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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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We may take multiple trades throughout the week and discuss in our LIVE CHAT ROOM.
Trade View has entered the weekend Net Long.
AUSTRALASIA
ASX – 5991 ( + 191 or + 3.29% )
Last week we mentioned that 5790 will become an important level, the ASX confirmed this as once it bounced off this level up she went touching 6000 and closing just below. Now 6000 is the key level to break.
For the ASX to continue this strong move higher we would like to see 5982 hold as a strong level of support before another break-through 6000 is made. Once this occurs we see the ASX reaching 6108 and possibly 6147.
If 6000 is too hard to break for the ASX and we see another move back down then we would like to see a strong long down bar break past 5982. If the downward momentum is strong then 5892 and 5842 could be seen. If the downside move is strong we still see 5790 playing an important role in the direction of this market.
EUROPE
DAX – 12020 ( + 73 or + 0.61% )
“The DAX is not waiting for anyone atm, it may pause for a second or two but once it catches it’s breath off it goes again. We feel that if these moves by the DAX are the real deal then the rest of the markets will need to catch up, either way get ready for some action over the next week or two.”
Now that the DAX took a breather mid week we will look for a strong upward break past 12164 before reaching 12460.
If the downside move is to start then we would like to see an early break past 11897 followed by a strong long downbar break past 11791 reaching 11621. Remember the DAX moves quickly, DON’T BLINK.
US
S&P – 2106 ( + 54 or + 2.63% )
In our DAX review we said “We feel that if these moves by the DAX are the real deal then the rest of the markets will need to catch up, either way get ready for some action over the next week or two.” and we saw it last week. The S&P moved higher after our primary model FICM indicated a potential slowdown of the downside move.
For the S&P to continue higher we would like to see a strong long up bar break past 2112 before reaching 2126 (this would be a new all time high). If the upside move is strong then we could see the S&P near 2173 very quickly.
For the down move to restart we would like to see 2112 become a strong level of resistance before a break down past 2101 is achieved. Once this occurs the area between 2085 – 76 could become temporary support on its way back to 2050.
FOREX
AUD.USD – 7773 ( + 138 or + 1.81% )
Last week saw the reverse of the previous weeks comments “An early leg down(up last week) followed by a strong leg up(down last week) and then back down (up last week), that my friend is price action at its best with the AUD finding volatility as the USD story intensifies.”
For the up move to restart we would like to see the 7718 hold as a strong level of support before a strong push is needed to reach 7927. The only way we see 8088 is by a strong short squeeze.
For the downside move to continue we would like to see a strong down bar break past 7718 before a continuation down towards 7494 can be achieved. Once this occurs we could see 7407 and if the momentum is strong then 7263 could be seen.
EUR.USD – 10821 ( + 325 or + 3.10% )
Our comments from last week – “If the FED’s tone re raising rates changes then we could see a massive short squeeze as everywhere we turn, we hear traders being short the EUR.” And there it is, as mentioned last week and a few weeks ago we saw the “short squeeze” with the EUR reaching 110.
For the EUR to continue higher we would like to see another attempt at moving past 10899 followed by another attempt at breaking 11038. Dare I say if the upward momentum is strong we could see the EURO extend towards 113150 or even 11396?
For the downleg to continue its long term move we would like to see a strong break past 10780 reaching 10590. If the momentum is strong we could see 10452 tested. Further downside levels we will be watching are 10283, 10206, 10121, 10044.
GBP.USD – 14956 ( + 217 or + 1.47% )
It does not take much to change sentiment in this market as the FED comments sparked massive moves again the USD. The GBP for example had a 529 point move in one day on the 18th March 2015. Are we starting to see Volatility back in the FX markets? We say Be Prepared!
For the GBP to restart its move higher we would to see 14950 hold as a strong level of support before another aggressive push is made reaching 15140 again continuing towards 15209.
For the down move to restart then we would like to see another solid long down bar past both 14950 and 14832 before reaching 14563.
USD.JPY – 12003 ( – 139 or – 1.14% )
The USD lost some of its steam last week as the FED is not sure when it will raise rates. But the event definitely brought some volatility back into the FX markets with wild swings by many USD related pairs.
For the USD to continue its long term rally we would like to see a strong long up bar break past our key FICM level of 12064 before moving onto 12184 and possibly 12275.
If the USDJPY restarts back lower then we would like to see strong early break and close past 11931. This could lead the pair to test another Key FICM level of 11813 before further downside breaks are made. If this is done with strong downward momentum then we will discuss it in our LIVE CHAT ROOM.
COMMODITIES
GOLD – 1182 ( + 25 or + 2.16% )
Last week we said “One note of caution, if the rate rise does not occur and the wording by the FED changes, be ready for a sharp reversal in many instruments, GOLD will be one of them.”
For the upward to have any chance we need to see the area between 1178 – 80 become a solid level of support before an attempt at reaching 1208 is made.
If last weeks move was just a short term short squeeze then a move back down could occur if we see a solid long down bar past the area between 1178 – 80 continuing down towards 1167 and settling near 1149 again.
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