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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 6650 (-33 or -0.49%)
The ASX edged lower but overall it was a week that ended fairly flat – as such our levels remain the same.
VOLATILITY ALERTS:
Tues 11:30 – Retail Sales M/m
Tues 14:30 – RBA Interest Rate Decision and Statement
For a move higher we would like to see the ASX hold above 6650. Should this occur, a move into 6745 could be expected; and if momentum is strong we cannot rule out moves to 6875 and 6980.
Failure to hold above 6650 means a potential move into 6550. 6500 is the next support level down if 6400 doesn’t hold. If downside momentum is really strong then we could see another leg down into 6250.
EUROPE
DAX – 12906 (-307 or -2.32%)
The DAX continued to make more recent lows and keep the bear market alive.
For the DAX to move higher we would like to see it close above 12965. Should this occur then 13250 is the next level ahead. If upside momentum is strong then 13600 and 14140 cannot be ruled out.
To the downside, should we not see it close above 12965, we will look for a move into support at 12635. A strong break and close below this handle and 12445 is the next level down. If downside pressure mounts then 12300 cannot be ruled out.
US
S&P 500 – 3822 (-89 or -2.28%)
July started much better than June ended – can that momentum be continued through?
VOLATILITY ALERTS:
Thurs 00:00 – Jolts Jobs Openings
Thurs 04:00 – FOMC Minutes
Fri 22:30 – NFP Report and Unemployment Rate
For a move higher we would like to see the S&P close above 3830. Should this occur, we will look for a move to 3870; and if momentum is strong we cannot rule out moves to 3965 and 4035.
If we cannot close above 3830, we could see this market move down into 3725. A break of this level however may result in a quick move down to 3665, and if momentum to the downside remains strong we may see a fast move back down to 3585.
FOREX
AUD/USD – 0.6617 (-118 or -1.7%)
A downside breakout of consolidation as the Aussie Dollar broke new yearly lows, the start of a new leg lower?
VOLATILITY ALERTS:
Tues 11:30 – Retail Sales M/m
Tues 14:30 – RBA Interest Rate Decision and Statement
For a move higher this week, we would like to see it close above 0.6830. We will then be targeting a move through 0.6900. If we see a strong break and close above this level then we can’t rule out a move to 0.6945. Should momentum to the upside be really strong then 0.6995 could be targeted.
If this market cannot close above 0.6830, we could see a move down into 0.6755. A strong break of this level may result in a move into 0.6675, however, any weakness below this level could see a sharp drop into 0.6580.
EUR/USD – 1.0425 (-129 or -1.22%)
USD bulls re-entered the room to leave the Euro threatening new yearly lows.
VOLATILITY ALERTS:
Thurs 04:00 – FOMC Minutes
Fri 22:30 – NFP Report and Unemployment Rate
For a move higher we would like to see the Euro close above 1.0445. Should this occur we could see a move into 1.0500. A break of this level could see this market rally further to 1.0570 and 1.0645.
If the EURO cannot hold above 1.0445, we will see a move into 1.0355. A strong break of this level may result in a move into 1.0215, however, any weakness below this level could see a sharp drop into parity at 1.0000.
GBP/USD – 1.2091 (-181 or -1.47%)
The Cable continues to print lower highs and continued breaks of the lows should not be ruled out.
VOLATILITY ALERTS:
Tues 20:00 – BoE Bailey speaks
For a move to the upside, we would like to see Cable close above 1.2160 before a break higher into 1.2245. If this market can see a strong close above this level we may then see a strong push back into 1.2390. If upside momentum is really strong then a move back into 1.2580 can’t be ruled out.
Should we fail to close above 1.2160, we will look for a move down to 1.2075. A break below this level however could see Cable further depreciate to 1.1955 by the week’s end and if momentum is very weak we cannot rule out a move to 1.1825.
USD/JPY – 135.24 (+4 or +0.03%)
Another flat week for the Dollar Yen and our levels remain unchanged.
VOLATILITY ALERTS:
Thurs 00:00 – Jolts Jobs Openings
Thurs 04:00 – FOMC Minutes
Fri 22:30 – NFP Report and Unemployment Rate
For a move to the upside, we must now see this market hold above 134.55. Should this occur we will look for a move into 135.3, and if upside momentum is strong we could see a move higher into 137.2 and potentially 139.3.
If we cannot hold above 134.55, we could see a move back to test 133.72 before a pause to the downside. A break below this level may result in a sharp move lower into 132.35, and any further breaks to the downside may see a bigger move into 130.85.
COMMODITIES
GOLD – 1808 (-19 or -1.04%)
Gold closed lower for the second week running but could we see the start of a double bottom forming?
VOLATILITY ALERTS:
Fri 22:30 – NFP Report and Unemployment Rate
For a move higher we need to see this market close above 1830. Should this occur we could see a move into 1850; and any break of this level could see a stronger move into 1875. If momentum is strong then 1900 cannot be ruled out.
If Gold cannot close above 1830, we will look for a move down to 1800. A break below this level could see a move lower into 1785; and if momentum is very strong to the downside we could see a move to 1750.
CRYPTOS
BITCOIN – 19560 (-2076 or -9.6%)
Sellers regained control of risk assets and BTC wasn’t able to hold onto key support – the further downside to come?
For a move higher we must now see this market close above 20000. Should this occur we could see a move into 21715 before retesting 23675. If upside momentum is really strong then we can’t rule out 25875.
Failure to close above 20000 could see a move into 17560. If selling pressure takes control then we could see a move down to 14000. A close below this level and 12320 can’t be ruled out, maybe even a 10700 print.
