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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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
ASX – 5696 ( -46 or -0.8% )
The ASX continues within its tight range and again we remain on alert for a big breakout. We will be discussing this market exclusively in the LIVE CHAT ROOM.
VOLATILITY ALERTS:
Tue 11:30 – Monetary Policy Meeting Minutes
Wed 11:30 – Wage Price Index (quarterly)
Thu 11:30 – Unemployment Numbers
For a continued move higher we would like to see the ASX close and hold above 5671 and close above 5746. Should this occur we will look for a retest of 5777, and a strong close above this could result in a quick move to 5823. If momentum is strong we will then look for a rally into 5875 and 5921.
If the ASX cannot close and hold above 5671, we are likely to see a strong move down into 5648. A close below this level may result in more selling into 5606 and if momentum is very strong a move down into 5582 and 5521 cannot be ruled out.
EUROPE
DAX – 11999 ( -286 or -2.33% )
The DAX is showing signs of increased volatility and we are now approaching some very big support levels. We will be discussing this market further this week in the MEMBER PORTAL.
VOLATILITY ALERTS:
Tue 16:00 – German Prelim GDP (quarterly)
Wed 19:00 – Euro Area Flash GDP (quarterly)
Thu 21:30 – ECB Monetary Policy Meeting Minutes
For a continued move to the upside we must now see the DAX close above 12044. Should this occur we will look for a move back up to 12115 and 12198. A strong break of this level could see the DAX rally quickly to 12384.
If the DAX fails to close above 12044, we are likely to see a move down into 11875. Below this we have key support between 11755 – 11790. However should these levels break be prepared for a potentially strong move down into 11519.
US
SP500 – 2441 ( -33 or -1.33% )
Last week saw volatility return to the S&P as geopolitical uncertainty continues to grip this market. Is volatility here to stay?
VOLATILITY ALERTS:
Tue 22:30 – Retail Sales
Wed 22:30 – Building Permits
Wed 22:30 – Housing Starts
Thu 04:30 – FOMC Meeting Minutes
Sat 00:00 – Prelim UoM Consumer Sentiment
For a move higher we would like to see the S&P hold above our key level at 2418, followed by a strong break and close above 2440. Should this occur we anticipate further upside over the coming week. A strong break of 2440 could see retests of 2465 and 2477.
If we cannot hold above 2418, we will look for a move to retest of strong support at 2400. A strong break below this level could see the S&P spike down 2392, and a close below this level could see this market trade 2386 by week’s end.
FOREX
AUD/USD – 0.7893 ( -36 or -0.45% )
The Aussie dollar weakened slightly as a small pullback ensued last week.
VOLATILITY ALERTS:
Tue 11:30 – Monetary Policy Meeting Minutes
Wed 11:30 – Wage Price Index (quarterly)
Thu 11:30 – Unemployment Numbers
For a move higher we must now see this market close above 0.7903, followed by a strong break and close above 0.7988. Should this occur we will look for this market to test 0.8034. A strong break and close above 0.8034 could see this market post further gains into 0.8118.
If we cannot close above 0.7903, we could see the AUD retest 0.7833. Should we break lower however, we will look for a move back into 0.7779 and if downside momentum continues we could see 0.7729 quickly before another pause.
EUR/USD – 1.1821 ( +50 or +0.42% )
With no follow-through to the downside on the EURO markets will be looking to the key ECB minutes this week. We will be discussing this in more detail in the LIVE CHAT ROOM.
NOTE: Tuesday is a holiday in France and Italy (Assumption Day)
VOLATILITY ALERTS:
Wed 19:00 – Euro Area Flash GDP (quarterly)
Thu 21:30 – ECB Monetary Policy Meeting Minutes
For a sustained move higher we would like to see the EURO hold above 1.1738 and close strongly above 1.1834. Should this occur we could see a strong move into 1.2042.
If the EURO cannot hold above 1.1738, we will look for a move back down into 1.1678. A break below this level will likely result in a move to 1.1613; and should momentum remain strong to the downside a move to 1.1496 cannot be ruled out.
GBP/USD – 1.3009 ( -28 or -0.21% )
The GBP was down slightly however our levels remain unchanged.
VOLATILITY ALERTS:
Tue 18:30 – CPI (yearly)
Wed 18:30 – Unemployment Numbers
Thu 18:30 – Retail Sales
For a continued move to the upside, we would like to see Cable break above 1.3035. Should this occur we will look for the Pound to rally into 1.3277 before a pause. A break of this level is very likely to see the GBP/USD test 1.3309, and if momentum is very strong we will look for a move to 1.3534.
If we fail to break and close above 1.3035, we will look for a move back down to 1.2868. A break below this level could then see this market trade back into 1.2720 before a pause. If momentum is strong and we break and close below 1.2720, we could see a sharp move lower into 1.2600.
USD/JPY – 109.15 ( -152 or -1.37% )
The $/YEN continues to struggle on the back of a weak $US and we are now at a very big area. We will be discussing this in more detail in the LIVE CHAT ROOM.
VOLATILITY ALERTS:
Mon 09:50 – Prelim GDP (quarterly)
For a move to the upside we will look for this market to hold above our key level at 108.31, followed by a strong break and close above 109.21. Should this occur we will look for a move back up to 109.94 before a pause. If momentum remains strong to the upside, we will look for a move to 111.09 before the week’s end.
If we cannot hold above 108.31, the YEN may see further downside into 107.75. A strong break and close below this level could spell trouble for the YEN, with a very fast move down to 105.45.
COMMODITIES
GOLD – 1289 ( +31 or +2.46% )
GOLD is again in rally mode as markets look for a safe-haven amidst global uncertainty.
For a continued move higher we would like to see this market hold above 1278, followed by a retest of 1294. A strong break above 1294 could see this market head back up to 1303, and if momentum remains strong we could see a move into 1313 before another pause.
If Gold cannot hold above 1278, we will look for a strong move back down into 1263 and 1257. A break and close below this level could then result in a move to 1247 before the week’s end.
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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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