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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes. For up to the minute market analysis see our live trading room.
INDICES
AUSTRALASIA
ASX – 7229 (0)
The ASX closed completely flat on the week but momentum remains to the upside.
VOLATILITY ALERTS:
Thurs 11:30 – Employment Change and Unemployment Rate
For a move higher we would like to see the ASX close above 7310. Should this occur, a move above 7385 should be expected; and if momentum is strong we cannot rule out moves to 7465 and 7555.
Failure to hold above 7310 means a potential move into 7215. 7135 is the next support level down if 7215 doesn’t hold. If downside momentum is really strong then we could see another leg down into 7030.
EUROPE
DAX – 15628 (-17 or -0.11%)
The DAX also closed almost flat as it tries to secure a clean breakthrough new yearly highs.
For the DAX to move higher we would like to see it hold above 15515. Should this occur then 15650 is the next level ahead. If upside momentum is strong then 15820 and 15970 cannot be ruled out.
To the downside, should we not see it hold above 15515, we will look for a move into support at 15325. A strong break and close below this handle and 15025 is the next level down. If downside pressure mounts then 14800 cannot be ruled out.
US
S&P 500 – 4111 (+2 or +0.05%)
Another index closed flat and our levels remain the same.
VOLATILITY ALERTS:
Weds 22:30 – CPI and Core CPI M/m & Y/y
Thurs 04:00 – FOMC Minutes
Thurs 22:30 – PPI and Core PPI M/m & Y/y
Fri 22:30 – Retail Sales and Core Retail Sales M/m
Sat 00:00 – Prelim UoM Consumer Confidence
For a move higher we would like to see the S&P hold above 4095. Should this occur, we will look for a move to 4145, and if momentum is strong we cannot rule out moves to 4215 and 4320.
If we cannot hold above 4095, we could see this market move down into 3965. A break of this level, however, may result in a quick move down to 3915; and if momentum to the downside remains strong we may see a fast move back down to 3810.
FOREX
AUD/USD – 0.6663 (-22 or -0.33%)
The Aussie Dollar edged slightly lower but is still range trading right now.
VOLATILITY ALERTS:
Thurs 11:30 – Employment Change and Unemployment Rate
For a move higher this week we would like to see it close above 0.6670. We will then be targeting a move through 0.6715. If we see a strong break and close above this level then we can’t rule out a move to 0.6825. Should momentum to the upside be really strong then 0.6870 could be targeted.
If this market cannot close above 0.6670, we could see a move down into 0.6585. A strong break of this level may result in a move into 0.6525, however, any weakness below this level could see a sharp drop into 0.6385.
EUR/USD – 1.0898 (+57 or +0.53%)
The Euro edged higher again but was still unable to break through the early-year highs.
VOLATILITY ALERTS:
Weds 22:30 – US CPI and Core CPI M/m & Y/y
For a move higher we would like to see the Euro hold above 1.0760. Should this occur we should see a move above 1.0940. A break of this level could see this market rally further to 1.1115 and 1.1215.
If the EURO cannot hold above 1.0760 we will see a move into 1.0600. A strong break of this level may result in a move into 1.0470, however, any weakness below this level could see a move into 1.0355.
GBP/USD – 1.2416 (+87 or +0.71%)
The Cable looked like it would soar through major resistance and start a new trend higher… what we got was a false breakout.
VOLATILITY ALERTS:
Weds 23:00 – BoE Gov Bailey speaks
Thurs 16:00 – GDP m/m
For a move to the upside, we would like to see Cable hold above 1.2400 before a break higher into 1.2600. If this market can see a strong close above this level we may then see a strong push back into 1.2755 If upside momentum is really strong then a move back into 1.2975 can’t be ruled out.
Should we fail to hold above 1.2400, we will look for a move down to 1.2275. A break below this level however could see Cable further depreciate to 1.2145 by the week’s end and if momentum is very weak we cannot rule out a move to 1.1930.
USD/JPY – 132.14 (-68 or -0.51%)
The Dollar Yen edged lower as choppy market conditions continue for this pair.
VOLATILITY ALERTS:
Weds 22:30 – CPI and Core CPI M/m & Y/y
Thurs 04:00 – FOMC Minutes
Thurs 22:30 – PPI and Core PPI M/m & Y/y
Fri 22:30 – Retail Sales and Core Retail Sales M/m
Sat 00:00 – Prelim UoM Consumer Confidence
For a move to the upside, we must now see this market close above 132.50. Should this occur we will look for a move into 134.50, and if upside momentum is strong we could see a move higher into 137.55 and potentially 139.10.
If we cannot close above 132.50, we could see a move back to test 131.40 before a pause to the downside. A break below this level may result in a sharp move lower into 129.50, and any further breaks to the downside may see a bigger move into 127.20.
COMMODITIES
GOLD – 2007 (+30 or +1.52%)
A failed break of 2000 means questions is being asked of whether there is enough now to push to new all-time highs.
VOLATILITY ALERTS:
Weds 22:30 – CPI and Core CPI M/m & Y/y
Thurs 04:00 – FOMC Minutes
Thurs 22:30 – PPI and Core PPI M/m & Y/y
Fri 22:30 – Retail Sales and Core Retail Sales M/m
For a move higher we need to see this market hold above 2000. Should this occur we could see a move into 2014; and any break of this level could see a stronger move into 2050. If momentum is strong then 2075 cannot be ruled out.
If Gold cannot hold above 2000, we can see a move down to 1960. A break below this level could see a move lower into 1910; and if momentum is very strong to the downside we could see a move to 1870.
CRYPTOS
BITCOIN – 27940 (-989 or -3.42%)
BTC continues to hold up well and has started the week in a strong fashion.
For a move higher we must now see this market hold above 28000. Should this occur we could see a move into 31050 before retesting 32590. If upside momentum is really strong then we can’t rule out 36850.
Failure to hold above 28000 could see a move into 25875. If selling pressure takes control then we could see a move down to 23675. A close below this level and 21715 can’t be ruled out. 20000 is the more psychological handle below that.
