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Market Brief – Monday 25th March 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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 6142 (-62 or -1%)

The ASX remained in a holding pattern for the entire week and this week we are on alert for a reversal.

For a continued move higher we must now see the ASX close above 6180 on its way to retest 6206. Should this occur we will look for a move into 6276, and if momentum to the upside is very strong we cannot rule out a move to 6345.

If the ASX cannot close above 6180, we will look for a move back down to 6140 for strong support. A strong break and close below this level however could see the ASX retest 6070, and if downside momentum is very strong we could see a move down to 5985.

EUROPE

DAX – 11332 (-354 or -3.03%)

The DAX one again proved it has struggled to hold highs but we are now at an important technical level. We will be discussing the importance of this move in the LIVE CHAT ROOM this week.

VOLATILITY ALERTS:

Mon 20:00 – German IFO Business Climate
Wed 19:00 – ECB President Draghi speaks
Thu All Day – German Prelim CPI (monthly)

For a continued move to the upside we must see the DAX close strongly above the 11050. Should this occur and if the DAX can hold above this level, we will look for a retest of the important 11366 level.

If the DAX fails to close above 11050, we will look for a move back down to 10863 before a pause. Any break below this level however could see the DAX sell-off sharply into 10601, and if momentum is very strong to the downside we cannot rule a move into 10382.

 

US

SP500 – 2802 (-22 or -0.78%)

Following a big move higher by the FED on Thursday, the S&P completely retraced this move with a strong day down on Friday. We will be discussing the importance of this move in the MEMBER PORTAL as it happens.

VOLATILITY ALERTS:

Thu 23:30 – Building Permits
Wed 01:00 – CB Consumer Confidence
Thu 23:30 – Final GDP (quarterly)
Fri 23:30 – Core PCE Price Index (monthly), Personal Spending (monthly)
Sat 00:45 – Chicago PMI
Sat 01:00 – Revised UoM Consumer Sentiment

For a move higher we would like to see the S&P hold above 2760. Should this occur we will look for a move into 2808 before a pause. A strong break below this level however see a bigger move into 2838, and if momentum is very strong we cannot rule out a move into 2870.

If we cannot hold above 2760, we could see this market continue to sell-off into 2736 before another pause. A break of this level however may result in quick move down to 2704; and if momentum to the downside remains strong we may see a move down into 2680 and 2660.

 

FOREX

AUD/USD – 0.7080 (-5 or -0.07%)

The Aussie Dollar closed down slightly lower however our levels for this week remain unchanged.

For a move higher, we would first like to see the AUD close above 0.7113. Should this occur we will look for a move into 0.7197, and if upside momentum remains strong we will look for 0.7229 – 0.7236 before a pause.

If the AUD cannot close above 0.7113, we will look for a move lower into 0.7014. A break and close below this level however could see a sharp decline into 0.6997. Any further breaks to the downside could then see the AUD quickly trade at 0.6958 and 0.6934; and if momentum to the downside remains strong we cannot rule out a move into 0.6830.

 

EUR/USD – 1.1300 (-25 or -0.22%)

The Euro also saw a strong sell-off on Friday to close the week down. Can this market find buyers here to reverse higher or is this the start of a bigger move to the downside?

VOLATILITY ALERTS:

Wed 19:00 – ECB President Draghi Speaks

For a move higher we would like to see the EURO hold 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 hold above 1.1249, we could see a fast 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 – 1.3211 (-84 or -0.63%)

This week is the final week the UK have to trigger Article 50 with the EU; for Brexit. We will again be covering this in more detail in the MEMBER PORTAL.

VOLATILITY ALERTS:

Fri 20:30 – Current Account, Final GDP (quarterly)
Sat TBC  – Parliament Brexit Vote

For a continued move to the upside, we would like to see Cable close above 1.3277 this week. Should this occur we will look for a move to 1.3386 and if momentum is very strong we could see a bigger move into 1.3534

On the downside, if we cannot close above 1.3277 we will look for a move back down to 1.3161. A break below this level however could see this market retest the important  1.2868; and if momentum to the downside is very strong we cannot rule out a bigger move to 1.2720.

 

USD/JPY – 109.94  (-157 or -1.41%)

The YEN has broken out of its tight sideways wedge and is at a very important level here at 109.94. We have spoken about this level many times in the past and it is one to watch.

For a move to the upside we must now see this market close strongly through 109.94. Should this occur we could see a strong move into 111.09. A strong break and close above this level could then see the $/YEN rally into 111.73, and if momentum is extremely strong to the upside 112.68 cannot be ruled out.

If we cannot close above 109.94, we will look for another quick retest of 109.21. A break below this level however may result in a fast move down to 108.31, and if the downside remains very strong we cannot rule out a sell-off into 107.75.

 

 

COMMODITIES

GOLD – 1313 (+11 or +0.84%)

Gold has found buyers but the market is still range bound. Are we seeing the early stages of more buyers?

For a continued move higher we must now see this market close above 1321. Should this occur we will look for a move into 1333, and if momentum remains very strong, we could see a big push into 1350.

If Gold cannot close above 1321, we will look for a move back down into 1313 and potentially 1303. A break below this level however sets the stage for a bigger move into 1294 if momentum to the downside is strong.

 

 

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