This market brief is an overview of the week ahead and some of the events we see as being important to the markets.
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INDICES AUSTRALASIA ASX – 6090 ( -42 or -0.68% ) The ASX starts the week off finding support at the key 6070 level despite a strong sell-off mid week last week. VOLATILITY ALERTS: Thu 11:30 – Unemployment Rate For a continued move higher we must now see the ASX hold above 6070. Should this occur we will look for this market to re-test 6140, and a break above this level could see a quick move to 6175. A strong break above this level however could see a move into 6250 and 6315 by the week’s end. If the ASX cannot hold above 6070, we will look for a move back down into 6000. A break below this level is likely to see a retest of 5986 and further downside may result in a sharp move lower into 5921.
EUROPE DAX – 13243 ( -93 or -0.7% ) The DAX continues its sideways grind higher and we will now look to see if this market can hold these levels for a continued bull participation this week. VOLATILITY ALERTS: Thu 19:00 – German Buba President Weidmann Speaks For a continued move to the upside we must now see the DAX hold above 13205. Should this occur we will look for a retest of 13388 and a potential retest of 13520. Astrong break through 13520 could see this market rally strongly into 13694 and 13835. If the DAX fails to hold above 13205, we may see a push lower back into the key 13050 level. A close below this level could then see a quick move down into 12921 and 12882.
US SP500 – 2784 ( +42 or +1.53% ) The S&P continues to outshine in global equities as this market is officially on a tear posting strong gains since the year began. We will be covering the US markets exclusively this week in the MEMBER PORTAL this week. NOTE: Monday is a public holiday (Martin Luther King Day) VOLATILITY ALERTS: Wed 00:30 – Empire State Manufacturing Index Fri 00:30 – Building Permits Fri 00:30 – Housing Starts Sat 02:00 – Prelim UoM Consumer Sentiment For a move higher we would like to see the S&P hold above 2750, on its way to test 2808. A break above 2808 could see a quick move to 2824 however should this market break this level, WATCH OUT- we could see a very sharp move higher into 2848! If we cannot hold above 2750, we will look for a move back down to 2736. A strong break and close below this level could then see this market move back down to 2694 by the week’s end.
FOREX AUD/USD – 0.7915 ( +53 or +0.67% ) The Aussie Dollar was yet again sold off last week and is now a few points above the key 75c level. VOLATILITY ALERTS: Thu 11:30 – Unemployment Rate For a move higher we must now see this market hold above 0.7903, followed by a strong break and close above 0.7934. Should this occur we will look for this market to test 0.7988. A strong break and close above 0.7988 could see this market post further gains into 0.8034. If we cannot hold above 0.7903, we could see the AUD retest 0.7833. Should we break lower however, we will look for a move back into 0.7779 and if downside momentum continues we could see 0.7729 quickly before another pause. EUR/USD – 1.2181 ( +161 or +1.34% ) The EURO continues its impressive start to 2018 with its fourth straight week of positive returns. Friday saw a very strong move higher breaking through key resistance and we now have some ahead. VOLATILITY ALERTS: Wed 21:00 – Final CPI (annual) Thu 19:00 – German Buba President Weidmann Speaks For a sustained move higher we would like to see the EURO hold above 1.2165 followed by a strong push into 1.2266. Should this occur, we will then look for this market to test 1.2358. If the EURO cannot hold above 1.2165, we could see a move back down 1.2040 before a pause. This is an important level and any subsequent strong break and close below this level may see the EURO sell-off further into 1.1929 this week. GBP/USD – 1.3734 ( +169 or +1.25% ) The Pound also broke through very key technical levels last week and came a few points shy of our key 1.3743 level. VOLATILITY ALERTS: Tue 20:30 – CPI (annual) Fri 20:30 – Retail Sales (monthly) For a continued move to the upside, we would like to see Cable break through and hold above 1.3743. A break of this level could see the Pound quickly reach 1.3875 before a pause; and if momentum is very strong a move to 1.4075 cannot be ruled out. If we fail to close and hold above 1.3743, we may see this market trade back into 1.3534. A strong break below this level could then see this market trade down to 1.3436 before a pause; and if momentum is very strong to the downside we cannot rule out a move to 1.3277.
USD/JPY – 111.03 ( -204 or -1.8% ) The YEN continues to strengthen against the US dollar and last week we saw yet another strong sell-off. Will this continue this week or will we see a reversal early on? We will be discussing the impact of this move in more detail in the MEMBER PORTAL this week. For a move to the upside we must now see this market break and close above 111.09. Should this occur we will look for a move into 111.72, and a strong break and close above this level may see the $/YEN rally strongly into 112.68. If we cannot close above 111.09, we could see a move back down into 109.04. A strong break below this level could see a further move down into 109.21, and momentum is very strong to the downside we may see a sharp move down into 108.31.
COMMODITIES GOLD – 1339 ( +20 or +1.52% ) GOLD is also off to a flyer in 2018 and this market now has its sights set for the 2017 highs above 1350. Members will be first to know how we are trading this as we discuss this market in more detail in the LIVE CHAT ROOM . For a continued move higher we would like to see this market hold above 1333. Should this occur we will look for a strong move into 1355 before another pause. If momentum is very strong, 1375 cannot be ruled out. If Gold cannot hold above 1333, we will look for a strong move back down into 1322. A strong break below this level could see GOLD sell off further into 1313, and if momentum is strong to the downside we could see 1303 before the week’s end.
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