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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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OCTOBER 2017 – FULL
NOVEMBER 2017 – FULL
INDICES
ASX – 5910 ( +87 or +1.49% )
The ASX posted another strong week last week following positive unemployment numbers. This week we begin to approach key resistance and will be discussing this in the LIVE CHAT ROOM.
VOLATILITY ALERTS:
Wed 11:30 – CPI (quarterly)
For a continued move higher we would like to see the ASX hold above 5875, followed by a strong break through our key level at 5921. Should this occur, we will look for a move to 5985 before a pause. If momentum to the upside is strong we could see a very strong move to 6070.
If the ASX cannot hold above 5875, we will look for a move back down to 5823. A break of this level could see a move back down to 5777 and continued downside may see a move lower into 5746.
EUROPE
DAX – 12992 ( -6 or -0.05% )
The DAX spent the majority of last week trying to break above our key level of 13,500 and closed below the major 13,000 level.
VOLATILITY ALERTS:
Tue 18:30 – German Flash Manufacturing PMI
Tue 18:30 – German Flash Services PMI
Wed 19:00 – German Ifo Business Climate
Thu 22:45 – ECB Interest Rate Announcement – LIVE TV
For a continued move to the upside we must continue to see the DAX hold above 12921. Should this occur we will look for a retest of 13050 before a pause. If momentum continues to be very strong this week we will look for a move to 13205.
If the DAX fails to hold above 12921, we will look for a move back down to 12882. A close below this level however could see the DAX lower into 12714; and if momentum is very strong we cannot rule out a move to to the downside 12566.
US
SP500 – 2576 ( +22 or +0.86% )
We said it last week: ‘The S&P is the gift that keeps on giving’. Now that the Senate has all but passed Trump’s tax plan, will we reach our 2590 target this week? We will be discussing this in more detail in the LIVE CHAT ROOM.
VOLATILITY ALERTS:
Wed 23:30 – Core Durable Goods Orders (monthly)
Thu 01:00 – New Home Sales
Fri 01:00 – Pending Home Sales
Fri 23:30 – Advance GDP (quarterly)
For a move higher we would like to see the S&P hold above 2574. Should this occur we will look for a move higher into 2590. If momentum is very strong and we break through 2590 easily, we cannot rule out a fast move to 2628.
If we cannot hold above 2574, we will look for a move back down to 2562. A break below this may likely see a retest of 2550 and 2540, and if momentum is very strong on the downside we could see a sell-off into 2524.
FOREX
AUD/USD – 0.7813 ( -75 or -0.95% )
The ASX spent most of last week drifting lower and things are becoming very interesting at our important 0.7833 level.
VOLATILITY ALERTS:
Wed 11:30 – CPI (quarterly)
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 0.7833, we are likely to see a move lower into 0.7779. Should the downside momentum continue we could see 0.7729 quickly before another pause; and if selling pressure is strong a move into 0.7662 cannot be ruled out.
EUR/USD – 1.1788 ( -33 or -0.28% )
The EURO has remained sideways again at our key levels. We have been here all month and this should set the stage for an interesting week. We will be discussing this market in detail in the LIVE CHAT ROOM this week.
VOLATILITY ALERTS:
Tue 19:00 – Flash Manufacturing PMI
Tue 19:00 – Flash Services PMI
Thu 22:45 – ECB Interest Rate Announcement – LIVE TV
For a sustained move higher we would like to see the EURO break and close above 1.1834. A strong close above this level may result in another retest of 1.1937, and if momentum is very strong all eyes will be on the big 1.2000 handle before another pause.
If the EURO cannot close above 1.1834, we will look for a move back down into 1.1738. A strong close below this level could see the Euro test 1.1678; and should we break lower we may see a move into 1.1613 very quickly. A strong break and close below 1.1613 could a see sharp move lower into 1.1496.
GBP/USD – 1.3188 ( -98 or -0.74% )
Theresa May is in the news for all the wrong reasons as Brexit news picks up steam again. Like the EURO, Cable is bouncing in and out of our levels and they should prove to be pivotal again this week.
VOLATILITY ALERTS:
Wed 19:30 – Prelim GDP (quarterly)
For a continued move to the upside, we would like to see Cable break and close back above 1.3277. Should this occur we will look for the Pound to rally into 1.3309 before a pause; however a strong break of this level could see a retest of 1.3534.
If we cannot break above 1.3277, we will look for a move lower back down to 1.3085 – 1.3035 before a pause. Should we break this level, we cannot rule out a move lower into 1.2868.
USD/JPY – 113.51 ( +168 or +1.5% )
The $/YEN found support to post another rally last week and this market is again showing signs of strength.
For a continued move to the upside we must first see this market close above 113.86. Should this occur we will look for a retest of retest 114.52. A break above this level may see the $/YEN move higher into 115.54, and if momentum is very strong we will look for a move to 116.08.
If we cannot close above 113.86 we will look for a move back down into 112.39. A break below this level is likely to result in a retest of 111.73; and as we mentioned last week: Should we break below 111.73 WATCH OUT- the move that follows may be very sharp into 111.09 and 109.94.
COMMODITIES
GOLD – 1280 ( -23 or -1.77% )
Gold failed to hold above the key 1303 level and we will again be discussing this market closely in the MEMBER PORTAL this week.
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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