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Market Brief – Monday 7th November 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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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INDICES

AUSTRALASIA

ASX – 5154 ( -125 or -2.37% )

The ASX is now at very important levels and this week we will look for early signs of a potential reversal to the upside, beginning today.

For a continued move to the upside we must now see a break back above 5161. If we can hold above this level we could see this market move to 5238. A strong break and close above this level may result in a move to 5294; and if momentum remains strong we could see a move into 5373 and back up to 5437

If we fail to close above 5161, we will look for a move back down to 5090. A break below this could result in a move back into 5052, and further breaks to the downside could see the ASX head to 4997. If momentum to the downside is strong, a move down to 4890 cannot be ruled out.

 

EUROPE

DAX – 10215 ( -440 or -4.13% )

The DAX sold off very aggressively last week, down over 4%! Like the ASX, is now at very key level. We will be watching this market very closely this weekend.

VOLATILITY ALERT: Eurogroup meetings all day on Monday, ECOFIN Meetings on Tuesday.

NOTE: Friday is a public holiday in France.

For a continued move to the upside we would like to see the DAX hold above 10158. Should this occur we may see a strong move back up into 10289 and 10382. A strong break above this level could then see a very quick fade back into 10585 – 10601 before another pause. If momentum is VERY strong we would not rule out an explosive move to 10863.

If we fail to break above 10289, we may see a move down into 10158 quickly. A close below this level may result in a move down 10013 and should this level fail, we could see a move back down into to 9907. A strong break below this level could see the DAX trade all the way back down to 9822.

 

US

SP500 – 2084 ( -45 or -2.11% )

The S&P500 appears to be showing signs of a very large upcoming move. Last week we detailed why we believe this market may be reversing in our MEMBER PORTAL so watch for signs of this early this week.

However the big news will be the election this week on Tuesday. We have rolling coverage of this in the Member Portal. In the meantime here is a quick read: Hillary vs Trump

NOTE: Friday is a public holiday (Veteran’s Day)

VOLATILITY ALERT: Presidential election on Tuesday.

For a move higher we would like to see a the S&P hold above 2076. Should this occur we will look for a move to 2097. A strong break and close above 2097 may result in a move to 2106 and 2112 before another pause. If momentum remains strong, a break above 2112 could see the S&P quickly test 2126 and then 2137.

If we cannot hold above 2076, we will watch for a move back down into 2054. A strong break and close below this level may likely see the S&P head back down into the important 2040 area; and if momentum to the downside remains strong we could see a very fast move down into 2019.

 

FOREX

AUD/USD – 0.7672 ( +74 or +0.97% )

The AUD has managed to climb higher on concerns surrounding the $US. Will we see a backflip this week or will the AUD continue its run to 78c+?

For a move higher we would like to see the AUD remain above the 0.7662. A strong break and close above these levels could then see a quick move to 0.7729 before a pause; and if momentum remains strong we will look for strong move into 0.7789 and 0.7833.

If we cannot remain above 0.7662, we will look for a move back down to 0.7617. A strong break below this level may result in a move back down into  0.7561, and further breaks lower could see . 0.7447 before another potential pause. If momentum remains strong, watch for a move down to 0.7364.

 

EUR/USD – 1.1138 ( +152 or +1.38% )

Last Tuesday we saw the EURO close strongly through the 1.1000 level and it did not look back. We are now back to some very important levels and will keep a close eye on this market.

We will discuss this market in more detail throughout the week in our MEMBER PORTAL.

NOTE: Friday is a public holiday in France (Armistice Day)

VOLATILITY ALERT: Eurogroup meetings all day on Monday, ECOFIN Meetings on Tuesday.

For a sustained move higher we would still like to see the EURO hold above 1.1117. Should this occur we will then look for a strong move into 1.1248. If we continue to break higher, a quick move into 1.1347 is possible and if momentum remains strong we cannot rule out a move back up to 1.1380 this week.

If the EURO cannot remain above 1.1117, we will watch for a move back down to to 1.1083. Should we see further breaks to the downside, a move to 1.1083 cannot be ruled out; and if momentum remains very strong we could see a sharp move down to 1.1033.

 

GBP/USD – 1.2518 ( +327 or +2.68% )

The GBP/USD has moved through the key 1.2500 level we discussed last week.

VOLATILITY ALERT: Manufacturing Production on Tuesday, Trade Balance on Wednesday.

For a continued move to the upside, we would like to see Cable remain above 1.2458. Should this occur we will look for a move back up to 1.2720. A strong break through this level could see the GBP/USD trade to 1.2853, and should momentum remain very strong we cannot rule out a move to 1.3035.

On the downside, should break and close strongly below 1.2458, we could see a potential move down to 1.2297. A strong break and close below this level may see the Pound trade back down to 1.2159.

 

USD/JPY – 103.08 ( -162 or -1.55% )

The USD/JPY was unable to remain above the key 104 area last week and we will watch this level again this week as a very key area.

VOLATILITY ALERT: Current Account on Wednesday.

For a continued move to the upside we would like to see this market break above 103.21. Should this occur we will look for move to retest 103.99. A strong break above 103.99 could then see a move to 104.97, and if momentum remains strong we cannot rule out a sharp move higher to 106.30.

If however the USD/JPY cannot break strongly above 103.21, we will look for a move back down to 102.29. A strong break below this level may see the $/JPY fade all the way back down to 100.61 before a pause. A strong break below these levels could see the USD/JPY trade quickly down to 99.90.

 

COMMODITIES

GOLD – 1304 ( +28 or +2.19% )

Gold continued its climb higher as the uncertainty around the election continues.

We will discuss this market in more detail throughout the week in our MEMBER PORTAL.

For a continued move higher we would like to see this market remain above 1303, followed by a retest of 1315. Should this occur we could see a move into 1322, followed by a retest of 1333. If upside momentum is very strong we will look for a move to 1350.

If Gold cannot hold above 1303, we will look for a move back down to 1294. A strong break and close below this level may see Gold move 1276, and if the downside is very strong moves into 1257 and 1247 cannot be ruled out before the end of the week.

 

 

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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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