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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 5593 ( + 68 or + 1.23% )
The ASX is edging higher slowly with only one volatile day on Thursday which saw buyers come into the market very quickly around the 5500 area which we mentioned last week would “be very important in determining the next direction for the ASX”
For the upmove to continue we would like to see a strong long up bar break and close above 5636 before pushing towards 5715 and then 5754. Once these levels are broken we could see the ASX reach 5789 which would complete the range.
For the downward move to restart we would like to see an early break and close past 5541 before reaching 5524 and 5505. Once this is broken the ASX will could find support near the area between 5463 – 44 again.
EUROPE
DAX – 11016 ( – 190 or – 1.70% )
De-ja Vue:
What a wild ride for the DAX traders last week as the DAX reached a low of 10805 and a high of 11285 all in one day.
If anyone says that there is no opportunity in the markets again they should take up another hobby.
With all that is Greece this week looks like it will come to a head.
Expect more Volatility this week. Therefore we will provide some outrages extension both on the long and short side.
For the upmove to restart we would like to see a strong break above 11079 followed by 11162. Once these levels are broken the DAX will need to close back up above the area between 11227 – 92. This could lead the DAX towards 11373. Once this level is broken we could see the DAX reach 11537 very quickly possibly extending towards 11621. If the Greek situation is sorted expect the DAX near 11868.
If the downside prevails then the levels we will be watching closely (depending on momentum) will be 10939, 10869, 10793, 10683 with a possible extension down towards 10473.
US
S&P – 2108 ( + 14 or + 0.67% )
Another rally past 2112 for the S&P shows signs that the market would like to go up.
Then we had a ‘Quadruple Witching’ Friday, which means that stock index futures, stock index options, stock options and single stock futures all expire on the same day. This happens four times a year on the third Friday of the last month of each quarter. Days like this typically produce downward moves which we saw on Friday.
But this time we have Greece and the Eurozone.
Fix it and we could see markets rally, break it and we could go down, down, down.
The two important levels that the S&P needs to break this week are 2112 and 2126. If the upward momentum is strong we could see 2137 broken with a long up bar reaching 2148. If the upward momentum is strong we will be watching 2173, 2180 and a possible extension towards 2191.
If the S&P finds 2112 hard to break early then a long down bar move could see 2101 very quickly. Once this occurs we could see 2085 and 2076 once again. if the downside moves become aggressive then the area between 2050 – 46 could be seen. We will also mention 2033 as an over extension just incase.
FOREX
AUD.USD – 7771 ( + 44 or + 0.57% )
The AUD had a interesting week with a couple of 100+ point days, still finishing slightly higher for the week.
For the upmove to continue we would like to see a strong break and close above 7778 again. Once this occurs then 7869 could be seen very quickly followed by 7926.
Our downside comments remain the same:
For the longer term downside move to continue a strong break past 7635 could see the AUD in a bit of a FREE FALL reaching 7498 very quickly. If the move is strong then it extend towards 7407.
EUR.USD – 11348 ( + 79 or + 0.70% )
The EUR moved higher again reaching a high of 11436 before falling back down to close below our FICM level of 11396.
If the EUR is to move back up again we would like to see a solid long up bar break and close past our FICM level of 11396. Once this is done then we could see 11471 followed by a strong move towards 11666 and finally completing the range at 11732.
If the EUR struggles again at our FICM level of 11396 then a strong break back down past 11166 could see it near 11038 very quickly. Once this is broken the downside move will reach its full range near the area between 10941 – 25.
GBP.USD – 15874 ( + 316 or + 2.03% )
The GBP is really going for it. Downside moves are brought back very quickly at the moment. Now that it has broken out of the Standard Deviation Channel to the upside expect continued strong moves higher with possible sharp reversal to follow the next day.
For the GBP to continue its run higher we would like to see 15834 hold as a strong level of support then we could see 16030 followed by 16100 then onto 16160 which will complete the range.
For the down move to restart then we would like to see a strong break past 15834 followed by a long down bar break and close past our FICM level of 15743. This could then lead the GBP towards 15643. Once this is broken we could see the pair settle near the area between 15591 – 49.
USD.JPY – 12268 ( – 71 or – 0.58% )
Another down week for the USD but not before an early attempt at a higher move.
For the USD to continue its longer term rally we need to see a strong up bar break through 12403 before reaching 12464. Once this level is broken we could see the pair near 12558 testing the last month’s highs.
For this pair to move back down we need to see another move past 12275 become a strong level of resistance before a move past 12225 is made. Once this occurs we will be watching the area between 12184 – 52 very closely for support.
COMMODITIES
GOLD – 1200 ( + 19 or + 1.61% )
With the possibility of a USD rate rise later than expected GOLD took a Bid and moved higher last week. Will this be enough to start the rally or will GOLD come back down and just settle near 1178 – 80 area?
For the upward move to continue we would like to see an early break past 1208 and 12016 before reaching 1225.
For the down move to restart and continue we would like to see GOLD break past 1192 reaching the area between 1180 – 78 again.
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