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Market Brief – Monday 16th March 2020

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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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

MARCH 2020 SYSTEMS BUILDING WORKSHOP

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INDICES

 

AUSTRALASIA

 

ASX – 5649 ( -469 or -7.67% )

 

The ASX continues to selloff following the lead of overseas markets.

VOLATILITY ALERTS:
Tue 11:30 – Monetary Policy Meeting Minutes
Tue 11:30 – Unemployment Numbers

For a continued move higher we must now see the ASX close above 5921 followed by a push into 6070. Should this occur we will look for a move into  6140, and if momentum to the upside remains strong we cannot rule out a move to 6276.

If the ASX cannot close above 5921, we will look for a move back down to 5746. A strong break and close below this level could see the ASX retest lower into 5325, and if downside momentum is very strong we cannot rule out a move to 4537 and 4267.

EUROPE

DAX – 9666 ( -1880 or -16.28% )

 

The DAX is also continuing to fall after having its worst week on record for over 10 years.

VOLATILITY ALERTS:
Tue 19:00 – German ZEW Economic Sentiment

 

For a sustained move to the upside we would like to see 9248 hold as support and see a strong close back above 9888. If momentum to the upside remains strong we could see a fast move up to 10262before a break.

On the downside we are watching for a break and close below 9248. A strong break and close below this level could extend the DAX down to 9092. Further breaks below this level could see the DAX head to 9016. If momentum remains strong we could see a very quick move to 8890 before a pause.

US

SP500 – 2669 ( -295 or -9.95% )

 

The S&P is now approaching a very key area down below. We will be discussing this in the MEMBER PORTAL this week.

VOLATILITY ALERTS:
Tue 23:30 – Retail Sales
Thu 05:00 – FOMC Interest Rate Announcement

 

For a move higher, we would like to see the S&P hold above 2620 followed by a retest of 2720. Should this occur we will look for a retest of the key 2736 level. A strong break and close above this level could see another retest of 2758, and if momentum remains strong to the upside we cannot rule out a move to 2838.

If we cannot hold above 2620, we could see this market continue to sell-off whilst it remains below 2600. If momentum to the downside is strong we may see a move lower into 2408; and a close below this level may result in a very fast move down to 2322 and 2190.

FOREX

AUD/USD – 0.6178 ( -464 or -6.99% )

 

The Aussie Dollar is now back down to 2009 levels. We will be discussing the impact of this in the LIVE CHAT ROOM.  

VOLATILITY ALERTS:
Tue 11:30 – Monetary Policy Meeting Minutes
Tue 11:30 – Unemployment Numbers

For a move higher, we would first like to see the AUD hold above 0.6092. Should this occur, we will look for a retest of 0.6456, and if upside momentum remains very strong, we may see a push higher into 0.6592 before a pause.

If the AUD cannot hold above 0.6092, we could see this market break lower and test 0.5980. If momentum to the downside is very strong, 0.5865 cannot be ruled out. 

EUR/USD – 1.1100 ( -189 or -1.67% )

 

The EURO is still consolidating its big move higher despite increased volatility to the downside.

For a move higher this week, we would like to see the EURO hold above 1.1033 on its way to retesting 1.1117. Should this occur, we will look for a move to 1.1249; and if momentum is very strong we cannot rule out a move to 1.1346.

If the EURO cannot hold above 1.1033, we could see a move back down into 1.0977. If this market continues to sell-off a move lower into 1.0902 is very possible; and if momentum is very strong to the downside we could see a fast and sharp move down into 1.0814.

GBP/USD – 1.2272 ( -775 or -5.94% )

 

Cable was down significantly last week again following the news out of the UK surrounding the coronavirus. We will be discussing this market again in the LIVE CHAT ROOM this week.

VOLATILITY ALERTS:
Tue 20:30 – Average Earnings Index

For a continued move to the upside, we need to see Cable hold above 1.2297 followed by a close above 1.2389. Should this occur we will love for a move back up into 1.2480, and if momentum is very strong, we could see a push higher into 1.2622.

If the Pound cannot hold above 1.2297, we are likely to see a quick move down into 1.2195. A break below this level could see a fast move down to 1.2000, and if momentum is strong to the downside we could see a fast move down into 1.1896.

USD/JPY – 108.00 ( +268 or +2.54% )

 

They $/YEN was the weakest of the majors closing the week in freefall fashion.

NOTE: Friday is a public holiday in Japan (Vernal Equinox Day)

For a move to the upside we must now see this market hold above 107.75, on its way to retesting 108.31 before a pause. A strong break and close above this level could then see the $/YEN rally into 109.21, and if momentum is very strong we could see moves to 109.94.

If we cannot hold above 107.75, we could see a fast move lower into 107.36. A break below this level may result in a retest of 106.52 before a pause; however any breaks below this level could mean a very sharp move down to 105.50.

COMMODITIES

GOLD – 1528 ( -146 or -8.72% )

 

Gold was sold off very aggressively to the downside last week following unprecedented steps by central banks.

For a continued move higher we must now see this market close above 1526. Should this occur, we will look for a move to 1540 and 1552; and if momentum remains very strong, we cannot rule out moves to 1570 and 1605.

If Gold cannot close above 1526, we will look for a move back down into 1505. A strong break and close below this level could send this market lower into 1480, and if momentum is strong to the downside we cannot rule out a move lower into 1470.

 

 

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