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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 7151 (+13 or +0.18%)
The ASX has stayed in a small range bound movement after seeing nearly a 2% drop the previous week.
VOLATILITY ALERTS:
Mon 11:30 – AUD Retail Sales
Tue 11:30 – AUD Monthly CPI
Fri 9:00 – AUD Bank Manufacturing PMI
For a move higher, we would like to see the ASX close above 7161. Should this occur, a move above 7196 should be expected, and if momentum is strong, we cannot rule out moves to 7221 and 7256.
Failure to close above 7138 means a potential move into 7112. 7093 is the next support level down if 6991 doesn’t hold. If downside momentum is really strong then we could see another leg down into 6854.
EUROPE
DAX (30) – 15717 (+108 or +0.69%)
With a high volatility news week coming, will the DAX hold its current levels? Our levels stay unchanged.
VOLATILITY ALERTS:
Mon 17:30 – EUR Consumer Confidence
Wed 18:00 – EUR CPI
Thu 16:00 – EUR Retail sales
Thu 19:00 – EUR Unemployment Rate
Thu 19:00 – EUR Inflation Rate
Fri 18:00 – EUR Manufacturing PMI
For the DAX to move higher, we would like to see it close above 15600. Should this occur, then 15791 is the next level ahead. If upside momentum is strong, then 15849 and 16000 cannot be ruled out.
To the downside, should we not see it hold above 15600, we will look for a move into support at 15396. A strong break and close below this handle and 15243 is the next level down. If downside pressure mounts, then 15087 cannot be ruled out.
US
S&P 500 – 4409 (+32 or +0.73%)
The SPX has closed higher this week regaining some of its earlier losses.
VOLATILITY ALERTS:
Wed 22:30 – USD ADP Employment Change
Wed 22:30 – USD Goods Trade Balance
Thu 22:30 – USD Initial Jobless Claims
Fri 22:30 – USD Non Farm Payrolls NFP
Fri 22:30 – USD Unemployment Rate
For a move higher, we would like to see the S&P hold above 4375. Should this occur, we will look for a move through 4480. And if momentum is strong, we cannot rule out moves to 4518 and 4600.
If we cannot hold above 4375, we could see this market move down into 4339 A break of this level, however, may result in a quick move down to 4245. And if momentum to the downside remains strong, we may see a fast move back down to 4005.
FOREX
AUD/USD – 0.6418 (+5 or +0.08%)
Coming into a high volatility week with news, the AUDUSD is sitting at its lows. Could traders be waiting on the incoming news results?
VOLATILITY ALERTS:
Mon 11:30 – AUD Retail Sales
Wed 11:30 – AUD CPI Indicator
Fri 9:00 – AUD Bank Manufacturing
Wed 22:30 – USD ADP Employment Change
Wed 22:30 – USD Goods Trade Balance
Thu 22:30 – USD Initial Jobless Claims
Fri 22:30 – USD Non Farm Payrolls NFP
Fri 22:30 – USD Unemployment Rate
For a move higher this week, we would like to see it hold above 0.6411. We will then be targeting a move through 0.6507. If we see a strong break and close above this level, then we can’t rule out a move to 0.6550. Should momentum to the upside be really strong, then 0.6676 could be targeted.
If this market cannot hold above 0.6411 we could see a move down to 0.6327. A strong break of this level may result in a move into 0.6274, however, any weakness below this level could see a sharp drop into 0.6214.
EUR/USD – 1.0800 (-81 or -0.74%)
Will the EURUSD breakout of its current downtrend channel?
VOLATILITY ALERTS:
Mon 17:30 – EUR Consumer Confidence
Wed 18:00 – EUR CPI
Thu 16:00 – EUR Retail sales
Thu 19:00 – EUR Unemployment Rate
Thu 19:00 – EUR Inflation Rate
Fri 18:00 – EUR Manufacturing PMI
Wed 22:30 – USD ADP Employment Change
Wed 22:30 – USD Goods Trade Balance
Thu 22:30 – USD Initial Jobless Claims
Fri 22:30 – USD Non Farm Payrolls NFP
Fri 22:30 – USD Unemployment Rate
For a move higher, we would like to see the Euro close above 1.080. Should this occur, we should see a move above 1.090. A break of this level could see this market rally further to 1.106 and 1.115.
If the EURO cannot close above 1.080, we will see a move into 1.077. A strong break of this level may result in a move into 1.072, however, any weakness below this level could see a move into 1.071.
GBP/USD – 1.2595 (-152 or -1.19%)
GBPUSD has closed 1% lower in the past week.
VOLATILITY ALERTS:
Wed 22:30 – USD ADP Employment Change
Wed 22:30 – USD Goods Trade Balance
Thu 22:30 – USD Initial Jobless Claims
Fri 22:30 – USD Non Farm Payrolls NFP
Fri 22:30 – USD Unemployment Rate
For a move to the upside, we would like to see Cable hold above 1.2579 before a break higher into 1.2659. If this market can see a strong close above this level, we may then see a strong pushback into 1.2724. If upside momentum is really strong, then a move back into 1.2926 can’t be ruled out.
Should we fail to hold above 1.2579, we will look for a move down to 1.2540. A break below this level, however, could see Cable further depreciate to 1.2485 by the week’s end. And if momentum is very weak, we cannot rule out a move to 1.2433.
USD/JPY – 146.48 (+99 or +0.68%)
The USDJPY up trend momentum continues to hold its ground.
VOLATILITY ALERTS:
Wed 22:30 – USD ADP Employment Change
Wed 22:30 – USD Goods Trade Balance
Thu 22:30 – USD Initial Jobless Claims
Fri 22:30 – USD Non Farm Payrolls NFP
Fri 22:30 – USD Unemployment Rate
For a move to the upside, we must now see this market close above 146.09. Should this occur, we will look for a move into 147.59, and if the upside momentum is strong, we could see a move higher into 148.06 and potentially 148.92.
If we cannot close above 146.09, we could see a move back to test 144.79 before a pause to the downside. A break below this level may result in a sharp move lower into 143.95, and any further breaks to the downside may see a bigger move into 142.98.
COMMODITIES
GOLD – 1915 (+25 or +1.32%)
GOLD is up over 1% this past week, breakout out of a downtrend channel. Will the momentum continue?
For a move higher, we need to see this market close above 1915. Should this occur we could see a move into 11926; and any break of this level could see a stronger move into 1944. If momentum is strong, then 1981 cannot be ruled out.
If Gold cannot close above 1915, we can see a move down to 1892. A break below this level could see a move lower into 1882 and if momentum is very strong to the downside, we could see a move to 1856.
CRYPTOS
BITCOIN – 26022 (-76 or -0.29%)
After dropping 11% the prior week, Bitcoin has stayed relatively flat while traders digest the big drop.
For a move higher, we must now see this market close above 26000. Should this occur, we could see a move into 27000 before retesting 28000. If the upside momentum is really strong, then we can’t rule out 30000.
Failure to close above 26000 could see a move into 25000. If selling pressure takes control, then we could see a move down to 23000. A close below this level and 22000 can’t be ruled out. 20000 is the more psychological handle below that.
