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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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We may take multiple trades throughout the week. Currently Trade View is Light Net Long.
AUSTRALASIA
ASX – 5311
The ASX continues to find it difficult to move higher, even though some of the other Indices have been reaching new all time highs. One thing to note is that it is sitting near the highs of September and October.
For the up move to restart, we would like to see and early break past 5335 followed by a solid break past 5368. Once this level is broken then we will look for solid long bars to break through the 5407 – 24 area before seeing the ASX push towards 5488.
If the ASX is to continue the down move, we would like to see a break past 5276 early in the week, followed by a stronger move down past 5248. Once this is achieved we will be watching 5201, but if this too is broken with long solid long down bars then we will look towards 5144 – 26 area for temporary support on the ASX.
EUROPE
FTSE – 6638
Not much has changed on the FTSE front as it continues its sideways move. Even though it has closed below 6657 and 40 points lower than last week’s close our view from last week remains.
For the upmove to restart, we would like to see an early break back past 6657 then 6715, followed by strong long up bars breaking through and closing above 6740. If this is achieved and the momentum is strong then the area between 6784 – 6817 may be tested.
For the down move to continue we would like to see 6657 become a solid level of resistance. If this is achieved then 6609 could be the next level, and if 6609 is broken then possibly 6562. If the downward move is strong and continues past this area, we could see 6450 – 32 reached, which would complete the range set in August.
DAX – 9400
The DAX again created new highs reaching 9425 and has now completed the new range set in September. The question is how long can this run last?
With the S&P and the DAX both at new all time highs, and the full range being met we will not be projecting upper targets at the start of this week, but may post more information about our view of it in our members area if new upside breaks occur past 9547.
If the DAX takes a breather, then we would like to see solid break back down past 9257 early in the week. Once this level is broken then 9188 will be the next level to watch. Following this if we see a break past 9117 this could lead the way to 9076 being reached, and if this level is broken, we could see 9001 as a last ditch effort for support before the DAX dips into the 8000 territory again.
US
S&P – 1805
Another all time intraday high for the S&P of 1813. Is this enough to push the Index much higher once the US traders come back from their long weekend holiday. Therefore our comments from last week remain the same.
As we are at new all time highs and have broken the previous range, we will be looking for a solid break up early in the week to see if the momentum continues. If so, then the 1845 – 48 area will be the next target which will complete the medium term range that was set back in August and September. We will revise if this area is met and provide further analysis of the S&P in our member’s area.
If we have seen the highs for the S&P and a new down move starts, then we would like to see a solid move past both 1780 and 1771 before reaching 1740. If this occurs and the momentum is strong we will revise downside targets.
NASDAQ – 3490
The NASDAQ is trying very hard to lead this market and it seems it’s doing a pretty good job at it with another strong rally last week.
If the up move is to continue, then we would like to see a solid break and close past 3542 with long up bars. Once this level is broken we will revise any further upper targets.
If the NASDAQ finds itself heading back down, then we would like to see a solid break back past 3457 which could lead it to reach 3420. If this is then broken we could see 3398 which would be the bottom of the new Standard Deviation Channel formed. If this too is broken with solid long down bars we could then see 3323 reached.
FOREX
AUD.USD – 9107
The AUD has taken another leg down and broke the range mentioned last week.
For a new upmove to start we would like to see an early break past 9188 followed by a solid break past 9256 which could lead the pair to reach 9306. If this too is broken the 9371 could be the next test before 9400 is reached.
If the downtrend continues in the same fashion as the previous week’s, then a solid break past 9083 could start the move down towards 9011. If this level is broken and 9824 does not provide any support, then this could be the formation of a prolonged down move.
EUR.USD – 13590
The EUR is continuing higher even though the USD is showing signs of strength and going against the policy maker’s wishes who are doing their very best to keep it lower.
For the EUR to continue its move higher, we would like to see an early break past 13637 before reaching the area between 13710 – 42. If this area is then broken with long solid up bars we could see an ambitious level of 13854 reached.
As mentioned last week, if the USD continues its strength and the EUR finally decides to give in, then a solid break down past 13554 and 13515 could lead the way down to 13433. If this level is broken then 13337 could be reached, and if the down moves are strong we could see an ambitious lower target of 13263.
GBP.USD – 16359
The GBP took an extra leg up last week and just did not want to stop. Trade View will be watching closely, as if this pair is overpriced and the USD finds strength, then some big moves could be just around the corner.
If the GBP continues to move higher, we would like to see 16427 broken with solid long up bars which could lead it to reach 16481 which would complete the range. Revisions will be made after this level is broken.
For the down move to restart then we would like to see a break past 16260 followed by a strong break with solid long down bars through 16114 which could lead the pair back down near 16028 – 21 area which might be a first level of support.
USD.JPY – 102.36
The USD rallied strong against the JPY last week and the full range of 102.51 was met with a high of 102.61. It’s important to note that we are now on a FICM potential resistance line that will be watched closely.
If we are to see a continuation of the up move then we need to see a solid break and close above 102.51 early in the week to enable the pair to reach 103.73. If this level is then broken we will need to re-adjust our upper projections as all ranges have been met.
If 102.51 proves to be difficult to break and we see a downward move restart, then we would like to see 101.98 broken before a solid move down to 101.09 is achieved. If this level is also broken then 100.52 will come into play once more.
COMMODITIES
GOLD – 1251
At the moment GOLD is finding it difficult to find any upward momentum. Last week we saw a sideways move and this week our comments remain the same.
If GOLD is to have any chance of moving higher then we need to see a strong break past 1265 – 68 area before we see 1282. Once 1282 is broken, then 1320 could be seen. The area between 1320 – 36 could be tough to break.
If the down move continues, then a solid break past 1210 early in the week could lead the way to GOLD dipping below 1200 again and reaching 1179. If this too is broken then 1137 would complete the downward range.
US LIGHT CRUDE OIL – 92.76
Both GOLD and OIL are having as difficult time at the moment and there appears to be a lack of confidence in both of them.
For OIL to move higher and possibly restart a new uptrend then we would like to see 93.47 and 94.55 broken with long solid up bars. Once broken they need to hold as solid support. If we see this then another break past 95.64 needs to occur. Once this is broken with solid upward momentum then we could see 96.56 reached and eventually 97.44.
If there is more to this down move than first thought then a solid break past 91.46 could start the lead to more defined breaks. The levels we will be watching are 90.19, 88.22 and 85.67 and the speed of the downward momentum will dictate where OIL will find support.
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