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Market Brief – Monday 22nd Feb 2016

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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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

INTERMEDIATE WORKSHOP 

MARCH 2016 – FULL

APRIL 2016 – 4 SEATS LEFT

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INDICES

AUSTRALASIA

ASX – 4957 ( +118 or +2.44% )

Last week we saw worse than expected Employment numbers and guess what? The ASX rallied, right into our 4997 – 5021 levels before falling off late in the week.

For a continued moved higher we would now like to see 4921 hold as support followed by a retest of 4997. A strong break and close above 4997 could see a move to 5021, and a strong break and close above this could see the ASX rally to to 5090 before another pause. Should momentum remain strong to the upside, we could see a move back up to 5161.

Should we fail to close above 4997,  we will be watching for a move back down to 4890. A break below this may result in a move to 4859 and 4844 before a pause. Should momentum remain strong to the downside, we may see moves back down into 4782 and 4766. Subsequent breaks below these levels could result in sharp moves back down to 4712 and 4618. 

 

EUROPE

DAX – 9375 ( +386 or +4.29% )

The DAX also rallied as we previously alerted too before closing for the week near our 9386 level. We spoke about this real-time in our LIVE CHAT ROOM.

For a continued move to the upside we would like to see 9254 hold as support followed by a close above 9386. A close above this level will likely see a retest of 9447, and a strong break above 9447 could see the DAX test 9620. If momentum remains strong a break and close above 9620 may result in a move back up to 9822.

On the downside we are watching for a break below 9322, which may then result in a retest of 9254. A break and close below 9254 could see a move down to 9135 followed by 9092. If momentum remains strong we could see a quick move down to 9016, and should the selling really gain strength we will be watching for sharp moves down to 8890 and 8681.

 

US

SP500 – 1917 ( +54 or +2.9% )

The S&P has now put in a significant double bottom. With a production freeze in Oil, will these low’s hold going forward? We will be talking about this in more detail in our MEMBER PORTAL.

For a sustained move higher we would first like to see 1902 hold as support followed by a strong break of 1934. A strong break above 1934 may see the S&P test 1958 before another pause. A break above 1958 could result in a move to 1968, and should momentum remain strong we will watch for a move to 1990.

If we cannot break above 1934 we will watch for a retest of 1902. A break below 1902 may allow for a move back into 1875, and a strong break and close below 1875 may likely result in a quick move to 1865 before a pause. If the move to the downside continues sharp moves into 1834 and 1821-1817 are likely; and any subsequent breaks below this could see a retest of 1809.

 

FOREX

AUD/USD – 0.7148 ( +43 or +0.61% )

Despite closing slightly higher, the AUD was for the most part sideways all week.

VOLATILITY ALERT: Quarterly CapEx on Thursday.

For a move higher we would now see the AUD hold 0.7113, followed by a break and close above 0.7197. A break above this level may result in a move to 0.7229 – 0.7236 before a pause. Should we see a strong break and close above this area, the AUD could really rocket and we will then be watching for moves into 0.7305 and 0.7365.

If the AUD cannot hold 0.7113, we will be watching for a move back down to 0.7068. A break and close below below this could see quick moves into 0.7014 and 0.6997, and subsequent .

 

EUR/USD – 1.1129 ( –126 or -1.12% )

A quiet week on the Euro saw some very small ranges last week. We will be watching for volatility to potentially pick up this week.

For a sustained move higher we would like to see strong breaks above 1.1163 and 1.1201. A break above 1.1201 may result in a retest of 1.1248, and if momentum remains strong we could see fast moves into 1.1347 and 1.1385 before a pause.

If the EURO cannot hold 1.1064 we will watch for a move back down to 1.1033 – 1.1026 before a pause. A strong break and close below this level may see the EURO move back down to 1.0977. If momentum remains very strong we could see a sharp move down to 1.0897.

 

GBP/USD – 1.4402 ( -102 or -0.7% )

In contrast to the EURO, the GBP was much more volatile as we inch closer to some major fundamental events currently playing out in the UK. These will be discussed in more detail in our MEMBER PORTAL.

For a move to the upside we would like to see 1.4259 hold as support, followed by a break of 1.4469. A break and close above this level could see the GBP retest 1.4635 before a pause. If the move to the upside is very strong, we will be watching for fast moves into 1.4790 and finally 1.4824.

On the downside, a strong break and close below 1.4382 could see a move down into 1.4259. A break and close below this level may result in quick moves to 1.4223 and 1.4194 before a pause. Should momentum to the downside remain strong, we will be watching for a sharp move down to 1.4039.

 

USD/JPY – 112.57 ( -64 or -0.57% )

The negative interest rate move announced by the BoJ has now been faded for the 3rd consecutive week. If the USD/JPY continues to fall we wonder- will the BoJ intervene again???

For a sustained move to the upside we like to see a strong break and close above 113.39. A break above may allow the USD/JPY to rally into 113.88, 114.08 – 114.14 before a pause. A break above 114.14 could result in a retest of 114.55, and if momentum remains strong we could see moves all the way higher into 115.53 and finally 116.08.

If the USD/JPY cannot close above 113.39, we will be watching for a move back down into 111.73. A break below this level may then result in a retest of 111.09. Should we see a strong break below 111.09 we could see a fast and sharp move all the way down to 109.94

 

COMMODITIES

GOLD – 1226 ( -11 or -0.89% )

The GOLD bugs are officially back in town. A blowoff move on Thursday saw GOLD break all kinds of levels and rocket to the upside. We have now seen GOLD rally into an important level and will again be watching this market closely in the MEMBER PORTAL.

For a continued move to the upside we would first like to see 1222 hold, followed by a strong break and close above 1247. A break above 1247 may result in a retest of 1258, and if momentum remains very strong we could see a final push into 1276 before a pause.

For a sustained move to the downside we would like to see GOLD break and close below 1222. A strong break below this level could result in a move back down to 1206; and should we see a complete fade of last week’s move we may see GOLD trade back down to 1187 and 1181.

 

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