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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 LIGHT NET LONG.
UPCOMING EVENTS
INTERMEDIATE WORKSHOP
MARCH 2016 – FULL
APRIL 2016 – 3 SEATS LEFT
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INDICES
AUSTRALASIA
ASX – 5127 ( +240 or +4.91% )
The ASX came within a few points of our 5161 level after a fantastic week long rally and is now testing long-term resistance.
VOLATILITY ALERT: NAB Business Confidence on Tuesday, Home Loans on Wednesday.
For a continued move higher we would like to see a strong break of 5161. If we can break strongly through this level we could see another move into 5238 before a pause. A strong break and close above 5238 could see the ASX head back up to 5294, and if momentum remains strong we may see the rally continue into 5372.
If we fail to break 5161, we will be looking for a move back down to 5090. A strong break and close below 5090 could see a quick move back down to 4997, and a strong break and close below this level may result in a sharp move back down to 4921. A break below this level may then send the ASX all the way back down to 4890 should we see a complete V-reversal this week.
EUROPE
DAX – 9775 ( +305 or +3.22% )
We had been alerting members that the DAX is gearing up for a big 400-500 point day, and we were not left wanting for more last Tuesday! Now the question remains- what will Draghi do this week? We will be monitoring this closely in the LIVE CHAT ROOM.
VOLATILITY ALERT: ECOFIN meetings on Tuesday, ECB Interest Rate & Press Conference on Thursday.
For a continued move to the upside we would like to see a strong break and close above 9822. Should this occur we may likely re-test 9907; and a strong break through this level may see a quick move into 10013 before a pause. If momentum remains strong, 10131 and 10158 are important levels to watch and if Draghi’s statement is extremely positive for equities, we would not rule out a blow-off move into 10382.
On the downside, if we fail to break above 9822 we will be looking for a move back down to 9620. A strong break below this level could see the DAX trade all the way back down to 9560; and if momentum remains strong we will look for a move back down to 9386.
US
SP500 – 1996 ( +52 or +2.67% )
We continue see the S&P leading the equities complex, and it too is now at an important levels following last week’s NFP. This week there is very little US news so markets are likely to be sentiment driven.
For a move higher we would like to see a strong break and close above 2002, followed by this level holding as support. Should this occur we could see a move into 2019, and if momentum remains strong we could see a strong push back into the important 2040 level.
For a move to the downside we will need to see a strong break and close below 1990. A strong break below this level may likely see the S&P move lower to 1986, and a strong break below this level could easily see the S&P back down to 1968-1972. Should momentum on the downside continue we will not rule out a move back down to 1948.
FOREX
AUD/USD – 0.7436 ( +310 or +4.35% )
The Aussie dollar has broken out to the upside as we repeatedly stated in our MEMBER PORTAL and this week will be critical should the AUD/USD wish to follow through.
VOLATILITY ALERT: NAB Business Confidence on Tuesday, Home Loans on Wednesday.
For a move higher we would now like to see the AUD hold above 0.7389, followed by a strong break and close through 0.7447. A break above this level may then see the AUD head to 0.7489 before a pause. Should momentum remain strong, we will look for a move higher into 0.7561 and if the rally continues we may see a strong push into 0.7645.
On the downside, a strong break below 0.7389 may see the AUD head back down to 0.7365. A strong break and close below this level could result in a move down to 0.7305, and if this move turns into a false breakout we could see a move back down into 0.7229 – 0.7236.
EUR/USD – 1.1006 ( +77 or +0.7% )
Once again the EURO perfectly bounced within our levels all week and is now in a precarious position going into this week’s ECB rate announcement. This is a BIG week for the EURO so BE PREPARED!
VOLATILITY ALERT: ECOFIN meetings on Tuesday, ECB Interest Rate & Press Conference on Thursday.
For a sustained move higher we would like to see a strong break and close above 1.1033, followed by a break of 1.1064. Should this occur we could see moves back up into 1.1163 and 1.1201 before a pause. If momentum to the upside remains strong we will look for further moves higher into 1.1248; and if there is no stopping the upside we could see strong moves into 1.1347 and 1.1385.
On the downside, a strong break back below 1.0977 could see the EURO head back down to 1.0897 very quickly. A break below this level may result in a retest of 1.0814, and if there is continued downside pressure we will then look for a move down into 1.0743 – 1.0734. Further breaks of these levels could result in a very fast and sharp move, all the way back down to 1.0636.
GBP/USD – 1.4232 ( +362 or +2.61% )
The GBP is attempting to reverse its course as we head into another big week, following the V-Reversal we hinted at last week.
VOLATILITY ALERT: Carney speaks on Tuesday, Manufacturing numbers on Wednesday, Trade Balance on Friday.
For a move to the upside we would like to see 1.4223 hold as support, followed by a strong break through 1.4259. Should this occur we will look for a move back up into 1.4399 before a pause. A break above this level could see cable quickly reach 1.4469, and if momentum is very strong we could see a push all the way up into 1.4630.
On the downside, a break below 1.4194 could see the GBP head back down to 1.4079 and 1.4039. A strong break below these levels may result in further downside to 1.3853; and if momentum to the downside continues we may see a sharp move down to 1.3725 – 1.3743.
USD/JPY – 113.78 ( -19 or -0.17% )
Up, Down, Up, Down. A sideways week for the USD/JPY and as such our comments remain unchanged.
VOLATILITY ALERT: Kuroda speaking on Monday.
For a continued move to the upside we would like to see a strong break and close above 114.14. A break above 114.14 could result in a retest of 114.55, and if momentum remains strong we could see a move higher into 115.05 and 115.53 before a pause. If momentum to the upside is very strong we may see fast and sharp moves into 116.08 and 117.41.
If the USD/JPY cannot close above 114.14, we will be watching for a move back down to 113.37. A strong break and close below this level could see the USD/JPY move down to 112.40. If momentum to the downside continues we may see a retest 111.73. and 111.09. A break below this level could see a fast and sharp move all the way down to 109.94.
COMMODITIES
GOLD – 1258 ( +36 or +2.95% )
Gold continues to inch its way higher but like other markets, it too is now at some very important levels. Is a short-term high in? Will be discussing this in our MEMBER PORTAL.
For a continued move higher we would like to see 1258 hold as support, followed by a strong break and close through 1276. Should this occur we could see a strong move to 1294, and a break of this level could see a move into 1303 before another pause. If momentum to the upside remains very strong we could see another blow-off type move into 1322.
If Gold cannot break above 1276, we will look for a strong break below 1258 followed by a move back down to 1247. A strong break and close below this level could see Gold trade back down to 1222; and an additional break of this level could be the start of a fade move back down to 1206.
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