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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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
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INDICES
AUSTRALASIA
ASX – 6372 (-17 or -0.27%)
The ASX is range bound again; have we seen an end to this short-term correction? We will be discussing this market in the LIVE CHAT ROOM this week.
VOLATILITY ALERTS:
Tue 11:30 – Retail Sales, Trade Balance
Tue 14:30 – RBA Interest Rate Announcement
Fri 11:30 – RBA Monetary Policy Statement
For a continued move higher we must now see the ASX hold above 6350. Should this occur we will look for a test of 6435, and if momentum to the upside is very strong we cannot rule out a move to 6500.
If the ASX cannot hold above 6350, we will look for a move back down to 6276 for strong support. A strong break and close below this level however could see the ASX retest 6180, and if downside momentum is very strong we could see a move down to 6140.
EUROPE
DAX – 12444 (+134 or +1.09%)
The DAX closed the week strong and with 5 straight UP days. How high can this market go?
VOLATILITY ALERTS:
Wed 21:30 – ECB Monetary Policy Meeting Accounts
For a continued move to the upside we must see the DAX hold above 12384. Should this occur we will look for a move into 12566 before a pause. If momentum is very strong we cannot rule out a blow off move to 12750.
If the DAX fails to hold above 12384, we will look for a move back down to 12198. Any break below this level however could see the DAX sell-off sharply into 12044 this week.
US
SP500 – 2947 (+8 or +0.27%)
The S&P has finally broken to new all time highs! We will be discussing what this week should look like in the MEMBER PORTAL.
VOLATILITY ALERTS:
Thu 22:30 – Fed Chair Powell Speaks, PPI (monthly)
Fri 22:30 – CPI (monthly)
For a move higher we would like to see the S&P hold above 2941. Should this occur we will look for a move into 2960 before a pause. A strong break above this level however sets the stage for a move higher into 2985 and 3000.
If we cannot hold above 2941, we could see this market sell-off into 2922 and then 2902 before another pause. A break of this level however may result in quick move down to 2870; and if momentum to the downside remains strong we may see a very sharp move down into 2838.
FOREX
AUD/USD – 0.7023 (–15 or -0.21%)
The Aussie dollar continues to trade at a critical level around 70c, and this will be a very important week for the Aussie dollar. We will be covering the importance of this in more detail in the MEMBER PORTAL.
VOLATILITY ALERTS:
Tue 11:30 – Retail Sales, Trade Balance
Tue 14:30 – RBA Interest Rate Announcement
Fri 11:30 – RBA Monetary Policy Statement
For a move higher, we would first like to see the AUD close above 0.7113. Should this occur we will look for a move into 0.7197, and if upside momentum remains strong we will look for 0.7229 – 0.7236 before a pause.
If the AUD cannot close above 0.7113, we will look for a move lower into 0.7014. A break and close below this level however could see a sharp decline into 0.6997. Any further breaks to the downside could then see the AUD quickly trade at 0.6958 and 0.6934; and if momentum to the downside remains strong we cannot rule out a move into 0.6830.
EUR/USD – 1.1202 (+58 or +0.52%)
The Euro is trying to find support at 1.1150; and the question now is can the bulls hold this market above 1.1200?
NOTE: Wednesday is a public holiday in France (Victory Day)
VOLATILITY ALERTS:
Wed 21:30 – ECB Monetary Policy Meeting Accounts
For a move higher we would like to see the EURO hold above 1.1197 early in the week. Should this occur we could see a retest into 1.1249 and any breaks above this level may mean a quick move into 1.1335 before a further pause.
If the EURO cannot hold above 1.1197, we could see another retest down into 1.1117 before another pause. A strong break of this level may result in a move into 1.1033 before the week’s end.
GBP/USD – 1.3175 (+261 or +2.02%)
Following an attempted push lower, Cable failed to break through 1.2868 and has rallied 300 points higher back to the previous range.
NOTE: Monday is a public holiday in the UK (May day)
VOLATILITY ALERTS:
Mon 18:10 – BoE Governor Carney Speaks
Wed 18:30 – Manufacturing PMI
Thu 21:00 – BoE Interest Rate Announcement
Fri 18:30 – Services PMI
For a continued move to the upside, we must now see Cable hold above 1.3110. Should this occur we will look for follow-through to 1.3277 this week. If momentum to the upside is very strong, we will look for a move to 1.3386.
On the downside, a close below 1.3110 could result in a move to 1.3035. A break below this level however could see this market retest the important 1.2868. level; and if momentum to the downside is strong we cannot rule out a bigger move down to 1.2720.
USD/JPY – 111.10 (-45 or -0.4%)
The YEN is also now at a critical level sitting right above the important 111.09 support.
NOTE: Monday is a public holiday in Japan (Children’s Day).
For a move to the upside we must now see this market close above 111.73. Should this occur we could see a strong move into 112.22. A strong break and close above this level could then see the $/YEN rally into 112.68, and if momentum is extremely strong to the upside 113.27 cannot be ruled out.
If we cannot close above 111.73, we are likely to see a break of 111.09 which could see a fast move down to 110.67. If the downside remains very strong we cannot rule out a sell-off into 109.94.
COMMODITIES
GOLD – 1278 (-7 or -0.54%)
Last week we stated Gold had put in a swing bottom. This week we now find this market with a double bottom.
For a continued move higher we must now see this market and hold above 1278. Should this occur we will look for a retest of 1294. A strong close above this level could see further upside into 1303; and if momentum remains very strong, we could see a big push into 1313.
If Gold cannot hold above 1278, we will look for a move back down into 1260. A strong break and close below this level however could see Gold trade quickly into 1247 before a pause.
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The views represented on this website do not contain (and should not be construed as containing) financial advice, recommendations, opinions in relation to acquiring, holding or disposing of a financial product of any kind, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Trade View Investments accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of the above information. Consequently any person acting on it does so entirely at his or her own risk. The research does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.
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