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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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INDICES
AUSTRALASIA
ASX – 5850 ( +21 or +0.36% )
The ASX encountered strong technical resistance last Thursday; and as such only managed to close 21 points higher despite an attempted rally early in the week.
NOTE: Wednesday is a public holiday (Anzac Day)
VOLATILITY ALERTS:
Tue 11:30 – CPI (quarterly)
For a continued move higher we must now see the ASX hold above 5823. A strong close above this level could see a move to 5921 and 5985. Should we break through 5985 we may see a quick retest of 6000; and if momentum is very strong we cannot rule out a move to 6140.
If the ASX cannot hold above 5823, we will look for a move back down to 5777 and 5746. A strong break and close below this level could see the ASX test 5703, and if momentum is strong we could quickly see a further move down into 5668.
EUROPE
DAX – 12525 ( +79 or +0.63% )
For the second straight week the DAX was again one of the out performers however things may get interesting this week. We will be discussing this in more detail in the LIVE CHAT ROOM.
VOLATILITY ALERTS:
Mon 17:30 – German Flash Manufacturing PMI
Mon 17:30 – German Flash Services PMI
Tue 18:00 – German IFO Business Climate
Thu 21:45 – ECB Interest Rate Announcement – LIVE TV
Thu 22:30 – ECB Press Conference
For a continued move to the upside we must now see the DAX hold above 12384. Should this occur we will look for a retest of 12566. A strong break of this level could then see the DAX rally quickly to 12640; and if momentum to the upside is very strong we cannot rule out a move to 12714.
If the DAX fails to hold above 12384, we could see a move back down into 12205; with a break below paving the way for a move down into 12115 before a pause. A break below this level however could result in a quick move into 12040, and if momentum to the downside is very strong we cannot rule out a move back down to 11875.
US
SP500 – 2671 ( +13 or +0.49% )
The S&P has also met resistance at our key 2704 level. We will be discussing the impact of this in the LIVE CHAT ROOM this week.
VOLATILITY ALERTS:
Tue 00:00 – Existing Home Sales
Wed 00:00 – CB Consumer Confidence
Thu 22:30 – Core Durable Goods Orders (monthly)
Fri 22:30 – Advance GDP (quarterly)
For a move higher we would like to see the S&P hold above 2660. Should this occur we will look for a retest of the key 2680 level. A strong break and close above this level could see another retest of 2704, and if momentum remains strong to the upside we cannot rule out moves to 2720 and 2736.
If we cannot hold above 2660, we could see this market continue to sell-off into 2638. A strong break through this level however could quickly see a move down to 2590 before a pause. If momentum to the downside is strong we may see a move lower into 2562; and a close below this level may result in a move down to 2540.
FOREX
AUD/USD – 0.7668 ( -93 or -1.2% )
The Aussie Dollar failed to reach our important 0.7830 level and was consequently sold off aggressively on Thursday and Friday. We will discuss this move down in more detail in the MEMBER PORTAL this week.
NOTE: Wednesday is a public holiday (Anzac Day)
VOLATILITY ALERTS:
Tue 11:30 – CPI (quarterly)
For a move higher we must now see this market close above 0.7729; followed by a retest of 0.7833.Should this occur we will look for this market to retest 0.7903; and if momentum is very strong we cannot rule out a move back up to 0.7988 and 0.8033.
If we cannot close above 0.7729, we will be watching how this market reacts to 0.7662. A break below this level may see a quick move into 0.7620; and if selling pressure is strong a move into 0.7600 and 0.7561 cannot be ruled out.
EUR/USD – 1.2287 ( -43 or -0.35% )
This week is an important week for the EURO and we will be covering this market exclusively in the LIVE CHAT ROOM.
VOLATILITY ALERTS:
Mon 18:00 – Euro Flash Manufacturing PMI
Mon 18:00 – Euro Flash Services PMI
Thu 21:45 – ECB Interest Rate Announcement – LIVE TV
Thu 22:30 – ECB Press Conference
For a sustained move higher we would like to see the EURO hold above 1.2266 followed by a strong break through 1.2360. Should this occur, we will then look for this market to test 1.2420; and if momentum is very strong we could see a push higher into 1.2520.
If the EURO cannot close above 1.2266, we could see a move back down 1.2165 before a pause. This is an important level and any subsequent strong break and close below this level may see the EURO sell-off further into 1.2042 this week.
GBP/USD – 1.4003 ( -235 or -1.65% )
The Pound’s third attempt at a breakout has proved to be unsuccessful and with four consecutive days of selling this market is becoming interesting.
VOLATILITY ALERTS:
Fri 18:30 – Prelim GDP (quarterly)
Sat 00:00 – BoE Gov Carney Speaks
For a move to the upside we would like to see the GBP/USD close above 1.4075. Should this occur we may then see a move into 1.4194. However a strong break and close above 1.4194 could result in a quick move back up into 1.4305; and if momentum is very strong 1.4469 cannot be ruled out.
If we cannot close above 1.4075 we will look for continued selling back down into 1.3875 before a pause. A strong break below this level may see Cable trade further down to the important 1.3743 – 1.3725 area; and if this level is breached WATCH OUT BELOW!
USD/JPY – 107.63 ( +27 or +0.25% )
The $/YEN is again attempting to break to the upside however struggling to break through 107.75.
VOLATILITY ALERTS:
Fri 12:00 – BoJ Interest Rate Announcement
For a continued move to the upside we would now like to see the market hold above 107.36, followed by a strong break and close above 107.75. Should this occur we could then see a quick move into 108.31. If momentum is very strong, we cannot rule out a move to 109.21 by the end of the week.
If however the USD/JPY cannot hold above 107.36, we could see a move back down into 106.30 and subsequently 105.79. A break below this level could then see the USD/JPY trade quickly down to 104.97 before a potential pause.
COMMODITIES
GOLD – 1335 ( -10 or -0.74% )
Once again Gold continues to bounce in and out of our levels, having failed at 1355 and all but closing near our key 1333 level.
For a continued move higher we must now see this market hold above 1333. Should this occur we will look for a retest of 1355, and a close above this level could see further upside into 1365. If momentum remains very strong, we could see a big push into 1374 and 1394.
If Gold cannot hold above 1333, we will look for a strong move back down into 1322. A strong break below this level could see GOLD sell off further into 1303, and if momentum is strong to the downside we may see a sharp move down into 1294.
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