17.02.27 - WMB_w

Market Brief – Monday 27th February 2017

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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 5731 ( -79 or -1.36% )

The ASX has posted a Double Top as we discussed in our LIVE CHAT ROOM. This week we are cautious of a bounce as this market approaches key support levels.

VOLATILITY ALERT: Current Account on Tuesday, Quarterly GDP on Wednesday, Building Approvals and Trade Balance on Thursday.

For a continued move higher we would like to see the ASX hold above 5705. Should this occur we will look for a move back up into 5746, and break of this level could see a quick retest of 5777. A strong break and close of 5777 may result in a retest of 5823, and if momentum is very strong this week we will could see a strong rally into 5875.

If the ASX cannot hold above 5705, we are likely to see a quick move down to 5690. A strong break and close below this level could see the ASX test 5606 and if momentum is strong we could easily see further losses down to 5589 this week.

 

EUROPE

DAX – 11834 ( +51 or +0.43% )

The DAX has all but turned at our key level and the breakout we saw on Tuesday was quickly faded come Friday (but again found support at our levels). We will be discussing this market in the MEMBER PORTAL this week.

VOLATILITY ALERT: German Prelim CPI and Unemployment on Wednesday, Retail Sales on Friday.

For a continued move to the upside we must see the DAX hold above the 11755 – 11790 area. Should this occur, we will look for a retest 11875. If momentum is strong, a break and close above this level could see another push higher into 12054, and above this we have a key level at 12198.

If the DAX fails to hold above 11790, we will look for a move back down to 11592; and if there is a complete reversal of the breakout, a strong move down to 11340 cannot be ruled out.

 

US

SP500 – 2366 ( +17 or +0.72% )

The US continues to power away and push higher. This week we have some important data and quite a few Fed speakers, as the market continues to look for clues as to what the FED will do come March.

VOLATILITY ALERT: Core Durable Goods and Pending Home Sales on Monday, Quarterly Prelim GDP, Chicago PMI and Consumer Confidence on Tuesday, Manufacturing PMI on Wednesday, Non-Manufacturing PMI and Yellen speaks on Friday.

Our comments from last week remain unchanged:
For a move higher we would like to see a the S&P hold above our key 2334 level. Should this occur we continue to look for a move higher into 2386.

If we cannot hold above 2334, we will look for a move back down to 2312. A strong break and close below may result in a move down to 2292. Should momentum to the downside remain strong, a sharp move into 2270 cannot be ruled out.

 

FOREX

AUD/USD – 0.7667 ( -1 or -0.01% )

For the third straight week the AUD has fluctuated back and forth around our 0.7667 level, after again clipping our high at 0.7229 but failing to close higher.

VOLATILITY ALERT: Current Account on Tuesday, Quarterly GDP on Wednesday, Building Approvals and Trade Balance on Thursday.

For a move higher we would like to see this market hold above 0.7677. Should this occur we will look for another retest of 0.7729. However- should we break this level now we are likely to see very fast moves into 0.7765 and 0.7833.

On the downside, a failure to hold above 0.7677 could see a move back down to 0.7617. A strong break and close of this level may result in another leg down to 0.7561, and if momentum is very strong we cannot rule out a sell-off into 0.7489 and 0.7447.

 

EUR/USD – 1.0557 ( -52 or -0.49% )

The EURO was weaker for the third straight week as uncertainty continues to grip this market.

VOLATILITY ALERT: German Prelim CPI and Unemployment on Wednesday, Annual CPI Flash Estimates on Thursday, German Retail Sales on Friday.

For a sustained move higher we would like to see this market break and close above 1.0631. If we can hold above this level we will look for a move back into 1.0738, and should momentum remain strong we will be watching the key area between 1.0977 – 1.1000.

If we cannot close above 1.0631, we are likely to see a retest of 1.0525. A strong break below that could see 1.0462 very quickly, and if momentum is strong we cannot rule out a move to 1.0424.

 

GBP/USD – 1.2456 ( +47 or +0.38% )

Our comments from last week on Cable have also not changed: “Cable remains in a sideways range and is ready for a breakout”. 

VOLATILITY ALERT: Manufacturing PMI on Wednesday, Construction PMI on Thursday, Services PMI on Friday.

For a move to the upside we would like to this market break above 1.2480. A strong break and close above this level should see a retest of 1.2622, and if momentum remains strong a move to 1.2720 is still very possible.

On the downside we now have a very important level at 1.2384. A break below this level may see this market head lower to 1.2297, further breaks to the downside may result in a move to 1.2100. As previous- the downside may be swift and sharp.

 

USD/JPY – 112.18 ( -71 or -0.63% )

The $/YEN is becoming VERY interesting. This market is now approaching a key Double Bottom area and if we break lower, things could move fast quickly. We will be discussing this market in more detail in the MEMBER PORTAL.

VOLATILITY ALERT: Annual Household Spending and Consumer Confidence on Friday.

For a continued move to the upside we must first see this market hold above 111.72. Should this occur we will look for a retest of 113.87 – 114.08. A close above 114.08 could see this market retest 114.52; and if we see a reversal to the upside this week, we cannot rule out a move to 115.54.

If we cannot hold above 111.72 WATCH OUT. A sharp move down into 111.09 is possible; and if momentum is strong a sharp sell-off to 109.94 is cannot be ruled out.

 

COMMODITIES

GOLD – 1256 ( +22 or +1.78% )

Last week we mentioned the ‘yellow metal was awakening’ with an upper level at 1257. We closed at 1256 for the week! This week we have a VERY BIG area between 1276 – 1278 and will look to see if GOLD can reach these levels this week. We will be discussing this market in the LIVE CHAT ROOM.

For a continued move higher we want to see this market now hold above 1247. Should this occur we will look for support at 1257 and a continued rally into 1276-1278.

If Gold cannot hold above 1247, we may see a retest of 1222-1218. A strong break and close below these levels may result in a move back down to 1206.

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The views represented on this website do not contain (and should not be construed as containing) financial advice, recommendations, opinions in relation to acquiring, holding or disposing of a financial product of any kind, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Trade View Investments accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of the above information. Consequently any person acting on it does so entirely at his or her own risk. The research does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication.

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