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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 7070 (-338 or -4.56%)
The ASX’s largest weekly fall since March 2020 as risk-off sentiment weighed on global markets.
For a move higher we would like to see the ASX close above 7091. Should this occur, a move into 7202 could be expected; and if momentum is strong we cannot rule out moves to 7272 and 7400.
Failure to close above 7091 means a potential move back into 7000. 6894 is the next support level down if 6740 doesn’t hold. If downside momentum is really strong then we could see a sharp move to 6500.
EUROPE
DAX – 15417 (-570 or -3.57%)
The DAX is back at levels seen in March 2021 as it posted 5 red days this week.
For the DAX to move higher we would like to see it close above 15585. Should this occur then 15780 is the next level ahead. If upside momentum is strong then 16000 and 16200 cannot be ruled out.
To the downside, should we not see it close above 15585, we will look for a move into support at 15350. A strong break and close below this handle and 15050 is the next level down. If downside pressure mounts then 14779 cannot be ruled out.
US
S&P 500 – 4381 (-286 or -6.13%)
Bloodbath across US equities as tech continued to suffer – with rising rates, geopolitical risk and poor earnings weighing on sentiment.
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 4432; and if momentum is strong we cannot rule out moves to 4482 and 4555.
If we cannot hold above 4375, we could see this market move down to 4330. A break of this level however may result in a quick move down to 4286, and if momentum to the downside remains strong we may see a fast move back down to 4233.
FOREX
AUD/USD – 0.7172 (-46 or -0.64%)
Interestingly the Aussie Dollar held relatively firm despite the risk-off trading as China’s central bank pivoted more dovish.
For a move higher this week, we would like to see it hold above 0.7170. We will then be targeting a move through 0.7234. If we see a strong break and close above this level then we can’t rule out a move to 0.7343.
If this market cannot close above 0.7170, we could see a move down into 0.7105. A strong break of this level may result in a move into 0.7012, however, any weakness below this level could see a sharp drop into 0.6995.
EUR/USD – 1.1342 (-73 or -0.64%)
A false start for the Euro as it faded the move out of the range and now could be stuck again.
For a move higher we would like to see the Euro close above 1.1350. Should this occur we could see a move into 1.1425 before a pause. A break of this level could see this market rally further to 1.1500.
If the EURO cannot close above 1.1350, we will see a move back into 1.1225. A strong break of this level may result in a move into 1.1155, however, any weakness below this level could see a sharp drop into 1.1105.
GBP/USD – 1.3552 (-129 or -0.94%)
The Cable rejected its 200 DMA again which could be the turning point for a new trend lower.
For a move to the upside, we would like to see Cable hold above 1.3535 before a break higher through 1.3620. If this market can see a strong close above this level we may then see a strong push back into 1.3670. If upside momentum is really strong then a move back into 1.3750 can’t be ruled out.
Should we fail to hold above 1.3535, we will look for a move down to 1.3435. A break below this level however could see Cable further depreciate to 1.3290 by the week’s end and if momentum is very weak we cannot rule out a move to 1.3198.
USD/JPY – 113.68 (-50 or -0.44%)
The Dollar Yen edged lower as greater flow went into the ‘safe haven’ JPY.
For a move to the upside, we must now see this market close above 114.23. Should this occur we will look for a move into 114.69, and if upside momentum is strong we could see a move higher into 115.55 and potentially 116.10.
If we cannot hold above 114.23, we could see a move back to test 113.20 before a pause to the downside. A break below this level may result in a sharp move lower into 112.25, and any further breaks to the downside may see a bigger move into 111.65.
COMMODITIES
GOLD – 1834 (+17 or +0.94%)
Gold looks like it wants to get going… but can it?
For a move higher we need to see this market hold above 1830. Should this occur we could see a move back into 1850, and any break of this level could see a stronger move into 1875. If momentum is really strong then 1890 cannot be ruled out.
If Gold cannot hold above 1830, we will look for a move back down to 1814. A break below this level could see a move lower into 1786, and if momentum is very strong to the downside we could see a move to 1756.
CRYPTOS
BITCOIN – 35143 (-7775 or -18.12%)
When US equities are moving lower and looking volatile, it’s highly likely that BTC will be too, but at a much greater multiple.
For a move higher we must now see this market hold above 37746. Should this occur we could see a move into 38741 before retesting 39839. If upside momentum is really strong then we can’t rule out 43233.
Failure to hold above 35050 could see a move down to 32300. If selling pressure takes control then we could see a move down to 29444 (which was mentioned by our Director in our LIVE Chat Room). A close below this level and 27434 can’t be ruled out maybe even a 25000 print.
