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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 7183 (+119 or +1.68%)
The ASX looked to be forming a V-shaped recovery but saw a firm rejection from its 200 DMA retest.
VOLATILITY ALERTS:
Tues 11:30 – Monetary Policy Meeting Minutes
Thurs 11:30 – Unemployment Rate
For a move higher we would like to see the ASX hold 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 hold 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 – 15140 (+53 or +0.35%)
The DAX is unsettled and continues to test the bottom of its year long range – will it hold?
VOLATILITY ALERTS:
Tues 21:00 – German ZEW Economic Sentiment
For the DAX to move higher we would like to see it close above 15345. Should this occur then 15585 is the next level ahead. If upside momentum is strong then 15780 and 16000 cannot be ruled out.
To the downside, should we not see it close above 15345, we will look for a move into support at 15050. A strong break and close below this handle and 14779 is the next level down. If downside pressure mounts then 14425 cannot be ruled out.
US
S&P 500 – 4428 (-58 or -1.29%)
The SPX gave up all it’s previous weekly gains as geopolitical risks and the threat of further rate hikes weighed on sentiment.
VOLATILITY ALERTS:
Thurs 23:30 – CPI and Core CPI M/m and Y/y
Tues 03:00 – Fed Member Bullard Speaks
Thurs 00:30 – Retail Sales and Core Retail Sales M/m
Thurs 06:00 – FOMC Meeting Minutes
For a move higher we would like to see the S&P close above 4432. Should this occur, we will look for a move to 4480; and if momentum is strong we cannot rule out moves to 4555 and 4600.
If we cannot hold above 4432, we could see this market move down into 4375. A break of this level however may result in a quick move down to 4330, and if momentum to the downside remains strong we may see a fast move back down to 4285.
FOREX
AUD/USD – 0.7128 (+56 or +0.79%)
The Aussie Dollar saw a big intra week reversal to record a weak close, despite closing slightly higher for the week – if risk sells this week expect the AUD to go with it.
VOLATILITY ALERTS:
Tues 11:30 – Monetary Policy Meeting Minutes
Thurs 11:30 – Unemployment Rate
For a move higher this week, we would like to see it hold above 0.7105. We will then be targeting a move through 0.7170. If we see a strong break and close above this level then we can’t rule out a move to 0.7225.
If this market cannot close above 0.7105, we could see a move down into 0.7065. A strong break of this level may result in a move into 0.6995, however, any weakness below this level could see a sharp drop into 0.6920.
EUR/USD – 1.1346 (-103 or -0.9%)
Another rejection from the recent highs sees the Euro move lower and doesn’t appear ready to make that move higher.
VOLATILITY ALERTS:
Thurs 00:30 – US Retail Sales and Core Retail Sales M/m
Thurs 06:00 – FOMC Meeting Minutes
For a move higher we would like to see the Euro hold above 1.1345. Should this occur we could see a move into 1.1425. A break of this level could see this market rally further to 1.1500.
If the EURO cannot hold above 1.1345, 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 1.1110.
GBP/USD – 1.3559 (+32 or +0.24%)
The Cable spent the week largely range bound and that was reflected with the relatively flat close – our levels remain the same.
VOLATILITY ALERTS:
Weds 18:00 – CPI and Core CPI Y/y
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 – 115.48 (+30 or +0.26%)
The Dollar Yen edged higher but did reject off the recent high – are we set for a double top to complete?
VOLATILITY ALERTS:
Thurs 00:30 – US Retail Sales and Core Retail Sales M/m
Thurs 06:00 – FOMC Meeting Minutes
For a move to the upside we must now see this market hold above 114.70. Should this occur we will look for a move into 115.55, and if upside momentum is strong we could see a move higher into 116.10 and potentially 117.
If we cannot hold above 114.70, we could see a move back to test 114.23 before a pause to the downside. A break below this level may result in a sharp move lower into 113.20, and any further breaks to the downside may see a bigger move into 112.25.
COMMODITIES
GOLD – 1858 (+50 or +2.77%)
Gold is on the move! Is an invasion of Ukraine by Russia the ‘catalyst’ needed for a large breakout?
VOLATILITY ALERTS:
Thurs 00:30 – US Retail Sales and Core Retail Sales M/m
Thurs 06:00 – FOMC Meeting Minutes
For a move higher we need to see this market hold above 1850. Should this occur we could see a move back into 1875; and any break of this level could see a stronger move into 1905. If momentum is really strong then 1930 cannot be ruled out.
If Gold cannot hold above 1850, we will look for a move back down to 1830. A break below this level could see a move lower into 1815; and if momentum is very strong to the downside we could see a move to 1785.
CRYPTOS
BITCOIN – 42442 (+1821 or +4.48%)
BTC moved higher for the week but looks vulnerable to another risk-off play.
For a move higher we must now see this market hold 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 hold 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.
