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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 7493 (+4 or +0.05%)
Another quiet week for the ASX as our levels remains the same.
VOLATILITY ALERTS:
Mon 09:00 – Commonwealth Market Manufacturing, Services and Composite PMI
Fri 11:30 – Retail Sales M/m
For a continued move higher we would like to see the ASX close above 7500. Should this occur, a move into 7600 could be expected; and if momentum is strong we cannot rule out moves to 7730 and 7750.
Failure to hold above 7500 means a potential move back into 7400. 7272 is the next support level down if 7202 doesn’t hold. If downside momentum is really strong then we could see a sharp move to 7000.
EUROPE
DAX – 15785 (-84 or -0.53%)
The DAX endured quite a bit of intraday volatility as the index is set to expand to 40 stocks in the coming week – we will discuss this further in our LIVE CHAT ROOM.
VOLATILITY ALERTS:
Mon 17:30 – Market Manufacturing, Services and Composite PMI
Tues 16:30 – GDP Q/q
Weds 18:30 – IFO Business Climate
For the DAX to continue its move higher we would like to see it close above 15800. Should this occur then 16000 is the next level ahead. If upside momentum is strong then 16157 cannot be ruled out.
To the downside, should we not see it close above 15800, we will look for a move into support at 15500. A strong break and close below this handle and 15345 is the next level down. If downside pressure mounts then 15050 cannot be ruled out.
US
S&P 500 – 4537 (+25 or +0.55%)
Despite a big NFP miss the SPX largely remained unchanged as more new all-time highs were set during the week.
VOLATILITY ALERTS:
Tues 00:00 – Existing Home Sales
Weds 00:00 – New Home Sales
Weds 22:30 – Durable Goods Orders M/m
Thurs 22:30 – GDP Q/q
Fri 22:30 – Core PCE Index M/m
For a move higher we would like to see the S&P hold above 4531. Should this occur, we will look for a move to 4550, and if momentum is very strong we cannot rule out moves to 4607.
If we cannot hold above 4531, we could see this market move down into 4500. A break of this level however may result in a quick move down to 4450, and if momentum to the downside remains strong we may see a fast move back down to 4421.
FOREX
AUD/USD – 0.7448 (+138 or +1.89%)
Another ripping week for the Aussie Dollar as the bulls are back in the room – can they hold onto some key levels this week to sustain the move higher?
VOLATILITY ALERTS:
Mon 09:00 – Commonwealth Market Manufacturing, Services and Composite PMI
Fri 11:30 – Retail Sales M/m
For a move higher this week, we would like to see it hold above 0.7423. We will then be targeting a move back into 0.7500 where we may see a pause. If we see a strong break and close above this level then we can’t rule out a move to 0.7561.
If this market cannot hold above 0.7423, we could see a move down into 0.7343. A strong break of this level may result in a move into 0.7250, however, any weakness below this level could see a sharp drop into 0.7065.
EUR/USD – 1.1878 (+83 or +0.7%)
Further softening of the USD saw the Euro take advantage but now faces a tough test at key resistance.
VOLATILITY ALERTS:
Mon 18:00 – Market Manufacturing, Services and Composite PMI
For a move higher we would like to see the Euro hold above 1.1833. Should this occur we could see a move into 1.1925 before a pause. A break of this level could see this market rally further to 1.2000; and if momentum is very strong, 1.2052 cannot be ruled out.
If the EURO cannot hold above 1.1833, we could see a move into 1.1738. A strong break of this level may result in a move into 1.1615, however, any weakness below this level could see a sharp drop into 1.1500.
GBP/USD – 1.3857 (+97 or +0.7%)
VOLATILITY ALERTS:
Tues 16:00 – Core CPI M/m
The Cable edged higher and now could be set to retest a key handle overhead – like the Euro and Aud will the GBP keep benefitting from a weaker USD?
For a move to the upside, we would like to see Cable hold 1.3755 before a break higher through 1.3865. If this market can see a strong close above this level we may then see a strong push back into 1.4000.
Should we fail to hold above 1.3755, we will look for a move down to 1.3666. A break below this level however could see Cable further depreciate to 1.3620 by the week’s end and if momentum is very weak we cannot rule out a move to 1.3534.
USD/JPY – 109.83 (-14 or -0.13%)
The Dollar Yen is stuck – further consolidation and indecision but is a breakout close? If so, which way?
VOLATILITY ALERTS:
Tues 00:00 – Existing Home Sales
Weds 00:00 – New Home Sales
Weds 22:30 – Durable Goods Orders M/m
Thurs 22:30 – GDP Q/q
Fri 22:30 – Core PCE Index M/m
For a move to the upside, we must now see this market close above 109.94. Should this occur we will look for a retest of 110.38, and if upside momentum is strong we could see a move higher into 111 and potentially 111.70.
If we cannot close above 109.94, we could see a move back to test 109.68 before a pause to the downside. A break below this level may result in a sharp move lower into 109.21, and any further breaks to the downside may see a bigger move into 107.81.
COMMODITIES
GOLD – 1827 (+9 or +0.5%)
A relatively quiet week leading into the NFP which led to a break higher but the Gold bugs face a tough battle here at the recent highs.
For a continued move higher we need to see this market hold above 1814. Should this occur we need to see a move through 1832; and any break of this level could see a stronger move into 1850. If momentum is really strong then 1875 cannot be ruled out.
If Gold cannot hold above 1814, we will look for a move back down to 1786. A break below this level could see a move lower into 1740, and if momentum is very strong to the downside we could see a move to 1720.
CRYPTOS
BITCOIN – 50825 (+4652 or +10.08%)
The 50k handle looks to have broken over the weekend as the bulls look to take another leg higher.
For a move higher we must now see this market hold above 50000. Should this occur we could see a move into 55000 before retesting 57545. If upside momentum is really strong then we can’t rule out 59068.
Failure to hold above 50000 could see a move down to 47500. If selling pressure takes control then we could see a move down to 44000. A close below this level and 40000 can’t be ruled out.
