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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 and discuss in our LIVE CHAT ROOM.
Trade View has entered the weekend Light Net Long.
NOTE: The SNB decision on Thursday has thrown a spanner in the works for the world FX markets. We have seen some brokers go insolvent and others being bailed out with massive $300 mill injections. The true reasoning and the real impact for the SNB decision could be seen this week with the ECB meeting on the 22nd. We feel that these events will play a very important role moving forward, therefore we will be very cautious this week.
Some Article’s for your Reference:
http://www.bloomberg.com/news/2015-01-17/swiss-franc-trade-is-said-to-wipe-out-everest-s-main-fund.html
http://www.bloomberg.com/news/2015-01-16/fxcm-tests-no-such-thing-as-bad-publicity-after-snb-franc-move.html
http://www.bloomberg.com/news/2015-01-15/new-zealand-currency-broker-closes-on-losses-after-swiss-shock.html
AUSTRALASIA
ASX – 5359 ( – 64 or – 1.18% )
The ASX moved higher over the holiday break but now is back down and has closed lower for the week. We did see a strong rally on Friday but will need to see if this continues
For the up move to continue from Friday we need to see another long up bar break and close above our Key FICM level of 5367. Once this occurs we would like to see further long up bars break 5418 eventually finding short term resistance near 5448 – 63.
For the down move to restart we would like to see an early break with a long down bar through the area between 5330 – 12. This could then lead the ASX towards 5270 and possibly 5217.
EUROPE
DAX – 10276 ( + 611 or + 6.32% )
The events of last week saw the DAX move almost 500 points on one day and over 6% for the week. We have mentioned previously that the DAX will steam ahead many times. If it is correct then the rest of the markets will follow, otherwise the DAX will revert back down quickly. We are now at ATH’s again.
For the up move to continue this week we would like to see how last weeks events unfold. Once we have a clearer picture we will discuss it in our LIVE CHAT ROOM.
If the DAX has moved up to fast and if the downside restarts then we would like to see a strong break past 10258 before reaching 10146. Once this level is broken the DAX could find some temporary support near 10075 – 35.
US
S&P – 2019 ( – 22 or – 1.08% )
The S&P reached an ATH just before the end of the new year and then it fell away very quickly. It has struggled to move higher ever since and last week was no exception, but then Friday came and another strong move higher. Even so the SPX has closed lower for the week.
For the up move to continue we would like to see a strong early break and close past 2024 followed by a move towards 2053. Once this level is broken the area between 2088 – 92 could come into play again.
For the down move to re-start we would like to see a strong break and close below 2010 reaching 1990 and 1981. If the downward momentum continues strong we could see the SPX break through the area between 1957 – 47 on its way down towards 1927.
FOREX
AUD.USD – 8226 ( + 24 or + 0.29% )
Last year we said “The AUD seems to be going through the motions at the moment, moving up and down during the week. We still feel the AUD has nothing to offer.” Not much has changed for now.
For the up move to restart we would like to see and early break back above 8378 before reaching 8461. once this level is broken then we could see 8563 again.
Another move down by the AUD could start if we see an early break past 8284. This could then see the pair near 8139 very quickly.
EUR.USD – 11561 ( – 281 or – 2.37% )
The EUR has completely fallen off a cliff with the ECB looking to launch QE. If they disappoint on the 22nd then maybe we could see a reversal of trend very quickly. Caution should be observed. Basically “NO MORE TALK DRAGHI, IT’S TIME FOR ACTION”.
If the EUR is to have any chance for an upmove then we would like to see an early break and close back past 11726 before reaching 11865.
For the down move to take another leg down it would all come down to how big the QE will be. This will then guide the levels. As we are in the business of mathematically calculating price levels, until the 22nd we will not provide downside targets.
GBP.USD – 15137 ( – 19 or – 0.13% )
The GBP took another leg lower over the New Year and has now settled in its slow sideways moves before it decides on the next leg, otherwise we could see a wide range for a few weeks maybe months.
For the GBP to move higher we would like to see a solid break and close back above 15280 before reaching 15366. If the upward momentum is strong then 15522 will play an important role.
If the GBP moves lower we would like to see a break past 15074 and 15034 before taking another leg lower through 14999 with a long down bar reaching 14832.
USD.JPY – 11756 ( – 97 or – 0.82% )
After a stellar performance last year this pair has taken a bit of a breather.
For the USD to rally again we would like to see a strong break past 11813 before a strong push can be made towards 11931. Once this level is broken with a long up bar then we could see 12064.
If the USDJPY continues lower then a strong break past 11679 could set off a chain reaction through 11543 reaching 11471.
COMMODITIES
GOLD – 1279 ( + 57 or + 4.66% )
It looks like Traders are looking for Safe haven plays. GOLD is possibly coming back into fashion after last weeks events.
For the upward move to continue then we would like to see an early break and close back above 1295 which will then help GOLD push past both 1308 and 1329 on its way towards 1351 with strong momentum.
For GOLD to return lower we would like to see a strong break and close past 1274 before reaching 1263. Once this is broken then we could see GOLD find some support near 1252 – 41. If no support is found we could be back in the low 1200’s very quickly..
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