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Market Brief – Monday 22nd July 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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 6681 (+9 or +0.13%)

The ASX continues to consolidate again at our key level at 6682. We will be discussing this in the MEMBER PORTAL.

VOLATILITY ALERTS:

Thu 13:05 – RBA Governor Lowe Speaks

For a continued move higher we must now see the ASX close above 6720. Should this occur we will look for a test of 6804. A strong break of this level however could see the ASX rally quickly to 6850, and if momentum is very strong we cannot rule out a move to 7011.

If the ASX cannot close above 6720, we will look for a move back down to 6650. A strong break and close below this level however could see the ASX move lower into 6544 before a pause; and if downside momentum is very strong, we could see a move down to 6435.

 

EUROPE

DAX – 12239 (-87 or -0.71%)

The DAX sold off for the second straight week; and now we look to see if this market can find support at previously important levels.

VOLATILITY ALERTS:

Wed 17:30 – German Flash Manufacturing PMI, German Flash Services PMI
Thu 18:00 – German Ifo Business Climate
Thu 21:45 – ECB Interest Rate Announcement – LIVE TV
Thu 22:30 – ECB Press Conference

For a continued move to the upside we must see the DAX close above 12384. Should this occur we will look for a move off 12566 into 12714. If momentum is very strong, we could see a fast move  to 12921.

If the DAX fails to close above 12384, we will look for a move back down to 12198. Any break below this level however could see the DAX sell-off sharply into 12000 this week.

 

US

SP500 – 2968 (-42 or -1.4%)

With a big week in store for US markets this week, the S&P is now at a turning point. Can the market hold here or will we see sellers become more aggressive? We will be discussing this market in the LIVE CHAT ROOM this week.

VOLATILITY ALERTS:

Wed 23:45 – Flash Manufacturing PMI
Thu 22:30 – Core Durable Goods Orders (monthly)
Fri 22:30 – Advance GDP (quarterly)

For a move higher we would like to see the S&P close back above 2985. Should this occur we will look for a move to 3003. A strong break above this level however sets the stage for a move higher into 3066.

If we cannot close above 2985, we could see this market retest 2960. A break of this level however may result in quick move down to 2941; and if momentum to the downside remains strong we may see a fast move down to 2904.

 

 

FOREX

AUD/USD – 0.7044 (+23 or +0.33%)

The Aussie Dollar has finally managed to clear the important 70c level; but can it hold above it this week?

VOLATILITY ALERTS:

Tue 11:30 – Monetary Policy Meeting Minutes
Thu 11:30 – Unemployment Rate

For a move higher, we would first like to see the AUD hold 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 hold 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 – 1.1221 (-49 or -0.43%)

The Euro is testing the patience of every participant both bull and bear. As we trade back down into support, can the buyers rally together this week?

VOLATILITY ALERTS:

Wed 18:00 – Flash Manufacturing PMI, Flash Services PMI
Thu 21:45 – ECB Interest Rate Announcement – LIVE TV
Thu 22:30 – ECB Press Conference

For a move higher we would like to see the EURO hold above 1.1249. 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 hold 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 – 1.2505 (-71 or -0.56%)

Perhaps the biggest week of Q2- this week we learn who is the new UK PM. We will be covering this event and what it means for the Pound exclusively in the MEMBER PORTAL.

For a continued move to the upside, we would like to see Cable close above 1.2622, followed by a retest of 1.2720 before a pause. Should this occur we will look for a move to 1.2868; and if momentum is very strong, we could see a stronger move into 1.3035.

On the downside, a close below 1.2480 could see this market sell off strongly into 1.2350. Any further weakness below this level could see the Pound continue to slide down into 1.2297; and if momentum to the downside is very strong this week we cannot rule out a move to 1.2195.

 

 

USD/JPY – 107.71 (-18 or -0.17%)

The $/YEN remains in a choppy sideways range and as such our levels remain unchanged this week.

VOLATILITY ALERTS:

Tue 01:00 – BoJ Governor Kuroda Speaks

For a move to the upside we must now see this market close 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 close 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 – 1425 (+10 or +0.71%)

Gold managed to break to new multi-year highs once again however did manage to trade back inside the range on Friday.

For a continued move higher we must now see this market hold above 1416. Should this occur we will look for a retest of 1433; and if momentum remains very strong, a strong break above this level could see Gold rally quickly into 1450.

If Gold cannot hold above 1416, we will look for a move back down into 1402. A strong break and close below this level however could send this market lower into 1393, and if momentum is strong to the downside we cannot rule out a move lower into 1374.

 

 

 

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