 22:30 – Non Farm Employment
Sat 00:00 – Revised UoM Consumer Sentiment
For a move higher we would like to see the S&P hold above 3248. Should this occur, we will look for a move higher into 3308. A strong break above this level however sets the stage for a move higher into 3338; and if momentum is very strong we cannot rule out a move to 3375.
If we cannot hold above 3248, we could see this market move lower into 3208. A break of this level however may result in a quick move down to 3166; and if momentum to the downside remains strong we may see a fast move down to 3106.
FOREX
AUD/USD – 0.7024 ( -267 or -3.66% )
The Aussie Dollar has finally broken out to the downside and whilst this move was not unexpected; the question now is can this market settle here? We will be discussing this market again in the LIVE CHAT ROOM this week.
For a move higher, we would first like to see the AUD hold above 0.7014. Should this occur we will look for a move into 0.7113, and if upside momentum remains very strong we cannot rule out a move to 0.7197 – 0.7236 before a pause.
If the AUD cannot hold above 0.7014, we will look for the AUD to 0.6934. A break and close below this level however could see a sharp decline into 0.6830; and if momentum to the downside remains strong we cannot rule out a move into 0.6750.
EUR/USD – 1.1630 ( -212 or -1.79% )
The EURO was also weaker last week as the focus shifts away from this market and back to the $US.
VOLATILITY ALERTS:
Mon 23:45 – ECB President Lagarde Speaks
Wed 17:20 – ECB President Lagarde Speaks
For a move higher we would like to see the EURO hold above 1.1613. Should this occur we could see a continued move higher into 1.1678. A break of this level could see this market rally further to 1.1738 and if momentum is very strong, 1.1840 cannot be ruled out.
If the EURO cannot hold above 1.1613, we could see a fast move down into 1.1496 before a pause. A strong break of this level may result in a move into 1.1453, however any weakness below this level could see a sharp drop into 1.1347.
GBP/USD – 1.2743 ( -173 or -1.34% )
Cable is showing signs of basing and it will be interesting to see if the buyers can step in this week. We will be discussing this in the LIVE CHAT ROOM this week.
VOLATILITY ALERTS:
Thu 18:30 – Final Manufacturing PMI
For a continued move to the upside, we would like to see Cable close above 1.2868, followed by a move higher into 1.3035 before a pause. If however momentum is very strong we may see a strong push into 1.3161 and 1.3277 by the weeks’ end.
Should we fail to close above 1.2868, we could see a move back down to the all important 1.2720. A break below this level however could see Cable further depreciate to 1.2622 by the week’s end; and if momentum is very strong to the downside 1.2480 cannot be ruled out.
USD/JPY – 105.56 ( +101 or +0.97% )
The $/Yen was stronger as expected and all eyes will be on this market this week. We will be discussing this in the MEMBER PORTAL this week.
For a move to the upside we must now see this market hold above 104.97. Should this occur we will look for a retest of 105.50, and if momentum is very strong we cannot rule out a move all the way back up to 106.82.
If we cannot hold above 104.97, we could see another move back down into 104.02. A break below this level may result in further downside to 103.21; and any further breaks to the downside may trigger a bigger move into 103.21.
COMMODITIES
GOLD – 1860 ( -90 or -4.62% )
Last week GOLD broke to the downside and the question on everyone’s mind is can this market hold the all important 1850 and 1800 levels?
For a continued move higher we must now see this market hold above 1830. Should this occur we would then need to see a strong break back above through 1872. Should this occur we could see further upside into 1900 and 1920.
If Gold cannot hold above 1830, we will look for a move back down to 1800. A break below this level could see a move lower into 1786; and if momentum is very strong to the downside we could see a move to 1755.
