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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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. Currently Trade View is Light Net Long.
AUSTRALASIA
ASX – 5204
The ASX took a strong leg down last week reaching a low of 5144 reaching our FICM level of support that we mentioned last week. The ASX found it difficult to move higher in the previous weeks so we will be monitoring this down move with caution as it may be the start of a much larger move.
If we are to see an up move from here we would like to see 5201 hold as support before a move towards 5260-82 area is achieved. If this area is broken with long solid bars, then we could see 5368 reached. If the upward momentum continues with strength then we could see an ambitious target of 5424 reached.
If last week’s down move is the start of a bigger move then we would like to see the 5144 – 26 area broken early in the week before seeing 5087. If 5087 is broken then 5014 could be the next to fall. If the downward momentum is strong we could see the ASX fall below 5000 reaching 4983.
EUROPE
FTSE – 6571
The FTSE followed the direction of the other world indices last week and fell to a low of 6461 which was only 11 points away from reaching its full range set back in August.
If the 90 point upward move on Friday is to continue into this week then we would like to see a solid break past 6621 early in the week followed by a strong break with long up bars past 6657. Once this is achieved and 6657 holds as support, then we could see 6715 reached followed by 6740.
For the down move to continue we would like to see and early strong break past the 6563 – 41 area before seeing 6488 reached. If this level is then broken, then the FTSE might find some support near 6432 – 21 area. If this is not the case, and instead we see a strong break, then we will revise the levels for our subscribers in our member’s area.
DAX – 9197
We have said many times that the DAX is one to watch, and it certainly did not disappoint with a 350+ point down move during the week.
For the DAX to move higher from here we would like to see a strong break past 9244 followed by strong long upwards move through 9311 before reaching 9408. If this level is reached, we would like to see strong upward momentum reaching 9500 before settling just below near 9497.
If the DAX takes another leg down, then we would like to see 9113 broken early in the week followed by a strong break past 9001 with long solid down bars. This could then lead to an extension towards 8849.
US
S&P – 1805
After another intraday all time high of 1813 set by the S&P we saw a move down to a low of 1778, which was only 1 point away from our new FICM level created at the start of the week in red.
After Friday’s 20 point rally, if we are to see the S&P move higher this week, we would like to see a solid break and close past 1813 early in the week. This could extend it to reach the area of 1845 – 48.
If Friday was just a false rally and the down move is to restart, then we would like to see a break past 1796 before reaching and testing 1777 again. This time we need to see a solid break past 1777 with long down bars. if the downward momentum continues with purpose then 1740 – 39 will be the next lower target.
NASDAQ – 3503
The NASDAQ fell last week but not with the same momentum as some of the other world indices. It seems as though the NASDAQ is trying to lead this market and it’s doing a pretty good job at it.
If the up move is to continue, then we will be monitoring a break through the upper levels of the Standard Deviation Channel which could be near 3565 – 76 area. Once this is done then we will revise as we need to look at our proprietary model FICM to determine the process of how strong the upward momentum is.
For a down move to start we would like to see 3477 broken early in the week followed by a strong move past 3422 – 06 area before reaching 3398. If 3398 does not provide support then we could see a downward extension reach 3308.
FOREX
AUD.USD – 9098
The AUD experienced 150 point moves both up and down last week to only find it self closing less than 10 points lower. Therefore, our comments from the previous week have not changed.
For a new upmove to start we would like to see an early break past 9188 followed by a solid break past 9256 which could lead the pair to reach 9306. If this too is broken the 9371 could be the next test before 9400 is reached.
If the downtrend continues in the same fashion as the previous week, than a solid break past 9083 could start the move down towards 9011. If this level is broken and 8924 does not provide any support, then this could be the formation of a prolonged down move.
EUR.USD – 13590
The EUR continues to climb higher against all wishes. At Trade View we are monitoring these extended moves as when (not if) the USD strengthens we might see a very large adjustment.
For the EUR to continue its move higher, we would like to see an early break past 13742. If this level is then broken with long solid up bars we could see 13854 reached and possibly an over extension to 13927.
If the USD finds what it needs and continues with strength, then we would like to see a solid break down past 13599 followed by a move past 13515, which could then lead the way down to 13433. If this level is broken then 13397 could be reached.
GBP.USD – 16345
The GBP started the week strong but faded away towards the end of the week to only finish 15 points lower, and based on that our comments will remain the same from last week.
If the GBP continues to go higher, we would like to see 16427 broken with solid long up bars which could lead it to 16481 which would then complete the range. Revisions will be made after this level is broken.
For the down move to restart, we would like to see a break past 16260 followed by a strong break with solid long down bars through 16114 which could lead the pair back down near 16028 – 21 area which might be a first level of support.
USD.JPY – 102.86
The USD started the week quite strong but then fell away in the middle of the week before having another rally. At Trade View we will be watching closely, as the USD.JPY has closed above our FICM level of 102.51.
If the USD strength continues, then we need to see a solid break past 103.73 – 98 area before seeing 104.34 reached. If the upward momentum is strong then an ambitious level of 105.43 could be seen.
If 102.51 is broken again with long solid down bars, then we could see a downward move restart. If this occurs, then we would like to see 101.98 broken before a solid move down to 101.09 is achieved. If this level is also broken then 100.52 will come into play once more.
COMMODITIES
GOLD – 1227
GOLD continued lower at the start of the week but then settled into another sideways range. We will watch GOLD closely as it has the potential to make dramatic moves quickly, either up or down, and therefore our view will remain the same as last week.
If GOLD finds some strength and moves higher, then we would like to see a break past 1265 – 68 area before we see 1282. Once 1282 is broken, then 1320 could be seen. The area between 1320 – 36 could be a tough one to break.
If the down move continues, then a solid break past 1210 early in the week could lead the way to GOLD dipping below 1200 again and reaching 1179. If this too is broken then 1137 would complete the downward range.
US LIGHT CRUDE OIL – 97.74
OIL found its upward momentum last week and rallied 500+ points off its lows and settled just above our FICM level of 9744 which will play an important role this week.
For OIL to continue its move higher and restart a new uptrend then we would like to see if 9744 can provide a strong level of support followed by an early break past 9843 which could lead it to 9947. If 9947 is then broken with long solid up bars then we could see 100.36 and a possible restart of a new uptrend.
If the longer term down move is to restart then we would like to see an early break with long solid down bars past 9744 which could lead the commodity to reach 9564. If this level is then broken we could see some support found near 9486 – 55 area. If not then 9345 could be its last chance to hold before further moves down to 90.18.
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