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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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INDICES
AUSTRALASIA
ASX – 7032 ( +127 or +1.84% )
The ASX found buyers early in the week following the RBA’s decision to keep rates unchanged.
For a continued move higher we must now see the ASX hold above 7011. Should this occur we will look for a re-test of 7144. A strong break of this level however is likely to see the ASX rally to to further all-time highs at 7286.
If the ASX cannot hold above 7011, we will look for a move back down to 6850. A strong break and close below this level however could see the ASX move lower into 6804 before a pause; and if downside momentum is very strong, we could see a move down to 6682.
EUROPE
DAX – 13476 ( +544 or +4.21% )
The DAX struggled to break to new all time highs and is now in double top territory.
VOLATILITY ALERTS:
Wed 01:00 – ECB President Lagarde Speaks
Thu 21:00 – EU Economic Forecasts
Fri 18:00 – German Prelim GDP (quarterly)
For a continued move to the upside we must now see the DAX hold above 13333. Should this occur, we will look for a strong move into 13205, and if momentum remains strong a push back higher into 13576; and if momentum remains very strong we could see a move into 13819.
If the DAX fails to close above 13333, we may see a retest back down into the key level of 13205 .A close below this level is likely to see a retest of 13000; however if momentum is very strong to the downside we cannot rule out a move to 12921.
US
SP500 – 3324 ( +96 or +2.97% )
The S&P managed to rally higher yet again despite the impact of the coronavirus. We will be discussing this in the MEMBER PORTAL this week.
VOLATILITY ALERTS:
Wed 02:00 – Fed Chair Powell Testifies
Sat 00:30 – Retail Sales (monthly)
Sat 02:00 – Prelim UoM Consumer Sentiment
For a move higher we would like to see the S&P hold above 3274. Should this occur, we will look for a move higher into 3395. A strong break above this level however sets the stage for a move into 3420.
If we cannot close above 3274, we could see this market move lower into 3248. A break of this level however may result in quick move down to 3208; and if momentum to the downside remains strong we may see a fast move down to 3166.
FOREX
AUD/USD – 0.6676 ( -9 or -0.13% )
The Aussie Dollar closed weaker last week and is now at critical levels. We will be discussing the impact of this in the LIVE CHAT ROOM.
For a move higher, we would first like to see the AUD close above 0.6762. Should this occur, we will look for a retest of of 0.6875, and if upside momentum remains very strong, we may see a push higher into 0.6934 before a pause.
If the AUD cannot close above 0.6762, we could see this market break lower and test 0.6598. If momentum to the downside is very strong, 0.6457 cannot be ruled out.
EUR/USD – 1.0943 ( -151 or -1.36% )
The EURO was also very weak last week as the sell-off below 1.1000 continues.
VOLATILITY ALERTS:
Wed 01:00 – ECB President Lagarde Speaks
Thu 21:00 – EU Economic Forecasts
Fri 18:00 – German Prelim GDP (quarterly)
For a move higher this week, we would like to see the EURO close above 1.0977; followed by a break back above 1.1033. Should this occur, we could then see a move to 1.1197 before a pause; and if momentum is very strong to the upside we cannot rule out a move into 1.1249.
If the EURO cannot close above 1.0977, we could see a move down into 1.0902 before a pause. If this market continues to sell-off, we could see a sharp move down into 1.0814 by the week’s end.
GBP/USD – 1.2885 ( –320 or -2.42% )
The UK also sold off and this will be an important week for this market. We will be discussing this market exclusively in the LIVE CHAT ROOM this week.
VOLATILITY ALERTS:
Tue 20:30 – Prelim GDP (quarterly), Manufacturing Production
Wed 02:35 – BoE Governor Carney Speaks
For a move to the upside, we would like to see Cable hold above 1.2868, followed by a retest of 1.3035 before a pause. Should this occur, we will look for a move to 1.3161 – 1.3191.
On the downside, should we fail to hold above 1.2868, we will be watching the key level at 1.2720 very closely. A strong break below this level however sets this market up for a bigger move down into 1.2622, and if momentum is very strong we cannot rule out a move to 1.2480.
USD/JPY – 109.76 ( +140 or +1.29% )
They $/YEN was higher off a strong $US rally last week however we remain in a sideways range as we have stated for the past month.
NOTE: Tuesday is a public holiday in Japan (National Foundation Day)
For a move to the upside we must now see this market close above 109.94. Should this occur we will look for a move into 110.31, and if momentum is very strong we could see moves to 110.78 and 111.09.
If we cannot close above 109.94, we could see a move lower into 109.21. A break below this level may result in a retest of 108.31; and any further breaks to the downside may see a bigger move and full fade into 107.75 before a pause.
COMMODITIES
GOLD – 1570 ( -19 or -1.2% )
Like the $/YEN, Gold is also in a sideways range.
For a continued move higher we must now see this market close above 1574, followed by a close above 1605. A break and close above this level sets the stage for a move to 1620; and if momentum is very strong to the upside we cannot rule out a move to 1632.
If Gold cannot close above 1574, we will look for a sharp move back down to 1525. This is a pivotal area; and any break below this level sets the stage for a much larger move down to 1504 and 1474.
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The views represented on this website do not contain (and should not be construed as containing) financial advice, recommendations, opinions in relation to acquiring, holding or disposing of a financial product of any kind, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Trade View Investments accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of the above information. Consequently any person acting on it does so entirely at his or her own risk. The research does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.
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