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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 (-36 or -0.51%)
Another characteristically choppy week for the ASX which sees it close slightly lower.
VOLATILITY ALERTS:
Tues 10:30 – RBA Meeting Minutes
Thurs 11:30 – Employment Change and Unemployment Rate
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. 6740 is the next support level down if 6894 doesn’t hold. If downside momentum is really strong then we could see another leg down into 6640.
EUROPE
DAX – 13508 (+494 or +3.8%)
Volatility remained incredibly high for the DAX this week as it traded in a near 2000 point range.
VOLATILITY ALERTS:
Tues 21:00 – German ZEW Economic Sentiment
For the DAX to move higher we would like to see it hold above 13250. Should this occur then 13360 is the next level ahead. If upside momentum is strong then 13610 and 14140 cannot be ruled out.
To the downside, should we not see it hold above 13250, we will look for a move into support at 13000. A strong break and close below this handle and 12630 is the next level down. If downside pressure mounts then 12445 cannot be ruled out.
US
S&P 500 – 4208 (-122 or -2.82%)
The dip buyers are being tested on the SPX as the likes of $AAPL, $MSFT and $AMZN also show signs of toppling.
VOLATILITY ALERTS:
Weds 23:30 – Core Retail Sales M/m and Retail Sales M/m
Thurs 05:00 – FOMC Statement and Interest Rate Decision
Thurs 05:30 – FOMC Press Conference
For a move higher we would like to see the S&P close above 4233. Should this occur, we will look for a move to 4285; and if momentum is strong we cannot rule out moves to 4330 and 4375.
If we cannot hold above 4233, we could see this market move down into 4135. A break of this level however may result in a quick move down to 4035, and if momentum to the downside remains strong we may see a fast move back down to 3965.
FOREX
AUD/USD – 0.7284 (-90 or -1.22%)
The Aussie Dollar endured quite a choppy week as it couldn’t sustain its recent bullish momentum.
VOLATILITY ALERTS:
Tues 10:30 – RBA Meeting Minutes
Thurs 11:30 – Employment Change and Unemployment Rate
For a move higher this week, we would like to see it hold above 0.7284. We will then be targeting a move through 0.7342. If we see a strong break and close above this level then we can’t rule out a move to 0.7392. Should momentum to the upside be really strong then 0.7475 could be targeted.
If this market cannot hold above 0.7285, we could see a move down into 0.7250. A strong break of this level may result in a move into 0.7170, however, any weakness below this level could see a sharp drop into 0.7105.
EUR/USD – 1.0912 (-21 or -0.19%)
The Euro closed in the red for the 5th straight week despite a slightly more hawkish ECB.
VOLATILITY ALERTS:
Thurs 05:00 – FOMC Statement and Interest Rate Decision
Thurs 05:30 – FOMC Press Conference
For a move higher we would like to see the Euro close above 1.1000. Should this occur we could see a move into 1.1105. A break of this level could see this market rally further to 1.1155 and 1.1225.
If the EURO cannot close above 1.1000, we will see a move back into 1.0875. A strong break of this level may result in a move into 1.0780, however, any weakness below this level could see a sharp drop into 1.0575.
GBP/USD – 1.3037 (-198 or -1.5%)
More selling of the Pound on Friday saw the Cable close the week at a new 52 weeks low – everything looks set for a continuation lower from here.
VOLATILITY ALERTS:
Thurs 23:00 – BoE Official Interest Rate Decision and Monetary Policy Summary
For a move to the upside, we would like to see Cable close above 1.3055 before a break higher into 1.3200. If this market can see a strong close above this level we may then see a strong push back into 1.3290. If upside momentum is really strong then a move back into 1.3435 can’t be ruled out.
Should we fail to close above 1.3055, we will look for a move down to 1.2980. A break below this level however could see Cable further depreciate to 1.2855 by the week’s end and if momentum is very weak we cannot rule out a move to 1.2765.
USD/JPY – 117.29 (+243 or +2.12%)
The Dollar Yen got the break it’s been looking for on Friday with a rip through recent highs – watch out for a pullback though as it hits channel resistance.
VOLATILITY ALERTS:
Weds 23:30 – Core Retail Sales M/m and Retail Sales M/m
Thurs 05:00 – FOMC Statement and Interest Rate Decision
Thurs 05:30 – FOMC Press Conference
For a move to the upside, we must now see this market hold above 117. Should this occur we will look for a move into 118.55, and if upside momentum is strong we could see a move higher into 119.30 and potentially 120.42.
If we cannot hold above 117, we could see a move back to test 116.30 before a pause to the downside. A break below this level may result in a sharp move lower into 115.55, and any further breaks to the downside may see a bigger move into 114.7.
COMMODITIES
GOLD – 1987 (+17 or +0.86%)
Quite a week for Gold as it attempted to break a new ATH, but instead posted a double top with a firm rejection off the high.
VOLATILITY ALERTS:
Thurs 05:00 – FOMC Statement and Interest Rate Decision
Thurs 05:30 – FOMC Press Conference
For a move higher we need to see this market hold above 1965. Should this occur we could see a move back into 1990, and any break of this level could see a stronger move into 2015. If momentum is strong then 2075 cannot be ruled out.
If Gold cannot hold above 1960, we will look for a move back down to 1915. A break below this level could see a move lower into 1875, and if momentum is very strong to the downside we could see a move to 1830.
CRYPTOS
BITCOIN – 38815 (-290 or -0.74%)
Overall quite a flat week from Monday’s open till Friday’s close as sellers rejected a midweek price spike – levels remain unchanged.
For a move higher we must now see this market close above 39839. Should this occur we could see a move into 43233 before retesting 44000. If upside momentum is really strong then we can’t rule out 47000.
Failure to close above 39839 could see a move down to 35050. If selling pressure takes control then we could see a move down to 32300. A close below this level and 29444 can’t be ruled out, maybe even a 27434 print.
