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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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Trade View has entered the weekend Net Long.
AUSTRALASIA
ASX – 5569 ( + 99 or + 1.81% )
The ASX rebounded strongly last week following through on Fridays up move.
For the up move to continue we would like to see a strong level of support near 5541 – 62 before a push higher with momentum reaches and test’s 5645 again. If the momentum continues strong then an ambitious push towards 5732 could be made.
For the down move to restart we would like to see 5525 broken early with a long down bar followed by a further push past 5497 before settling near 5447.
EUROPE
FTSE – 6701 ( + 104 or + 1.58% )
In the past few weeks we have mentioned that “the FTSE is struggling at the moment and the only thing that will help it go higher is if the rest of the world markets move higher.” and ….the rest of the world markets moved higher.
For the move higher to continue then we would like to see a solid move past 6738 and 6792 before attempting to reach 6816 and possibly 6851.
If we see another down move start then 6681 would need to be broken early in the week followed by a test of 6632 on its way down to 6595.
DAX – 9132 ( + 49 or + 0.54% )
A rebound from the DAX was on the cards but then a possible escalation in the Ukraine conflict pushed it lower by 300 points from the high’s. The DAX has not followed the rebound from the lows by the other Indices as of yet. As mentioned before “the DAX has a long way before it catches up.”
If the DAX starts it move higher then we would like to see a solid break past 9201 with a long up bar. Once this level is broken then we could see a further push past 9321 – 59 area before possibly reaching 9401.
If the market continues lower then we would like to see another break down past 9114 before reaching and testing 8959. Once this level is breached then the levels of interest will be 8841, 8778 until 8520 is reached.
US
S&P – 1956 ( + 28 or + 1.45% )
Another strong rally by the S&P, but it is now obvious that the markets are very sensitive to the Ukraine situation as we say a 25 point drop on Friday as soon as news broke of possible escalation. Event risks can cause investors to rethink their positions.
For the up move to continue then we would like to see a strong break past 1964 reaching 1970. Once this level is broken 1981 will play a pivotal role in the next direction for the S&P.
If we see another downside move then 1943 will need to be broken early followed by 1922 before reaching 1909 again.
FOREX
AUD.USD – 9320 ( + 44 or + 0.47% )
“This pair is range bound and the 2 FICM levels we are looking for before a significant move occurs are 9203 and 9423. Until these 2 key levels are broken our comments remain the same.”
For the move higher to continue we would need to see an early break and close past 9423 and 9460 before the potential to reach 9539 could occur. Once this is reached the AUD could start a new phase and potentially new up trend.
If the USD finds strength and 9423 proves to be difficult to stay above, then a move past 9333 could reach 9287. If the downward momentum is strong then we would like to see a strong break and close past 9287 reaching 9203 were the AUD might find temporary support.
EUR.USD – 13399 ( – 11 or – 0.08% )
Not much occurred with the EUR this week therefore our comments remain the same.
For an up-move to restart we would like to see support near 13375 – 91. Once this is achieved we could see a move higher breaking past 13472 – 81 reaching 13513. If the upward momentum remains strong then we could see further breaks past 13554 and 13589 reaching 13620.
For the EUR to continue it’s move down then we would like to see a strong momentum break with a long down bar through 13391 – 75 reaching 13342. If the downward momentum takes hold and we see a free fall, the levels we will be monitoring are 13342, 13246 and finally 13104.
GBP.USD – 16691 ( – 82 or – 0.49% )
The GBP continued lower last week finding some support near the 15th April Low.
For the GBP to move higher we would like to see an early break past 16731 and 16774. Once this occurs then 16806 needs to be broken before reaching 16860.
For the GBP to continue its move lower we will be watching the following levels 16693, 16664, 16600 on its way down to 16537.
USD.JPY – 10235 ( + 35 or + 0.34% )
“The dollar yen is playing a game ‘tug of war’ at the moment as the USD wants to strengthen, but there are also global event risks attracting attention. The question is who will win the battle for safe haven plays in this environment?”
For the USD to move higher we would like to see a strong break above 10270 pushing towards 10309. It is important for the pair to break past 10309 this week before 10356 is reached. This level will then need to be broken with a long solid up bar before we see 10410.
If the down move restarts we would like to see another break back down past 10192 followed by a strong break past 10152 – 69 area reaching 10052. If 10052 is then broken with a long solid down bar we could see 9982 – 77.
COMMODITIES
GOLD – 1304 ( – 5 or – 0.38% )
Last week saw GOLD experience some volatility when the Ukraine situation came to the forefront. It still settled on 5 points lower so our comments from last week remain the same
For the upward move to restart we would like to see a solid break and close above 1312. If the upward momentum is strong then 1330 could be tested next. As this market is event driven at the moment, breaks past 1330 could be very strong reaching 1360 (if the situations get completely out of hand).
If a down move restarts we would like to see a strong break and close past 1295 before reaching 1285. If the momentum is strong the we could see a strong break past 1274 before reaching 1264. Once this level is also broken we could see 1252.
US LIGHT CRUDE OIL – 9716 ( – 35 or – 0.36% )
OIl had an interesting week last week. We saw a 200+ point move one day followed by a complete rebound the next.
For the upmove to restart we would like to see 9699 – 9721 become a strong level of support before a move higher past 9821 occurs. Once this level is reached and broken we could see OIL reach 99.42 and possibly break back into the $100 a barrel reaching 100.16.
If the move lower takes another leg down then we would like to see a solid break past 9699 before reaching 9646. Another long down bar break past 9646 could lead OIL on a bit of a FREE FALL past 9445 on its way to 9365.
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