Weekly Market Brief - with Text_Blog2

Market Brief – Monday 04th May 2015

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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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AUSTRALASIA

ASX – 5850  ( – 121 or – 2.03% )

The ASX past the magical 6000 level early in the week and then struggled to stay above. it actually fell away sharply breaking down through to a low of 5742 before rebounding back up to close above the all important 5790 FICM level. Once again this level will play its role in deciding direction.

Another Friday special to the upside could be enough to restart the upward momentum. if so then we would like to see 5790 hold as a strong level of support before another push past 5892 is made. Once this occurs we could see the ASX testing 5998 once again. This time the break through 5998 – 6000 needs to be strong, preferably with a long up bar reaching the area between 6108 – 47..

Once again 5790 will need to play its role as a key level, if the downside momentum is going to continue then we would like to see a long down bar break past this level. Once this is broken we could see 5754 and 5715 very quickly with a  possible extension down towards 5636.

EUROPE

DAX – 11491 ( – 321 or – 2.72% )

Continued uncertainty caused the DAX to have a 500+ point down day. In previous briefs we have mentioned that the DAX can move quickly and if you blink you’ll miss it, this was one of those times. Last week was just a warm up, this week will be the real test for the policy makers from both the Eurozone and the Greek Government.

Lets put some simple perspective on the situation:

May 6th – Greece needs to Pay the IMF 200 mill in Interest which they don’t have or can’t afford.

Eurozone technically cannot afford for Greece to leave as it could cause a ripple effect with others leaving, this would then put the Euro in jeopardy to survive.

We believe that “Grext” will not occur and the Eurozone will do what it takes to keep the Euro stable.

For the upmove to restart we would like to see 11621 broken early in the week followed by a strong push past 11791. If the momentum continues strong then we would like to see 11868 and 12015 broken with a long up bar before the DAX continues higher.

If a down move persists and no solution is found this week then a strong break past the area between 11292 – 57 could cause the DAX to reach 11080 very quickly. This could then lead it towards 10941 and finally 10869.

US

S&P – 2107 ( – 11 or  – 0.52% )

Another All-Time-High for the S&P last week but thats about it, then down, down, down, she went reaching a low of 2076 before a strong rebound back up above 2100 again. Its important to note then any drops atm are being bought back aggressively, if this continues then it supports a bullish tone.

For the S&P to now continue higher we would like to see 2112 broken early and then become a strong level of support before a break and close past 2126 occurs. If the upward momentum is strong we could see 2137 broken with a long up bar. This could then lead the S&P to overextend itself towards the area between 2173 – 80.

If the S&P cannot break back above 2112 then we could see a long down bar break reaching 2101 could be seen very quickly. Once this occurs we could see 2085 and 2076 once again. if the downside moves become aggressive then the area between 2050 – 46 could be seen.

FOREX

AUD.USD – 7847  ( + 27 or + 0.35% )

A strong move higher past 8000 by the AUD early in the week was short lived as it fell back down as quick as it moved up. As the AUD has closed only 27 points higher our comments from last week remain the same.

For the up move to continue we would like to see and early strong break past 7869 before reaching 7927. If the short squeeze continues then 8088 could be seen quickly

For the longer term downside move to restart we would like to see a strong down bar break 7778 pushing through 7718. Once this occurs we could see 7635 again.

EUR.USD – 11196 ( + 323 or + 2.97% )

Last week we said “The EUR shorts all over twitter are getting tested. The key now is will we see another break past 110?? We will say one thing, if it does get ready for a ‘POP’.

All we can say is that it will Interesting to say the least.

Be Prepared!!!!”

If last weeks 300+ point rally did not hurt then you are not trading in large enough size.

ONE OF MANY TRADES POSTED IN OUR MEMBER AREA:

SPREAD TRADE CLOSED: AUDUSD v EURUSD

AUDUSD – Short @ 7832 Closed @ 7867 = – 32 points

EURUSD – Long @ 10870 Closed @ 11239 = + 369 points

Total = 325 points

For the EUR to continue it’s move higher we would like to see an early break above 11315 before tested our next FICM level of 11396. This level will then need to broken with a long up bar if the EUR is to reach 11471.

For the longer term downleg to restart and continue would like to see an early break back down past 11166 leading towards 11038. Once this is broken then 110 comes back into play, break 110 and 10899 will be next.

GBP.USD – 15135 ( – 51 or – 0.34% )

Another strong rally early in the week for the GBP reaching a high of 15498, but then crash straight back down to close 50 points lower. Therefore our comments from last week remain the same.

For the GBP to continue its strong move up we would like to see a long upbar break and close past 15209. This will then need to become a solid level of support before a move towards 15280 is made. The upper levels we will monitor closely are 15366, two of our FICM levels 15458 and 15522.

For the down move to restart 15209 needs to become a solid level of resistance before a break back down past 15140 occurs. If the down move is strong then 14950 could be seen quickly.

USD.JPY – 12021 ( + 128 or + 1.08% )

The USD is definitely hard to hold down for long at the moment, once it reached our FICM level of 11867 it bounced higher quickly to close above 120 once again. We now see 11867 as being the key level to break

For the USD to continue its rally we would like to see a strong long up bar break through another all important key FICM level of 12064. Once this occurs the move higher could reach 12152. If this too is broken with a long up bar then 12184 could be first on its way towards 12275.

If its too hard for the USDJPY to break back above 12064 and we see a restart back lower then we would like to see a strong early break past 12018 followed by a break through the area between 11977 – 45. Once this occurs we are back down near 11867.

COMMODITIES

GOLD – 1178 ( – 1 or – 0.08% )

Pop and Drop, Last week saw GOLD Pop back up above 1200 before closing on our FICm level of 1178. As mentioned previously “GOLD will need to break an important level between 1178 – 80” if it is to continue lower.

For the upward move to restart then we would like to see 1178 – 80 become a strong level of support before a bounce towards 1192 is made. Once this occurs we could see 1208 again.

For the down move GOLD will need to break an important level between 1178 – 80. If this occurs with a long down bar then it could continue down towards 1167 and settling near 1149 again.

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