Market Brief


Is the market becoming increasingly sensitive to central bank guidance at these elevated levels?

Could shifting rate expectations trigger a volatility expansion across European equities?

Read below what our desk thinks, and the important levels to watch this week.

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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 8657 (+49 or +0.57%)

The ASX pushed higher this week, posting steady gains and showing continued bullish momentum compared to last week.

VOLATILITY ALERTS:
Tue 10:30 – AUD Westpac Consumer Confidence Change

Thu 11:00 – AUD Consumer Inflation Expectations

Wed 11:00 – AUD Westpac Leading Index

For a move to the upside, we must now see this market close above 8679. Should this occur, we will look for a move into 8700, and if the upside momentum is strong, we could see a move higher into 8722 and potentially 8765.

If we cannot close above 8635, we could see a move back to test 8614 before a pause to the downside. A break below this level may result in a sharp move lower into 8592, and any further breaks to the downside may see a bigger move into 8549.

EUROPE

DAX (30) – 24225 (+197 or +0.82%)

The DAX continued trending higher this week, showing strong bullish momentum and building on last week’s gains.

VOLATILITY ALERTS:
Fri 00:15 – EUR ECB Interest Rate Decision

Fri 00:45 – EUR ECB Press Conference

Wed 20:00 – EUR Ifo Business Climate

For a move to the upside, we must now see this market close above 24286. Should this occur, we will look for a move into 24346, and if the upside momentum is strong, we could see a move higher into 24407 and potentially 24528.

If we cannot close above 24164, we could see a move back to test 24104 before a pause to the downside. A break below this level may result in a sharp move lower into 24043, and any further breaks to the downside may see a bigger move into 23922.

US

S&P 500 – 6821 (-42 or -0.61%)

The SPX moved lower this week, showing bearish pressure and losing ground compared to last week’s close.

VOLATILITY ALERTS:
Wed 00:30 – USD Non-Farm Payrolls

Fri 00:30 – USD CPI (Inflation)

Fri 00:30 – USD Initial Jobless Claims

For a move to the upside, we must now see this market close above 6838. Should this occur, we will look for a move into 6855, and if the upside momentum is strong, we could see a move higher into 6872 and potentially 6906.

If we cannot close above 6804, we could see a move back to test 6787 before a pause to the downside. A break below this level may result in a sharp move lower into 6770, and any further breaks to the downside may see a bigger move into 6736.

FOREX

AUD/USD –   0.6648 (+12 or +0.18%)
AUDUSD edged slightly higher this week, maintaining a mild bullish bias with modest upside momentum.

VOLATILITY ALERTS:
Tue 10:30 – AUD Westpac Consumer Confidence Change

Thu 11:00 – AUD Consumer Inflation Expectations

Wed 11:00 – AUD Westpac Leading Index

Wed 00:30 – USD Non-Farm Payrolls

Fri 00:30 – USD CPI (Inflation)

Fri 00:30 – USD Initial Jobless Claims

For a move to the upside, we must now see this market close above 0.6664. Should this occur, we will look for a move into 0.6681, and if the upside momentum is strong, we could see a move higher into 0.6698 and potentially 0.6731.

If we cannot close above 0.6631, we could see a move back to test 0.6614 before a pause to the downside. A break below this level may result in a sharp move lower into 0.6597, and any further breaks to the downside may see a bigger move into 0.6565.

EUR/USD – 1.1739 (+98 or +0.84%)

EURUSD climbed strongly this week, showing clear bullish momentum and a decisive move higher from last week.

VOLATILITY ALERTS:

Fri 00:15 – EUR ECB Interest Rate Decision

Fri 00:45 – EUR ECB Press Conference

Wed 20:00 – EUR Ifo Business Climate

Wed 00:30 – USD Non-Farm Payrolls

Fri 00:30 – USD CPI (Inflation)

Fri 00:30 – USD Initial Jobless Claims

For a move to the upside, we must now see this market close above 1.1768. Should this occur, we will look for a move into 1.1798, and if the upside momentum is strong, we could see a move higher into 1.1827 and potentially 1.1886.

If we cannot close above 1.1710, we could see a move back to test 1.1680 before a pause to the downside. A break below this level may result in a sharp move lower into 1.1651, and any further breaks to the downside may see a bigger move into 1.1592.

GBP/USD – 1.13368 (+44 or +0.33%)

GBPUSD moved higher this week, maintaining bullish momentum and extending gains from last week’s levels.

VOLATILITY ALERTS:

Thu 23:00 – GBP BoE Interest Rate Decision

Tue 18:00 – GBP Unemployment Rate

Fri 18:00 – GBP Retail Sales MoM

Wed 00:30 – USD Non-Farm Payrolls

Fri 00:30 – USD CPI (Inflation)

Fri 00:30 – USD Initial Jobless Claims

For a move to the upside, we must now see this market close above 1.3401. Should this occur, we will look for a move into 1.3435, and if the upside momentum is strong, we could see a move higher into 1.3468 and potentially 1.3535.

If we cannot close above 1.3335, we could see a move back to test 1.3301 before a pause to the downside. A break below this level may result in a sharp move lower into 1.3268, and any further breaks to the downside may see a bigger move into 1.3201.


USD/JPY – 155.77 (+60 or +0.39%)

USDJPY continued pushing higher this week, showing sustained bullish momentum and strength above recent levels.

VOLATILITY ALERTS:

Wed 00:30 – USD Non-Farm Payrolls

Fri 00:30 – USD CPI (Inflation)

Fri 00:30 – USD Initial Jobless Claims

For a move to the upside, we must now see this market close above 156.16. Should this occur, we will look for a move into 156.55, and if the upside momentum is strong, we could see a move higher into 156.94 and potentially 157.71.

If we cannot close above 155.38, we could see a move back to test 154.99 before a pause to the downside. A break below this level may result in a sharp move lower into 154.60, and any further breaks to the downside may see a bigger move into 153.83.

COMMODITIES

GOLD – 4304 (+98 or +2.33%)

Gold surged strongly higher this week, showing powerful bullish momentum and a clear upside breakout.

For a move to the upside, we must now see this market close above 4315. Should this occur, we will look for a move into 4326, and if the upside momentum is strong, we could see a move higher into 4337 and potentially 4358.

If we cannot close above 4293, we could see a move back to test 4282 before a pause to the downside. A break below this level may result in a sharp move lower into 4271, and any further breaks to the downside may see a bigger move into 4250.

CRYPTOS

BITCOIN –  87885 (-2109 or -2.34%)

Bitcoin sold off sharply this week, showing strong bearish momentum and a decisive break lower.

For a move to the upside, we must now see this market close above 88105. Should this occur, we will look for a move into 88324, and if the upside momentum is strong, we could see a move higher into 88544 and potentially 88983.

If we cannot close above 87665, we could see a move back to test 87446 before a pause to the downside. A break below this level may result in a sharp move lower into 87226, and any further breaks to the downside may see a bigger move into 86787.

DISCLAIMER

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