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 – 5438 ( +36 or +0.67% ) The ASX managed yet another higher close by week’s end despite it being contained within a larger range. VOLATILITY ALERTS: Tue 11:30 – Monetary Policy Meeting Minutes Thu 12:30 – RBA Governor Lowe Speaks For a continued move higher we must now see the ASX hold above 5408 followed by a retest into 5590. Should this occur we will look for a move into 5746, and if momentum to the upside remains strong we cannot rule out a move to 5985. If the ASX cannot hold above 5408, we will look for a move back down to 5102. A strong break and close below this level could see the ASX retest lower into 4820. EUROPE DAX – 10529 ( -394 or -3.61% ) The DAX was lower last week following yet another short-term high. Can this market bounce this week? We will be discussing this in the MEMBER PORTAL this week. NOTE: Thursday is a public holiday in Germany (Ascension Day) VOLATILITY ALERTS: Fri 17:30 – German Flash Manufacturing, Services PMI For a move to the upside we must see the DAX close above 10760. Should this occur we will look for a retest of 11050 . If the DAX can break strongly through this level, we will look for a move into 11366. If the DAX fails to close above 10760, we will look for a move back down to 10266 before a pause. Any break below this level however could see the DAX sell-off sharply into 10010, and if momentum is very strong to the downside we cannot rule out a move back down to 9690. US SP500 – 2860 ( -77 or -2.62% ) The S&P is also now in a sideways range as markets now position for the next move in this market. Last week we asked- are the bulls or bears really in control here? We will be discussing this in the MEMBER PORTAL this week. VOLATILITY ALERTS: Tue 22:30 – Building Permits Wed 00:00 – Fed Chair Powell Testifies Thu 04:00 – FOMC Meeting Minutes Thu 23:45 – Flash Manufacturing PMI Fri 04:30 – Fed Chair Powell Speaks For a move higher, we would like to see the S&P close above 2902. Should this occur we will look for a move into 2998. A strong break above this level could see this market rally strongly to 2140. If we cannot close above 2902, we could see this market sell-off into 2838. If momentum to the downside is strong we may see a move lower into 2780; and a close below this level may result in a very fast move down to 2678. FOREX AUD/USD – 0. 6415 ( -115 or -1.76% ) The Aussie Dollar is also sideways and at a very important juncture. VOLATILITY ALERTS: Tue 11:30 – Monetary Policy Meeting Minutes Thu 12:30 – RBA Governor Lowe Speaks For a move higher, we would first like to see the AUD close above 0.6456. Should this occur, we will look for a retest of 0.6592, and if upside momentum remains very strong, we may see a push higher into 0.6692 before a pause. If the AUD cannot close above 0.6456, we could see this market break lower and retest 0.6282. If momentum to the downside is very strong, a move back down to 0.6092 cannot be ruled out. EUR/USD – 1.0819 ( -19 or -0.18% ) The EURO is testing the lower end of its sideways range with important support to watch this week. NOTE: Thursday is a public holiday in France and Germany (Ascension Day) VOLATILITY ALERTS: Fri 18:00 – Euro area Flash Manufacturing, Services PMI For a move higher, we would like to see the EURO close above 1.0902. Should this occur, we will look for a move to 1.1033; and if momentum is very strong we cannot rule out a move to 1.1117. If the EURO cannot close above 1.0902, we could see a move back down into 1.0814. If this market continues to sell-off a move lower into 1.0652 is very possible; and if momentum is very strong to the downside we could see a fast and sharp move down into 1.0525. GBP/USD – 1.2101 ( -305 or -2.46% ) Cable is drifting lower having broken through key levels discussing this market again in the LIVE CHAT ROOM this week. VOLATILITY ALERTS: Wed 16:00 – Prelim GDP (quarterly) Thu 20:30 – BoE Governor Bailey Speaks For a continued move to the upside, we need to see the Pound close above 1.2297. Should this occur we may see a move into 1.2480, and if momentum is very strong we cannot rule out further upside into 1.2720. If the Pound cannot close above 1.2297, we could see a move lower back down to 1.2080. A break of this level however sets up for a move down to 1.1896; and if momentum to the downside is very strong 1.1706 cannot be ruled out. USD/JPY – 107.09 ( +46 or +0.43% ) The $/YEN continues to travel sideways as it remains range bound. We will be discussing this in the LIVE CHAT ROOM this week. For a move to the upside we must now see this market close above 108.31. Should this occur we will look for a retest of 109.21, and if momentum is very strong we could see a move higher into 109.94 and potentially 111.73. If we cannot close above 108.31, we could see a move lower into 106.52. A break below this level may result in a sharp move lower into 105.50; and any further breaks to the downside may see a bigger move into 104.97. COMMODITIES GOLD – 1742 ( +41 or +2.41% ) Gold is testing the upside again as it threatens to break to new multi-year highs. For a continued move higher we must now see this market hold above 1724. Should this occur we could see a strong move to 1755; and any break of this level could see a stronger move to 1786. If Gold cannot hold above 1724, we will look for a move back down to 1674. A break below this level could see a move lower into 1648; and if momentum is very strong to the downside we could see a move to 1605.
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