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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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ASX – 5800 ( – 37 or – 0.63% )
The ASX keeps going down after a dominant run up for 2 months breaks all previous ranges. Last week saw some volatility as it struggled to find a direction once it reached the area around 5790. As the close is near 5790 again, we see this area being the key for next weeks direction. Therefore our comments remain the same
For the ASX to regain composure and start the move higher again we would like to see 5790 hold as a strong level of support before a strong early break and close past both 5842 and 5892 is achieved. If this occurs with strong momentum we could see the ASX back up near 5982 quickly. If the strong momentum continues past this level we could see a new move past 6000 reaching 6108.
As the first process down has started, its continuation would be confirmed if we see a strong break down past a key FICM level of 5790. If the downward momentum picks up momentum then 5754 and 5715 could be seen quickly. We will be watching to see if a strong break occurs past 5715 which could lead the ASX to an ambitious level of 5636.
DAX – 11947 ( + 423 or + 3.67% )
“The DAX is not waiting for anyone atm, it may pause for a second or two but once it catches it’s breath off it goes again. We feel that if these moves by the DAX are the real deal then the rest of the markets will need to catch up, either way get ready for some action over the next week or two.”
As we continue to see all time highs again we will be watching the momentum to decide on direction. The next key level for the DAX to the upside is 12531(MEMBERS: this is drawn on the weekly chart in yellow, you will also see the next possible extension being 13578 – for the coming weeks) this has been calculated by our mathematical models. Any short term moves will be discussed further in our LIVE CHAT ROOM.
If the downside move starts then we would like to see an early break past 11791 followed by a strong break past 11621. If the downside move is corrective then we would be very cautious and could see the DAX overextend to the area between 11292 – 57. Remember the DAX moves quickly.
S&P – 2052 ( – 20 or – 0.97% )
The SPX moved lower again, as mentioned last week its a simple equation
“Good news is now Bad news until it becomes Good news again. “
Our Primary model FICM indicated a potential slowdown on Wednesday (11_03_15) of the downside move.
Once again, If the down move was just a quick flush of traders and we see another move higher this week we will be looking for an early strong break and close past both 2076 and 2085 before another attempt at breaking back above 2101 is made. The next key level will be 2126.
For the down move to continue we would like to see an early break and close past 2050. If the momentum is strong then 203 and 2024 will become the next targets. If the down move is significant then an ambitious level of 2010 could be seen.
AUD.USD – 7635 ( – 79 or – 1.02% )
An early leg down followed by a strong leg up and then back down, that my friend is price action at its best with the AUD finding volatility as the USD story intensifies.
For the up move to restart we would like to see the AUD break back above 7718 before a strong push is needed to reach 7927. The only way we see 8088 is by a strong short squeeze.
For the downside move to continue we would like to see a strong down bar break past 7494. Once this occurs we could see 7407 and if the momentum is strong then 7263 could be seen.
EUR.USD – 10496 ( – 346 or – 3.19% )
Another 3% plus down move for the EUR.
“No short squeeze here, maybe fake breakouts as the EUR continued lower last week. I think the big question is that the markets are still trying to work out what the true value of the EUR really is with the stimulus.” If the FED’s tone re raising rates changes then we could see a massive short squeeze as everywhere we turn, we hear traders being short the EUR.
If there is some sort of short squeeze and the EUR moves up again then we would like to see an early break and close back past 10590 before reaching 10780. We would need to see strong momentum before the EUR see;s 10899.
For the downleg to continue we would like to see 10452 broken with another long down bar followed by a strong move towards 10283. Further downside levels we will be watching are 10206, 10121, 10044.
GBP.USD – 14739 ( – 294 or – 1.96% )
USD strength everywhere. The GBP had no change as it took another leg lower in line with the other majors. Once the Jan 2015 low’s were broken it was ruthless on the way down.
For the GBP to restart its move higher we would to see a long up bar break and close back above 14832. Once this occurs 14950 will need to be broken.
For the down move to continue we would like to see an early break down reaching 14563. If the momentum is strong and it breaks past 14563 we could see 14372.
USD.JPY – 12142 ( + 63 or + 0.52% )
Another move higher by the USD against the JPY but stopped by the highs in DEC 2014. It has still managed to close higher for the week.
For the USD to continue its rally we would like to see 12184 broken with a long solid up bar reaching 12275. If the upward momentum is strong then 12403 will be our first target on its way towards 12649. Intraday moves will be discussed in our LIVE CHAT ROOM.
If the USDJPY restarts back lower then we would like to see strong early break and close past 12064 moving towards 11931. Further breaks could see USDJPY reaching 11813 followed by 11679.
GOLD – 1157 ( – 10 or – 0.86% )
GOLD, continues lower as the rate rise possibility is imminent. One note of caution, if the rate rise does not occur and the wording by the FED changes, be ready for a sharp reversal in many instruments, GOLD will be one of them.
For the upward to have any chance we need to see a strong early break and close back 1167 before moving past the area between 1178 – 80. Once this occurs then the next level of importance will be 1208.
If Friday’s move was the start of a continued move lower then a solid break past 1149 could see GOLD near 1103 very, very quickly
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