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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 7138 (-198 or -2.7%)
The ASX has fallen over 2%, following the trend of the overall markets.
VOLATILITY ALERTS:
Wed 11:30 – AUD RBA Judo Bank Manufacturing PMI
For a move higher, we would like to see the ASX close above 7138. 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) – 15609 (-268 or -1.69%)
Two weeks in a row the Dax has seen a bearish move. Will the uptrend lows at 15,440 hold their ground this week? Or shall we see a drop through to the 15,000 level
VOLATILITY ALERTS:
Wed 17:30 – EUR Manufacturing PMI
Wed 17:30 – EUR Services PMI
Sat 10:00 – EUR President Lagarde Speech
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 – 4377 (-98 or -2.19%)
The SPX has made its biggest consecutive down trend move since March. Will the market repeat the previous dip buying? Or see the momentum continue to the downside?
VOLATILITY ALERTS:
Wed 22:30 – USD Existing Home Sales
Thur 22:30 – USD Initial Jobless Claims
Fri 23:55 – USD Fed Powell Speech
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 4412. And if momentum is strong, we cannot rule out moves to 4480 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 – 0.6413 (-66 or -1.02%)
The AUDUSD has been gaining downward momentum in a 30 day down trend. What will the catalyst be to start the reversal? Will the happen before reaching last years lows of 0.6150
VOLATILITY ALERTS:
Wed 11:30 – AUD RBA Judo Bank Manufacturing PMI
Wed 22:30 – USD Existing Home Sales
Thur 22:30 – USD Initial Jobless Claims
Fri 23:55 – USD Fed Powell Speech
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 – 1.0881 (-56 or -0.51%)
Slowly following the trend of the markets which has been seen has USDollar strength, the EURUSD is moving into its trend support area around 1.06
VOLATILITY ALERTS:
Wed 17:30 – EUR Manufacturing PMI
Wed 17:30 – EUR Services PMI
Sat 10:00 – EUR President Lagarde Speech
Wed 22:30 – USD Existing Home Sales
Thur 22:30 – USD Initial Jobless Claims
Fri 23:55 – USD Fed Powell Speech
For a move higher, we would like to see the Euro close above 1.088. Should this occur, we should see a move above 1.100. A break of this level could see this market rally further to 1.106 and 1.115.
If the EURO cannot close above 1.088, we will see a move into 1.080. A strong break of this level may result in a move into 1.077, however, any weakness below this level could see a move into 1.072.
GBP/USD – 1.2747(+65 or +0.51%)
GBPUSD has closed a small weekly Bullish bar, being one of the only USD crosses to close a weekly bullish bar, is this a sign to come?
VOLATILITY ALERTS:
Wed 16:00 – GBP Manufacturing PMI
Fri 16:00 – GBP Consumer Confidence
Wed 22:30 – USD Existing Home Sales
Thur 22:30 – USD Initial Jobless Claims
Fri 23:55 – USD Fed Powell Speech
For a move to the upside, we would like to see Cable hold above 1.2724 before a break higher into 1.2881. If this market can see a strong close above this level, we may then see a strong pushback into 1.3029. If upside momentum is really strong, then a move back into 1.3136 can’t be ruled out.
Should we fail to hold above 1.2724, we will look for a move down to 1.2659. A break below this level, however, could see Cable further depreciate to 1.2579 by the week’s end. And if momentum is very weak, we cannot rule out a move to 1.2530.
USD/JPY – 145.49 (+59 or +0.41%)
The USDJPY up trend momentum continues to hold its ground and our levels stay unchanged.
VOLATILITY ALERTS:
Wed 22:30 – USD Existing Home Sales
Thur 22:30 – USD Initial Jobless Claims
Fri 23:55 – USD Fed Powell Speech
For a move to the upside, we must now see this market close above 144.79. Should this occur, we will look for a move into 145.56, and if the upside momentum is strong, we could see a move higher into 146.09 and potentially 147.00.
If we cannot close above 144.79, we could see a move back to test 143.95 before a pause to the downside. A break below this level may result in a sharp move lower into 142.98, and any further breaks to the downside may see a bigger move into 140.66.
COMMODITIES
GOLD – 1890 (-22 or -1.15%)
GOLD has made an impressive downward move, being in the same channel for 30+ days. Are Gold bulls buying the dip?
For a move higher, we need to see this market close above 1890. Should this occur we could see a move into 1900; and any break of this level could see a stronger move into 1926. If momentum is strong, then 1944 cannot be ruled out.
If Gold cannot close above 1890, we can see a move down to 1882. A break below this level could see a move lower into 1866 and if momentum is very strong to the downside, we could see a move to 1856.
CRYPTOS
BITCOIN – 26098 (-3288 or -11.19%)
Bitcoin has dropped a massive -11% within the last trading week. Will the momentum continue to the downside? Or will the Bulls swoop in to buy the dip?
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.
