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Market Brief – Monday 20th April 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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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INDICES

 

AUSTRALASIA

 

ASX – 5489 ( +25 or +0.46% )

 

The ASX has managed to just hold onto its weekly gains; and this week we look to see if this market can continue its recovery. 

 

VOLATILITY ALERTS:

Tue 11:30 – Monetary Policy Meeting Minutes

Tue 15:00 – RBA Governor Lowe Speaks

 

For a continued move higher we must now see the ASX close above 5746 followed by a push into 5823. Should this occur we will look for a move into 5985, and if momentum to the upside remains strong we cannot rule out a move to 6070.

If the ASX cannot close above 5746, we will look for a move back down to 5408. A strong break and close below this level could see the ASX retest lower into 5102, and if downside momentum is very strong we cannot rule out a move to 4695.

 

EUROPE

 

DAX – 10701 ( +15 or +0.14% )

 

The DAX finished off the week where it started and we are watching this market closely now for a potential breakout. We will be discussing this in the MEMBER PORTAL this week.

 

VOLATILITY ALERTS:

Tue 19:00 – German ZEW Economic Sentiment

Thu 17:30 – German Flash Manufacturing PMI, Services PMI

Fri 18:00 – German Ifo Business Climate

 

For a move to the upside we must see the DAX close above 11050. Should this occur we will look for a retest of 11366. If the DAX can break strongly through this level, we will look for a move into 11566.

If the DAX fails to close above 11050, we will look for a move back down to 10266 before a pause. Any break below this level however could see the DAX sell-off sharply into 10010, and if momentum is very strong to the downside we cannot rule out a move back down to 9690.

 

US

 

SP500 – 2878 ( +84 or +3.01% )

 

The S&P was also again stronger than others as it too inches further to recovery. We will be discussing this in the MEMBER PORTAL this week.

 

VOLATILITY ALERTS:

Thu 23:30 – Unemployment Claims

Thu 23:45 – Flash Manufacturing PMI

Fri 22:30 – Durable Goods Orders (monthly)

 

For a move higher, we would like to see the S&P hold above 2870, followed by a retest of the key 2902 level. Should this occur and we see strong momentum, a break above this level could see the market rally strongly into 2998.

If we cannot hold above 2870, we could see this market sell-off into 2780. If momentum to the downside is strong we may see a move lower into 2678; and a close below this level may result in a very fast move down to 2632 and 2478.

 

FOREX

 

AUD/USD – 0.6306 ( -39 or -0.61% )

 

The Aussie Dollar was flat for the week as we head into another important week for this market. We will be discussing this in the LIVE CHAT ROOM.  

 

VOLATILITY ALERTS:

Tue 11:30 – Monetary Policy Meeting Minutes

Tue 15:00 – RBA Governor Lowe Speaks

 

For a move higher, we would first like to see the AUD hold above 0.6282. 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 0.6282, we could see this market break lower and retest 0.6092. If momentum to the downside is very strong, a move back down to 0.5980 cannot be ruled out.

 

EUR/USD – 1.0871 ( -59 or -0.54% )

 

The EURO bears returned in the second half of last week to close the market lower after being up early in the week.

 

VOLATILITY ALERTS:

Thu 18:00 – Flash Manufacturing PMI, Services PMI

 

For a move higher, we would like to see the EURO hold above 1.0814 on its way to retesting 1.1033. Should this occur, we will look for a move to 1.1117; and if momentum is very strong we cannot rule out a move to 1.1201.

 

If the EURO cannot hold above 1.0814, we could see a move back down into 1.0652. If this market continues to sell-off a move lower into 1.0525 is very possible; and if momentum is very strong to the downside we could see a fast and sharp move down into 1.0480.

 

GBP/USD – 1.2493 ( +45 or +0.36% )

 

Cable was very quiet and like the DAX, we are watching this market closely for a breakout. We will be discussing this market again in the LIVE CHAT ROOM this week.

 

VOLATILITY ALERTS:

Wed 16:00 – Annual CPI

Thu 18:30 – Flash Manufacturing PMI

Fri 16:00 – Retail Sales (monthly)

 

For a continued move to the upside, we need to see the Pound hold above 1.2480. Should this occur we may see a move into 1.2720, and if momentum is very strong we cannot rule out further upside into 1.2868.

If the Pound cannot hold above 1.2480, we could see a move lower back down to 1.2297. A break of this level however sets up for a move down to 1.2080; and if momentum to the downside is very strong 1.1896 cannot be ruled out.

 

USD/JPY – 107.52 ( -83 or -0.77% )

 

They $/YEN showed signs of weakness last week as .

 

For a move to the upside we must now see this market close above 108.31. Should this occur we will look for a retest of 109.21, and if momentum is very strong we could see a move higher into 109.94 and potentially 111.73.

 

If we cannot close above 108.31, we could see a move lower into 106.52 before a pause to the downside. A break below this level may result in a sharp move lower into 105.50; and any further breaks to the downside may see a bigger move into 104.97.

 

COMMODITIES

 

GOLD – 1681 ( -2 or -0.12% )

 

After breaking out to new highs, Gold posted another strong week before reversing late in the week to finish flat.

 

For a continued move higher we must now see this market hold above 1674. Should this occur we could see a strong move to 1687; and any break of this level could see a stronger move to 1724 and 1755.

 

If Gold cannot hold above 1674, we will look for a move back down to 1648. A break below this level could see a move lower into 1605; and if momentum is very strong to the downside we could see a move to 1574.

If Gold cannot hold above 1575, we will look for a move back down into 1548. A strong break and close below this level could send this market lower into 1515.

 

 

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