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Market Brief – Monday 13th May 2019

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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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

AUSTRALASIA

ASX – 6350 (-22 or -0.35%)

The ASX continues within a sideway range. Will this be the week it breaks out? We will be discussing this market in the LIVE CHAT ROOM this week.

VOLATILITY ALERTS:

Wed 11:30 – Wage Price Index (quarterly)
Thu 11:30 – Unemployment Rate
Sat ALL Day – Parliamentary Elections

For a continued move higher we must now see the ASX hold above 6350. Should this occur we will look for a test of 6435, and if momentum to the upside is very strong we cannot rule out a move to 6500.

If the ASX cannot hold above 6350, we will look for a move back down to 6276 for strong support. A strong break and close below this level however could see the ASX retest 6180, and if downside momentum is very strong we could see a move down to 6140.

EUROPE

DAX – 12187 (-257 or -2.07%)

The DAX was selling off aggressively last week but a strong reversal on Friday saw this market put in a short-term low. Can it hold?

VOLATILITY ALERTS:

Tue 19:00 – German ZEW Economic Sentiment
Wed 16:00 – German Prelim GDP (quarterly)
Thu 18:15 – German Buba President Weidmann Speaks

For a continued move to the upside we must see the DAX close above 12198. Should this occur we will look for a move into 12384 before a pause. If momentum is very strong we cannot rule out a blow off move to 12566 and 12750.

If the DAX fails to close above 12198, we will look for a move back down to 12044. Any break below this level however could see the DAX sell-off sharply into 11875 this week.

 

US

SP500 – 2886 (-61 or -2.07%)

The S&P has finally corrected off all-time highs and this sets up for a very interesting week this week. We will be discussing this in more detail in the MEMBER PORTAL.

VOLATILITY ALERTS:

Wed 22:30 – Retail Sales
Thu 22:30 – Building Permits, Philly FED Manufacturing Index
Sat 00:00 – Prelim UoM Consumer Sentiment

For a move higher we would like to see the S&P hold above 2902. Should this occur we will look for a move to 2922, and potentially 2941 again before a pause. A strong break above this level however sets the stage for a move higher into 2960 and 2985.

If we cannot close above 2902, we could see this market retest 2870.  A break of this level however may result in quick move down to 2838; and if momentum to the downside remains strong we may see a very sharp move down into 2812.

 

FOREX

AUD/USD – 0.7000 (-23 or -0.33%)

With the Aussie Dollar sitting right at 70c, things are heating up in this market. We will be discussing this in more detail in the MEMBER PORTAL.

VOLATILITY ALERTS:

Wed 11:30 – Wage Price Index (quarterly)
Thu 11:30 – Unemployment Rate
Sat ALL Day – Parliamentary Elections

For a move higher, we would first like to see the AUD close above 0.7014. Should this occur we will look for a move into 0.7113, and if upside momentum remains very strong we cannot rule out a move to 0.7197 – 0.7236 before a pause.

If the AUD cannot close above 0.7014, we will look for a move lower into 6958. A break and close below this level however could see a sharp decline into 0.6934; and if momentum to the downside remains strong we cannot rule out a move into 0.6830.

 

EUR/USD – 1.1234 (+32 or +0.29%)

The Euro continues to try and find support at the key 1.1200 level, and the bulls are doing their best to hold this level.

VOLATILITY ALERTS:

Tue 19:00 – German ZEW Economic Sentiment
Wed 16:00 – German Prelim GDP (quarterly)
Wed 19:00 – Flash GDP

For a move higher we would like to see the EURO hold above 1.1197 early in the week. Should this occur we could see a retest into 1.1249 and any breaks above this level may mean a quick move into 1.1335 before a further pause.

If the EURO cannot hold above 1.1197, we could see another retest down into 1.1117 before another pause. A strong break of this level may result in a move into 1.1033 before the week’s end.

 

GBP/USD – 1.3003 (-172 or -1.31%)

We expect some news out of the UK this week with rumors flying around about the credibility of what remains of Theresa May’s role and Cable is setting up for a move off this 1.3000 handle.

VOLATILITY ALERTS:

Tue 18:30 – Average Earnings Index (monthly), Unemployment Rate

For a continued move to the upside, we must now see Cable close above 1.3110. Should this occur we will look for follow-through to 1.3277 this week. If momentum to the upside is very strong, we will look for a move to 1.3386.

On the downside, if the Pound cannot close above 1.3110, this could result in a move to 1.2920. A break below this level however could see this market retest the important 1.2868. level; and if momentum to the downside is strong we cannot rule out a bigger move down to 1.2720.

 

USD/JPY – 109.97 (-113 or -1.02%)

The YEN is also now at a critical level having close below 110.00 albeit testing the low.

For a move to the upside we must now see this market close above 110.67. Should this occur we could see a strong move into 111.09 and 111.73. A strong break and close above this level however could see the $/YEN rally into 112.22, and if momentum is extremely strong to the upside 112.68 cannot be ruled out.

If we cannot close above 110.67, we are likely to see a break of 109.94 which could see a fast move down to 109.20. If the downside remains very strong we cannot rule out a sell-off into 108.33 by the end of the week.

 

 

COMMODITIES

GOLD – 1285 (+7 or +0.55%)

Gold is attempting to rally off its double bottom and once again is in a position to rally if buyers can hold support.

For a continued move higher we must now see this market and hold above 1278. Should this occur we will look for a retest of 1294. A strong close above this level could see further upside into 1303; and if momentum remains very strong, we could see a big push into 1313.

If Gold cannot hold above 1278, we will look for a move back down into 1260. A strong break and close below this level however could see Gold trade quickly into 1247 before a pause.

 

 

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The views represented on this website do not contain (and should not be construed as containing) financial advice, recommendations, opinions in relation to acquiring, holding or disposing of a financial product of any kind, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Trade View Investments accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of the above information. Consequently any person acting on it does so entirely at his or her own risk. The research does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.

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