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Market Brief – Monday 4th February 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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 5878 ( -32 or -0.54% )

The ASX is yet again at the key 5920 area and we will again discuss the importance of this level this week.

VOLATILITY ALERTS:
Mon 11:30 – Building Approvals (monthly)
Tue 11:30 – Retail Sales, Trade Balance
Tue 14:30 – RBA Interest Rate Announcement
Wed 12:30 – RBA Governor Lowe Speaks
Fri 11:30 – RBA Monetary Policy Statement
For a continued move higher we must now see the ASX hold above 5823 followed by a close above 5930. A strong close above 5930 could see a move back up into 5985 , and if momentum to the upside is very strong we cannot rule out a strong reversal into 6070.
If the ASX cannot hold above 5823, we will look for a move back down to 5777 and 5746 before a pause. A strong break and close below this level however could see the ASX sell off into 5671, and if downside momentum is very strong we could see a sharp move down to 5582.

EUROPE

DAX – 11189 (-67 or -0.6%)

The DAX took a breather last week and is now primed for a breakout. Will it be up or down? We will be discussing this in the LIVE CHAT ROOM this week.

VOLATILITY ALERTS:

Thu 21:00 – EU Economic Forecasts

For a continued move to the upside we must see the DAX close strongly above 11362. Should this occur we will look for a move into the 11566 before a pause. A break of this level however could result in a very strong move into 11755 – 11790 area; with a possibility of a quick move higher into 11875.

If the DAX fails to close above 11362, we will look for a quick move down to 11050. A break and close below this level could result in a very sharp move down into 10863.

 

US

SP500 – 2705 (+40 or +1.5%)

This week is all about the S&P as we have an extremely busy week of economic data due. We will be discussing these events LIVE this week in the LIVE CHAT ROOM extensively.

VOLATILITY ALERTS:

Wed 02:00 – ISM Non-Manufacturing PMI
Thu 11:00 – Fed Chair Powell Speaks

For a move higher, we would like to see the S&P hold above 2660. Should this occur we will look for a retest of the key 2680 level. A strong break and close above this level could see another retest of 2704, and if momentum remains strong to the upside we cannot rule out moves to 2720 and 2736.

If we cannot hold above 2660, we could see this market continue to sell-off into 2638. A strong break through this level however could quickly see a move down to 2590 before a pause. If momentum to the downside is strong we may see a move lower into 2562; and a close below this level may result in a move down to 2540.

 

FOREX

AUD/USD 

0.7247 ( +68 or +0.95% )

We have a very big week set for the Aussie Dollar which has been recovering since the start of the year. We will be discussing this in the MEMBER PORTAL this week.

VOLATILITY ALERTS:

Mon 11:30 – Building Approvals (monthly)
Tue 11:30 – Retail Sales, Trade Balance
Tue 14:30 – RBA Interest Rate Announcement
Wed 12:30 – RBA Governor Lowe Speaks
Fri 11:30 – RBA Monetary Policy Statement

For a move higher we would like to see the AUD close above 0.7229, followed by a break and close above 0.7282. A strong break and close above this level could see a quick move to 0.7364 before a pause; and if momentum remains strong we will look for a move back up into 0.7447.

If we cannot hold above 0.7229, we will look for a retest of 0.7169; however a failure at this level may result in a move back down into 0.7112 before another potential pause. Any subsequent breaks of this level however may result in a very fast move down to 0.7070.  

 

EUR/USD – 1.1453 (+48 or +0.42%)

The Euro continues to chop inside its sideways range and we are now on alert for a breakout. We will be discussing this market in detail in the LIVE CHAT ROOM this week.

VOLATILITY ALERTS:

Thu 21:00 – EU Economic Forecasts

For a sustained move higher we would like to see the EURO hold above 1.1335 early in the week. Should this occur we could see a strong move into 1.1453 and any breaks above this level may mean a quick move into 1.1496 before a pause. A strong close above this level however could see the EURO rally strong into 1.1613 by the week’s end.

If the EURO cannot hold above 1.1335, we could see a fast move down into 1.1249 before a pause. A strong break of this level may result in a move into 1.1201, however any weakness below this level could see a sharp drop into 1.1117 before the week’s end.

 

GBP/USD – 1.3082 (-116 or -0.88%)

The Pound is in an interesting position with a real battle going on now between bulls and bears.

VOLATILITY ALERTS:

Tue 20:30 – Services PMI
Thu 21:00 – BoE Interest Rate Announcement

For a continued move to the upside, we would like to see Cable hold above 1.3035 and 1.3161 this week. Should this occur we will look for a move to 1.3191 and 1.3277; and if momentum is very strong we could see a re-test of last week’s highs into 1.3386.

On the downside, if we cannot hold above 1.3161 we will look for a move back down to 1.3035. A break below this level however could see this market retest 1.2868; and if momentum to the downside is strong we cannot rule out a bigger move to the key 1.2720 level and 1.2622.

 

USD/JPY – 109.50 (-4 or -0.04%)

The $/YEN finished off the week where it remained and as such our levels remain unchanged.

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 – 1317 (+15 or +1.15%)

Last week we said watch this market and Gold continues to power higher. We’ve now reached a key level at 1322 and this should be watched closely

For a continued move higher we must now see this market hold above 1313. Should this occur we will look for a retest of 1322. A strong close above this level could see further upside into 1333; and if momentum remains very strong, we could see a big push into 1350.

If Gold cannot hold above 1313, we will look for a move back down into 1303. A strong break and close below this level however takes us down into the key 1294 area which is very important and will be watched closely.

 

 

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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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