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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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We may take multiple trades throughout the week and discuss in our LIVE CHAT ROOM.
Trade View has entered the weekend Net Long.
AUSTRALASIA
ASX – 5411 ( – 107 or – 1.94% )
The ASX continued lower last week falling to a low of 5368 which was only 2 points above our FICM level of 5366. This level has played an important role in the past for support, lets see if it continues.
For the up move to restart we would like to see an early solid long up bar break and close past the area between 5447 – 62 before reaching another potential resistance area of 5505 – 24. Once the ASX pushes through this then we could see 5595 reached.
For the down move to continue the area between 5447 – 62 needs to become a solid level of resistance before another attempt at breaking through 5366 is made. Once this key FICM level is broken then we could see 5270 reached quickly. If the downward momentum continues strong then we could see the ASX near 5199 – 76.
EUROPE
FTSE – 6839 ( + 38 or + 0.56% )
A very interesting week for the FTSE with indecision all the way until Friday where we saw a 100 point range day. Now that the referendum is over, maybe some normality? As the FTSE has only closed 38 points higher our comments remain the same with slight amendments.
For the move higher to continue we would like to see a solid attempt at breaking through 6852 before a new attempt at breaking 6905 is made. If this occurs then 7044 could be the first level reached in a possible continuation of a new uptrend.
If the downside move takes full effect then a strong break and close past 6816 could lead the index to 6769 and possibly extend towards 6703. Once this level is broken then we will watch 6681 and 6652 before a possible support level is reached near 6632.
DAX – 9790 ( + 152 or + 1.58% )
After an initial down move we saw the DAX bounce off near our FICM level of 9580 with a low of 9582. Once this occurred we saw a strong rally pushing the DAX to a high of 9891 which was only 5 points below last weeks level of 9896 mentioned.
If the DAX continues higher we would like to see a strong break back up above 9829 before another attempt at breaking past 9896 is made. This level will then need to be broken with a long up bar before a move towards 9949 is made. If the upward momentum is strong then we could see 10035 again and possibly new ATH (All time highs) for the DAX
If the DAX restarts a move lower then we would like to see an early break back down past 9767 reaching 9737. Once this occurs then 9671 could be reached. If the DAX continues lower then we could see 9580 tested again.
US
S&P – 2009 ( + 25 or + 1.26% )
The S&P had a bit of a scare on Monday morning gapping down heavily before breaking back above the new psychological level of 2000. Last week we saw a quick rebound back to new ATH reaching 2022.20 which was only 0.80 points below our target level of 2023 mentioned in previous weeks.
For the up move to continue then we would like to see a strong break back above 2012 before attempting to break the ATH of 2022 – 2023. Once this level is broken and if the momentum continues strong we could see 2057.
Our downside comments remain the same as we see 1981 as the key level to break. For the down move to start we would like to see a strong break and close below 1981 before reaching 1968 again. If the downward momentum is strong then 1943 and 1927 could be reached.
FOREX
AUD.USD – 8925 ( – 111 or – 1.23% )
After an early start up the AUD fell away once again. With USD strength forming all over it will be hard for the AUD to gain upward momentum.
For the up move to restart we would like to see a solid long bar break and close back above 8971. This could then lead the pair towards 9096 before reaching 9176. Once this occurs then 9203 will be the talk of the town once again.
The AUD has now broken 8971, this will now need to become a solid level of resistance as the move down could be heavy breaching 8913 on its way down towards 8823. If the downside move it strong then we could see 8660 (lows from Jan 2014) tested over the next few weeks.
EUR.USD – 12827 ( – 136 or – 1.05% )
Another move lower for the EUR with USD strength continuing.
For an upmove to restart we would like to see 12763 become a strong level of support before a strong break back up early in the week past 12915 could lead the EUR up towards 13010 before reaching 13123. Once this level is broken the EUR could see resistance near 13162.
If we see continued strength in the USD and the EUR takes another leg down then a break past 12763 could reach 12625. If the break past 12625 is strong with momentum then expect the EUR to begin a FREE FALL.
GBP.USD – 16285 ( + 20 or + 0.12% )
The GAP fill continued last week and even pushing past 16500 on Friday. But this was short lived as “BUY – the rumour” (referendum vote ‘NO’) and “SELL – the fact” (referendum vote ‘NO’) came into play as traders started to realise that no matter what we have USD strength.
For the GBP to move higher we would like to see a solid start to the week with 16280 holding as a solid level of support before the up move breaks past 16333 reaching 16395. Once this level is broken then 16458 could be seen and 16524 could be tested again.
If the GBP is to take another leg lower, we would like to see an early break past 16280 before another move lower through 16229 occurs. Once this level is breached then we would like to see another strong push past 16148 before it dips below and prints 15986. We will also be watching 15723 closely if the GBP decides to GAP again.
USD.JPY – 10904 ( + 168 or + 1.56% )
And….off she goes again.
For the USD to move higher we would like to see 10914 broken again early in the week followed by a strong push past 109.98 and popping its head above 110. Once this level is reached we will discuss the next possible levels in our LIVE CHAT ROOM.
If the down move restarts we would like to see an early break and close back past 10836 before reaching 10683. If this level is also broken then we could see 10541 provide some support.
COMMODITIES
GOLD – 1215 ( – 14 or – 1.14% )
“The less there is to worry about the more GOLD becomes unloved”
For the upward move to restart we would like to see 1215 hold as a strong level of support before an early break back past 1230 occurs, this would then allow for a solid break back above 1241 also breaking through 1252. Once this occurs we could see GOLD near 1274.
If a down move continues then we would like to see a strong break below 1215. If the momentum is strong then we could see GOLD below 1200 and possibly testing the lows of June 2013 and Dec 2013 of 1180 and 1182 respectively.
US LIGHT CRUDE OIL – 9168 ( – 55 or – 0.60% )
After an Initial move higher early in the week OIL simply fell away and gapped down on Friday closing at 9168 which only 21 points above our FICM level of 9147. Therefore our comments remain the same as last week. As mentioned last week “We would like to see a new formation occur before deciding on direction.”
For the upmove to continue we would like to see 9144 hold as a strong level of support before pushing back past and closing above 9336. Once this occurs we could see an explosive move through 9448 and 9557 reaching a strong level of resistance near the 9697 – 9721 area.
If OIL restarts another leg down then we would like to see 9144 broken with a long down bar. Once this occurs it could send OIL into a FREE FALL. This will be watched closely over the next few weeks. Levels to watch are 9058, 8973, 8844 and 8727.
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