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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 7067 ( +66 or +0.94%)
The ASX continues to slowly grind higher – will it follow the U.S. markets lead and get through resistance this week?
VOLATILITY ALERTS:
Mon – 11:30 – Retails Sales M/m
For a continued move higher we would like to see the ASX close above 7091. Should this occur, a move to the all time highs at 7202 should be expected; and if momentum is very strong we cannot rule out moves to 7272.
Failure to close above 7091 means a potential move back into 6969. 6850 is the next support level down if 6969 doesn’t hold. If downside momentum is really strong then we could see a sharp move to 6804.
EUROPE
DAX – 15389(+243 or +1.6% )
The DAX saw a midweek V reversal while holding onto the trend line support – are we set for a push into all time highs this week?
VOLATILITY ALERTS:
Tues 19:05 – Zew Economic Sentiment Indicator
Weds 16:00 – CPI M/m and Y/y
For the DAX to continue its move higher we first want to see it hold above 15345. Should this occur then 15500 is the next technical level ahead. If upside momentum really takes hold then 15782 cannot be ruled out.
To the downside, should we see a rejection from 15345, we will look for a move into support at 15050. A strong break and close below this handle and 14990 is the next leg down. If downside pressure mounts then 14790 cannot be ruled out.
US
S&P 500 – 4235 (+42 or +1% )
Data miss or data beat, the S&P continues to rally to new all time highs – it would take a brave trader to get in front of this market at the moment.
VOLATILITY ALERTS:
Weds 00:00 -Jolts Job Openings
Weds 22:30 – Core CPI M/m
Thurs 22:30 – Core PPI M/m
Fri 22:30 -Retails Sales M/m
For a move higher we would like to see the S&P hold above 4200. Should this occur, we will look for a move to 4251; and if momentum is very strong we cannot rule out moves to 4435.
If we cannot close above 4200, we could see this market move back down into 4155. A break of this level however may result in a quick move down to 4117; and if momentum to the downside remains strong we may see a fast move back down to 4050.
FOREX
AUD/USD – 0.7843 ( +131 or +1.7% )
The Aussie Dollar continues to trade within its range – will the weaker USD post NFP see the AUD break out to the upside? Or is the China relations breakdown a cause for concern?
VOLATILITY ALERTS:
Mon – 11:30 – Retails Sales M/m
For a move higher this week we would like to see it hold at 0.7823. We will then be targeting a move back into 0.7997. If we see a strong break and close above this level then we can’t rule out a move to 0.8132.
If this market cannot hold 0.7823, we could see a move back down into 0.7729 before a pause. A strong break of this level may result in a move into 0.7660, however any weakness below this level could see a sharp drop into 0.7562.
EUR/USD – 1.2163 (+142 or +1.18% )
The Euro climbed higher thanks to a weak USD post NFP – it appears upside momentum could continue for now.
For a move higher we would like to see the EURO hold above 1.2113. Should this occur we could see a move into 1.2170. A break of this level could see this market rally further to 1.2222; and if momentum is very strong, 1.2353 cannot be ruled out.
If the EURO cannot close above 1.2113, we could see a move back down into 1.2000 before a pause. A strong break of this level may result in a move into 1.1925, however any weakness below this level could see a sharp drop into 1.1833.
GBP/USD – 1.3988 ( +174 or +1.26%)
Similarly, the GBP benefited from a USD sell off to retest a big resistance level on Friday – can it finally break through this week? We will be discussing this in our LIVE CHAT ROOM this week.
VOLATILITY ALERTS:
Weds 16:00 – GDP Q/q and M/m, Manufacturing Production M/m
For a move to the upside, we would like to see Cable close above 1.4000, before a break higher through 1.4125. If this market can hold above this level we may then see a strong push into 1.4250.
Should we fail to hold above 1.4000, we will look for a move down to 1.3865. A break below this level however could see Cable further depreciate to 1.3755 by the week’s end and if momentum is very weak we cannot rule out a move to 1.3666.
USD/JPY – 108.58 ( -75 or -0.69% )
The USD endured a sell off after the large NFP miss on Friday – have we seen a lower higher printed last week? We will be discussing this further in our LIVE CHAT ROOM this week.
VOLATILITY ALERTS:
Weds 00:00 – Jolts Job Openings
Weds 22:30 – Core CPI M/m
Thurs 22:30 – Core PPI M/m
Fri 22:30 – U.S. Retails Sales M/m
For a move to the upside we must now see this market hold above 108.60. Should this occur we will look for a retest of 109.21, and if momentum is very strong we could see a move higher into 109.68 and potentially 109.94.
If we cannot hold above 108.60, we could see a move lower into 107.81 before a pause to the downside. A break below this level may result in a sharp move lower into 106.97; and any further breaks to the downside may see a bigger move into 106.10.
COMMODITIES
GOLD – 1831 (+63 or +3.56% )
Gold enjoyed a strong end to the week and now faces a big test at down channel resistance. We will be discussing this throughout the week in our LIVE CHAT ROOM.
For a continued move higher we need to see this market hold above 1814. Should this occur we could see a move into 1850; and any break of this level could see a stronger move into 1875. If momentum is really strong then 1905 cannot be ruled out.
If Gold cannot hold above 1814, we will look for a move back down to 1800. A break below this level could see a move lower into 1755; and if momentum is very strong to the downside we could see a move to 1700.
CRYPTOS
BITCOIN – 59040 ( +2840 or +5.05% )
Bitcoin moved higher again as it looks to recover from the recent sell off – despite underperforming several other cryptos in recent times. We will be discussing what this means in our LIVE CHAT ROOM this week.
For a move higher we must now see this market hold above 55415. Should this occur we could see a move into 56781 before retesting 60000. If upside momentum is really strong then we can’t rule out 65000.
Failure to hold at 55415 could see a move down to 53000. If selling pressure takes control then we could see another big test of support at 46192. A close below this level and 44098 can’t be ruled out.
