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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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Trade View has entered the weekend Net Long.
AUSTRALASIA
ASX – 5666 ( + 140 or + 2.53% )
The ASX gained strong momentum last week breaking higher after a tough few weeks. It reached a high of 5696 which is only a few points from the high of 5708 set in June. This level could test the ASX this week but if broken could become the next level of solid support.
For the upmove to continue we need to see our FICM level of 5636 hold as a strong level of support before an attempt at breaking through the June high of 5708 is made. The 5708 – 18 area would need to be broken with a long up bar reaching 5754. If the momentum continues we could see the ASX near 5789 very quickly.
If the ASX finds it difficult to break above the area between 5708 – 18 and we see a sharp reversal and break below 5636 then the ASX could find itself back at 5595 before you blink. If the downward momentum is strong and 5541 does not provide any support then we could see the area between 5524 – 05 reached before the ASX finds support near 5463 – 44 again.
EUROPE
DAX – 11679 ( + 289 or + 2.54% )
Another strong move higher by the DAX as the Greece scenario is avoided (for now)
As mentioned in our ‘Greece Is The Word’ article, “We believe that despite their huge debt and whether or not Athens will make good on their promise of repayments, Greece will remain part of the European Union.”
For the upmove to continue we would like to see a strong early move past 11791 continuing and closing through both 11843 and 68. Once this occurs this area will need to become a solid level of support before we see a strong push reaching 12015.
If the DAX finds it difficult to break past 11843 and the downside move restarts then a strong long down bar break past 11621 and 11537 could see the DAX back down near 11373 very quickly.
US
S&P – 2125 ( + 49 or + 2.36% )
After a few days bouncing off our FICM level of 2046, POP goes the S&P all the way back above 2112 and reaching a high of 2126 which was our upper level mentioned last week.
If the upward move continues through this week then we would like to see an early move reaching 2137 followed by 2148. Once 2148 is broken we could see the S&P reach the area between 2173 – 80 with a possible extension towards 2191.
If the S&P finds it difficult to stay above 2112 for long then a clear long down bar break will could start a more significant long term down move. First reaching 2101 followed by a break down through the 2085 -76 area.
FOREX
AUD.USD – 7371 ( – 70 or – 0.94% )
The AUD is in a bit of a downward spiral atm and with possible rate hikes by the US Fed expect it to continue.
For the upmove to restart we would like to see a strong break and close back above 7407 before reaching 7494. If the momentum is strong then we could see 7635.
For the downside move to continue then an early long down bar could see 7263 followed by 7116 which is now in line with levels back in early 2009.
EUR.USD – 10828 ( – 327 or – 2.93% )
With Greece sorted the EUR can continue on its way down again (for now).
If the EUR is to move back up again we would like to see a solid break and close past 10925 before push back above 110038. If the upward momentum is strong then we could see 11166.
If last weeks downside move is continued then a strong long down bar break past 10780 could start a FREE FALL reaching 10590 first followed by 10452.
GBP.USD – 15603 ( + 93 or + 0.60% )
The GBP found some support last week moving higher after bouncing off our FICM level of 15458 to then settle 93 points higher for the week.
For the GBP to continue this move higher we need to see 15644 broken early with a long up bar reaching our upper FICM level of 15744. Once this is reached it needs to be broken with a long up bar before it can see 15834.
For the down move to restart we would like to see 15549 broken early in the week reaching our lower FICM level of 15458. This level will then need to be broken with a long down bar so that it can reach 15366 again.
USD.JPY – 12406 ( + 128 or + 1.04% )
The USD showed its strength last week pushing higher once again, now moving over 400 points in 2 weeks.
For the USD to continue its longer term rally we need to see a strong up bar break through 12464 before reaching 12558 again and testing the highs of June 2015.
For this pair to move back down we need to see a strong move back past the area 12346-24 before reaching 12275. if this too is broken then we could see 12225.
COMMODITIES
GOLD – 1134 ( – 29 or – 2.49% )
Now that the World is ok again GOLD took another leg down last week, closing at 1134 which was our level mentioned in last weeks brief.
NOTE: GOLD is now at the lows of NOV 2014. We saw a big 40 point reversal bar when this occurred.
For the upward move to restart we would like to see a repeat of the the NOV lows price action which as mentioned was a 40 point reversal bar. If this occurs GOLD will be back near 1177 – 80 area which was a level of support on a number of occasions. If this level is also broken then we could see GOLD reach 1187 and possibly 1197.
If the downside move continues then a strong break down past Fridays lows of 1131 will create a FREE FALL down to 1103 with a push past 1100 reaching 1091.
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