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Market Brief – Monday 17th June 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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 6559 (+82 or +1.27%)

The ASX continues to grind its way higher to multi-year highs.

VOLATILITY ALERTS:
Mon 11:30 – Monetary Policy Minutes
Thu 11:15 – RBA Governor Lowe speaks

For a continued move higher we must now see the ASX hold above 6500. Should this occur we will look for a test of 6550. If momentum to the upside is very strong we cannot rule out a move to 6670.

If the ASX cannot hold above 6435, we will look for a move back down to 6435. A strong break and close below this level however could see the ASX retest 6350 before a pause; and if downside momentum is very strong, we could see a move down to 6276.

 

EUROPE

DAX – 12112 (+62 or +0.51%)

The DAX spent most of last week trading back and forth, and this week we are on alert for a breakout.

VOLATILITY ALERTS:
Tue 03:00 – ECB President Draghi Speaks
Tue 18:00 – ECB President Draghi Speaks
Tue 19:00 – German ZEW Economic Sentiment
Thu 00:00 – ECB President Draghi Speaks
Fri 17:30 – German Flash Manufacturing PMI, Flash Services PMI

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 12000. Any break below this level however could see the DAX sell-off sharply into 11875 this week; and if downside momentum is very strong we cannot rule out a move to 11720.

 

 

US

SP500 – 2890 (+14 or +0.49%)

The S&P consolidated its previous rally all week and once again the big question is where to from here? We will be discussing this in more detail in the MEMBER PORTAL.

VOLATILITY ALERTS:
Tue 22:30 – Building Permits
Thu 04:00 – FOMC Interest Rate Announcement
Thu 04:30 – FOMC Press Conference
Thu 22:30 – Philly FED Manufacturing Index

For a move higher we would like to see the S&P close 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 break back down to 2838.  A break of this level however may result in quick move down to 2812; and if momentum to the downside remains strong we may see a very sharp move down into 2800 and 2785.

 

 

FOREX

AUD/USD – 0.6871 (-128 or -1.83%)

The Aussie dollar was sold off aggressively last week following more projections of worsening economic data. We will be covering this market exclusively in the MEMBER PORTAL.

VOLATILITY ALERTS:
Mon 11:30 – Monetary Policy Minutes
Thu 11:15 – RBA Governor Lowe speaks

For a move higher, we would first like to see the AUD close above 0.6875. Should this occur we will look for a move into 0.6934, and if upside momentum remains very strong we cannot rule out a move to 0.6958 and 0.7104 before a pause.

If the AUD cannot close above 0.6875, we will look for a move lower into 0.6830. A break and close below this level however could see a sharp decline into 0.6761; and if momentum to the downside remains strong we cannot rule out a move into 0.6706.

 

 

EUR/USD – 1.1211 (-121 or -1.07%)

Friday saw a strong sell-off in many currencies and the Euro was on of the hardest hit as we now find this market back inside its previous sideways range.

VOLATILITY ALERTS:
Tue 03:00 – ECB President Draghi Speaks
Tue 18:00 – ECB President Draghi Speaks
Thu 00:00 – ECB President Draghi Speaks
Fri 18:00 – Euro Area Flash Manufacturing PMI, Flash Services PMI

For a move higher we would like to see the EURO close above 1.1249 early in the week. Should this occur we could see a retest into 1.1335 and any breaks above this level may mean a quick move into 1.1453 before a pause. A strong close above this level however could see the EURO rally strong into 1.1496 by the week’s end.

If the EURO cannot close above 1.1249, we could see a move down into 1.1201 before a pause. A strong break of this level may result in a move into, however any weakness below this level could see a sharp drop into 1.1117 before the week’s end.

 

 

GBP/USD – 1.2590 (-147 or -1.15%)

The Pound is now close to testing last month’s lows. Can we break lower this week? We will be discussing this in the LIVE CHAT ROOM this week.

VOLATILITY ALERTS:
Wed 00:00 – BoE Governor Carney Speaks
Wed 18:30 – CPI (annual)
Thu 18:30 – Retail Sales (monthly)
Thu 21:00 – BoE Interest Rate Announcement – LIVE TV
Fri 06:00 – BoE Governor Carney Speaks

For a continued move to the upside, we would like to see Cable close above 1.2622. Should this occur we will love for a move into 1.2720. A strong break above this level could then see a strong move to 1.2868 before a pause; and if momentum is very strong we cannot rule out a move to 1.3035.

On the downside, should we fail to close above 1.2622, we look for a bigger move down into 1.2480. A close below this level however sets the Pound on course for a bigger move down to 1.2375 and 1.2297.

 

 

USD/JPY – 108.54 (+35 or +0.32%)

The YEN has again finished off the week in a small sideways range and like equity markets, we are on alert for a move this week.

VOLATILITY ALERTS:
Thu 12:30 – BoJ Interest Rate Announcement

For a move to the upside we must now see this market hold above 108.31, on its way to retesting 109.21 before a pause. A strong break and close above this level could then see the $/YEN rally into 109.94, and if momentum is very strong we could see moves to 110.31 and 110.78.

If we cannot hold above 108.31, we could see a fast move lower into 107.75. A break below this level may result in a retest of 107.36 and this is where things get very interesting. A break below this level could mean a very sharp move down to 106.52.

 

 

 

COMMODITIES

GOLD – 1341 (+1 or +0.07%)

Following a big reversal on Friday, GOLD has finished off the week practically unchanged after testing some big levels. Is this a sign of a reversal?

For a continued move higher we must now see this market hold above 1333. Should this occur we will look for a retest of the important 1355; and if momentum remains very strong, we could see a big push into 1365 and 1374.

If Gold cannot hold above 1333, we will look for a move back down into 1322. A strong break and close below this level however could send this market lower into 1313, and if momentum is strong to the downside we cannot rule out moves lower into 1303 and 1294.

 

 

 

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