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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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
ASX – 5851 ( +5 or +0.09% )
The ASX finished the week pretty much where it started and so our levels remain the same. We will be discussing this in the LIVE CHAT ROOM this week.
VOLATILITY ALERT: Quarterly CPI on Wednesday.
NOTE: Tuesday is a public holiday (ANZAC Day)
For a continued move higher we must now see the ASX break and close above 5921. Should this occur we will look for a move to 5985. A break through this level could see a retest of 6000; and if momentum is very strong we cannot rule out a move to 6140.
If the ASX cannot close above 5921, we will look for a move back down to 5823. A strong break and close below this level could see the ASX test 5777, and if momentum is strong we could quickly see further moves down to 5746 and 5705.
EUROPE
DAX – 12085 ( -6 or -0.05% )
Like the ASX the DAX regained most of its early week losses to finish the week flat. With the outcome of the French elections to be announced soon we could see big moves in the DAX this week. We will be discussing this in the LIVE CHAT ROOM this week.
VOLATILITY ALERT: German IFO Business Climate on Monday, German Prelim CPI and ECB Interest Rate Announcement on Thursday.
For a continued move to the upside we must see the DAX hold above 12198. Should this occur a break and close above 12381 sets up a scenario to retest the ALL-TIME HIGH’s at 12404. A strong break and close above this level could see a very quick move to 12714.
If the DAX fails to hold above 12198, we will look for a move back down to 12044. A strong break below this level is likely to see a push further down into 11875, and if downside pressure is strong this week a sharp move down to the 11788 – 11754 area cannot be ruled out.
US
SP500 – 2350 ( +20 or +0.86% )
Nothing has changed in the US, with the S&P continuing to maintain support levels. This week we have another heavy week of earnings and will be watching this market closely.
VOLATILITY ALERT: Consumer Confidence and New Home Sales on Tuesday, Advanced GDP and Chicago PMI on Friday.
For a move higher we must continue to see the S&P hold above our key level of 2334. Should this hold we will look for a move to 2376, and further breaks to the upside could see a retest of 2386. Should momentum to the upside remain strong, a move back up to 2400 cannot be ruled out.
If we cannot hold above 2334, WATCH OUT for sharp move down to 2312. A close below this level could see further downside to 2292, and if momentum to the downside is strong we may see a fast move down to 2270.
FOREX
AUD/USD – 0.7544 ( -34 or -0.45% )
The AUD continues to bounce in and out of our levels. We have key support at 0.7489 and should this hold we could see the Aussie Dollar rally from here.
VOLATILITY ALERT: Quarterly CPI on Wednesday.
NOTE: Tuesday is a public holiday (ANZAC Day)
For a move higher we would like to see this market now break and close above 0.7561. Should this occur we will look for a retest of 0.7617. A strong break and close above this key level could see this market rally to 0.7677 before a pause.
If we cannot close above 0.7561, we will look for a retest of the key 0.7489 support area. A close below 0.7489 may then result in a move down to 0.7447. Should we break strongly through this level, we cannot rule out a sharp move down to 0.7364 by the end of this week.
EUR/USD – 1.0723 ( +113 or +1.07% )
Going into this week all eyes will be on the outcome of the French Election. In premarket trade this morning we are seeing the EURO up 200points, trading in the low 1.10’s! We will be discussing this market extensively in the MEMBER PORTAL this week.
VOLATILITY ALERT: German IFO Business Climate on Monday, German Prelim CPI and ECB Interest Rate Announcement on Thursday, Annual CPI Flash Estimate on Friday.
We will be covering the ECB Interest Rate Announcement LIVE in LiveTV this week.
As this market has gapped substantially to the upside, we will now look for the EURO to hold above the key 1.0977 level this week. Should this occur, we anticipate 1.1054 may come into play and if the EURO can break and close above this level a move to 1.1123 cannot be ruled out.
Given this market has gapped substantially to the upside in pre-market trade, we will now be watching key levels for a potential fade down to 1.0902, 1.0814 and finally a potential full fade to 1.0738.
GBP/USD – 1.2803 ( +281 or +2.24% )
The GBP blasted rallied strongly through last week’s DOUBLE TOP area on the back of a snap election called by PM Theresa May. Last week we said we are monitoring this market closely for an explosive breakout (or reversal) and that’s exactly what we saw.
VOLATILITY ALERT: Prelim quarterly GDP on Friday.
For a move to the upside we would like to this market hold above 1.2720. Should this occur we will look for a retest of 1.2868, and if momentum remains very strong we cannot rule out a move to 1.3035.
If the GBP cannot hold above 1.2720, we will look for a move back down to 1.2571. A close below this level could result in a strong move back down to 1.2480 and thus a full fade of the snap election rally.
USD/JPY – 108.99 ( +39 or +0.36% )
The $/YEN is now at a major area of support and if it can hold here we may see a multi-week rally. However should we break lower WATCH OUT! We will be discussing this in the LIVE CHAT ROOM this week.
VOLATILITY ALERT: BoJ Monetary Policy Rate and Statement on Thursday, Household Spending on Friday.
For a move to the upside we will look for this market to hold above our key level at 108.31, followed by a strong break and close above 109.21. Should this occur we will look for a move back up to 109.94 before a pause. If momentum remains strong to the upside, we will look for a move to 111.09 before the week’s end.
If we cannot hold above 108.31, the YEN may see further downside into 107.75. A strong break and close below this level could spell trouble for the YEN, with a very fast move down to 105.45.
COMMODITIES
GOLD – 1284 ( -3 or -0.23% )
Litke $/YEN, GOLD is also at a very ker area, having consolidated all week in a very tight range. We are near a very key area (1276 – 1278) and will be watching these levels closely this week.
For a continued move higher we would like to see this market hold above 1278, followed by a retest of 1294. A strong break above 1294 could see this market head back up to 1303, and if momentum remains strong we could see a move into 1313 before another pause.
If Gold cannot hold above 1278, we will look for a strong move back down into 1263 and 1257. A break and close below this level could then result in a move to 1247 before the week’s end.
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