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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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AUSTRALASIA
ASX – 4943 ( – 236 or – 4.56% )
The ASX looked like it wanted to rally on open last week but could not hold the momentum. It then quickly reversed from upward momentum to a downside collapse as the ASX fell over 4.5% for the week.
For the upmove to regain its composure and restart then we would like to see 4922 hold as a strong level of support before reaching 4976. A break past 4976 could see 5045 and 5095 very quickly with a final push back towards 5150 where the ASX might take a short breather.
If the ASX has not finished its heavy move down then an early break past 4922 could see a strong push down towards the area between 4863 – 32 which would mathematically reach the range set back in Oct – Nov 2015. However if the downward momentum is strong then we could see an overextension towards 4754.
EUROPE
DAX – 10272 ( – 590 or – 5.43% )
The DAX took a another hit last week falling over 5%. That is 2 weeks in a row, we will be watching for leads from this market moving forward.
NOTE: BE PREPARED FOR A POSSIBLE AN AGGRESSIVE SNAP BACK UP
For the upmove to restart we would like to see a strong long up bar break and close back above 10319. Once this occurs the push up could be strong towards 10389 and 10497 before extending to 10684. Once this level is broken and if the momentum is still strong then 10793 and possibly 10868 could be seen.
For the down move to take a new leg down then 10319 needs to become a solid level of resistance before another attempt at breaking through 10258 is made which will see the DAX down towards 10146, 10073, 35 and finally reaching 9896. Now be careful the DAX has been know to overextend so we will also be watching 9829 and 9744.
US
S&P – 2009 ( – 81 or – 3.88% )
With no more FED buying the markets are starting to get a little nervous. We will be cautiously be watching for further signs of disruption in the coming week with the FED rate decision.
For the upward move to restart we would like to see 2010 hold as a strong level of support before another break up past 2015 towards 2024 and 2033. If the upward momentum is strong then we could see the S&P back up near 2048. Any break past this level will be discussed by our traders in our LIVE CHAT ROOM.
If the S&P cannot get past 2015 again then a push lower could see 1990 quickly. This will actually complete the range set in Oct-Nov 2015. But if the downward momentum remains strong then we would like to see a long down bar break and close past 1981 before we see a strong push past 1972 towards 1947.
FOREX
AUD.USD – 7185 ( – 150 or – 2.04% )
The AUD bounced between 7330 and 7171 last week with no clear direction.
If the AUD is to move higher we would like to see 7177 hold as a strong level of support before a push back past 7230 and 7263 occurs. This could then lead to 7297. 7297 needs to be broken with a long up bar before reaching 7330. If the momentum is strong then 7407 could be seen.
If the AUD cannot stay above 7177 for long we could see 7159 followed by 7116 quickly. This could then lead the pair down towards 7050 and possibly 6996.
EUR.USD – 10922 ( + 115 or + 1.06% )
The EUR moved up ever so slightly.
For the EUR to continue higher we would like to see 10899 hold as a strong level of support before another attempt at breaking past 11038 occurs. If the momentum is strong then 11166 could be seen before another push higher towards 11315 occurs.
If the EUR cannot stay above 10899 then a break past this level could see 10758 quickly. If we see a long down bar break and close past 10758 then the EUR could be back down near 10590 again.
GBP.USD – 15220 ( + 118 or + 0.78% )
Another Chop, Chop scenario for the cable traders last week with the pair repeating the move lower early in the week followed by a strong move back up.
For the GBP to continue a move higher then we would like to see a strong break past 15250 reaching 15308. Once this level is reached then we will need to see a strong long up bar break and close past 15308 before the next push higher towards 15342. If the momentum continues strong then we could see 15463.
For the GBP cannot break past 15308 then a move down could be seen if 15187 is broken early which could see 15061. Once this occurs then we would like to see another long bar break down past 15061 reaching 14953.
USD.JPY – 12095 ( – 215 or – 1.75% )
No love for the USD last week. We have a bit of a scenario here.
1 – Strength in the JPY indicates weak markets
2 – The markets are almost saying that if the Fed raises rates then the markets will go down and the USD will go down.
Oops, not sure if the FED saw this happening. Only Time will tell.
Either way will will be prepared for any move.
For the USD to restart the move higher then we would like to see 12062 hold as a strong level of support before breaking past 12151. If the momentum is strong then the levels we will watch are:
12184, 12225, 12275 before it settles near 12332.
For this pair to continue lower we would like to see 12062 broken early in the week with a long down bar pushing through 12011,11977, 11945 reaching 11925. Once 11925 is broken then we will be watching 11864 for the next move by this pair.
COMMODITIES
GOLD – 1074 ( – 12 or – 1.10% )
A sideways move by GOLD. Therefore comments remain the same
For GOLD to continue higher we need to see 1069 hold as a strong level of support before another attempt at breaking past 1091. Once this is broken then we could see 1103. Any breaks above 1103 will be discussed in our LIVE CHAT ROOM.
If the longer term down move is to restart then 1069 needs to be broken early before we see 1043 and 1025 with the possibility of extending its reach towards 1005.
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