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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 7182 (-6 or -0.08%)
A flat week for the ASX, as such our levels remain unchanged.
VOLATILITY ALERTS:
Tues 11:30 – Nab Business Confidence
Thurs 11:30 – Employment Change
For a move higher we would like to see the ASX close above 7200. Should this occur, a move into 7272 could be expected; and if momentum is strong we cannot rule out moves to 7400 and 7500.
Failure to close above 7200 means a potential move back into 7091. 7000 is the next support level down if 7091 doesn’t hold. If downside momentum is really strong then we could see a sharp move to 6915.
EUROPE
DAX – 15170 (-69 or -0.45%)
The DAX took out some key recent lows in the week but recovered well as it closed slightly lower.
VOLATILITY ALERTS:
Tues 20:05 – Zew Economic Sentiment Indicator
For the DAX to continue its move higher we would like to see it hold above 15050. Should this occur then 15345 is the next level ahead. If upside momentum is strong then 15585 and 15800 cannot be ruled out.
To the downside, should we not see it hold above 15050, we will look for a move into support at 14805. A strong break and close below this handle and 14610 is the next level down. If downside pressure mounts then 14410 cannot be ruled out.
US
S&P 500 – 4391 (+29 or +0.66%)
The SPX closed slightly higher as concerns over a US debt default eased – how will traders digest the NFP miss on Friday this week
VOLATILITY ALERTS:
Weds 01:00 – Jolts Jobs Openings
Thurs 23:30 – Core CPI M/m & Y/y
Fri 23:30 – Retail Sales M/m
For a move higher we would like to see the S&P hold above 4375. Should this occur, we will look for a move to 4420, and if momentum is very strong we cannot rule out moves to 4450.
If we cannot hold above 4375, we could see this market move down into 4352. A break of this level however may result in a quick move down to 4300, and if momentum to the downside remains strong we may see a fast move back down to 4265.
FOREX
AUD/USD – 0.7310 (+51 or +0.7%)
The Aussie Dollar climbed higher but can it break through resistance this week to retest the recent highs?
VOLATILITY ALERTS:
Tues 11:30 – Nab Business Confidence
Thurs 11:30 – Employment Change
For a move higher this week, we would like to see it close above 0.7342. We will then be targeting a move back into 0.7423 where we may see a pause. If we see a strong break and close above this level then we can’t rule out a move to 0.7500.
If this market cannot close above 0.7342, we could see a move down into 0.7250. A strong break of this level may result in a move into 0.7065, however, any weakness below this level could see a sharp drop into 0.7000.
EUR/USD – 1.1574 (-18 or -0.16%)
VOLATILITY ALERTS:
Thurs 20:00 – EU Retail Sales
Fri 23:30 – Non-Farm Payrolls
The Euro continues to look soft and despite closing flat for the week, the sellers remain in control.
For a move higher we would like to see the Euro close above 1.1615. Should this occur we could see a move into 1.1738 before a pause. A break of this level could see this market rally further to 1.1833; and if momentum is very strong, 1.1925 cannot be ruled out.
If the EURO cannot close above 1.1615, we could see a move into 1.1570. A strong break of this level may result in a move into 1.1500, however, any weakness below this level could see a sharp drop into 1.1425.
GBP/USD – 1.3620 (+75 or +0.55%)
The Cable strengthened as it looks to bounce back from the recent sell off – watch out for a move back into its 200 DMA.
VOLATILITY ALERTS:
Weds 17:00 – Manufacturing Production M/m & GDP M/m
For a move to the upside, we would like to see Cable hold 1.3620 before a break higher through 1.3666. If this market can see a strong close above this level we may then see a strong push back into 1.3755. If upside momentum is really strong then a move back into 1.3865 can’t be ruled out.
Should we fail to hold above 1.3620, we will look for a move down to 1.3545. A break below this level however could see Cable further depreciate to 1.3435 by the week’s end and if momentum is very weak we cannot rule out a move to 1.3290.
USD/JPY – 111.94 (+88 or +0.79%)
The Dollar Yen ripped on Friday to give a strong weekly close at a new yearly high. Can it now follow through and sustain a move higher?
VOLATILITY ALERTS:
Weds 01:00 – Jolts Jobs Openings
Thurs 23:30 – Core CPI M/m & Y/y
Fri 23:30 – Retail Sales M/m
For a move to the upside we must now see this market hold above 111.7. Should this occur we will look for a retest of 112.25, and if upside momentum is strong we could see a move higher into 113.18 and potentially 114.23.
If we cannot hold above 111.7, we could see a move back to test 111 before a pause to the downside. A break below this level may result in a sharp move lower into 110.38; and any further breaks to the downside may see a bigger move into 109.94.
COMMODITIES
GOLD – 1756 (+10 or +0.57%)
Another flat week for Gold and a false breakout to the upside on Friday left a very bearish looking candle.
VOLATILITY ALERTS:
Thurs 23:30 – Core CPI M/m & Y/y
Fri 23:30 – Retail Sales M/m
For a move higher we need to see this market hold above 1756. Should this occur we need to see a move back into 1786; and any break of this level could see a stronger move into 1814. If momentum is really strong then 1832 cannot be ruled out.
If Gold cannot hold above 1756, we will look for a move back down to 1740. A break below this level could see a move lower into 1720; and if momentum is very strong to the downside we could see a move to 1678.
CRYPTOS
BITCOIN – 54710 (+6766 or +14.11%)
Bitcoin smashed through the 50k barrier after SEC chair Gensler suggested they are not looking to ban crypto in the US – will we be talking about ATH’s this week?
For a move higher we must now see this market hold above 50000. Should this occur we could see a move into 55000 before retesting 59000. If upside momentum is really strong then we can’t rule out 63500.
Failure to hold above 50000 could see a move down to 47000. If selling pressure takes control then we could see a move down to 44000. A close below this level and 42000 can’t be ruled out.
