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Market Brief – Monday 8th April 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Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.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 – 6210 (+6 or +0.1%)

The ASX is still stuck within a sideways range as we wait to see whether this market can rally higher.

VOLATILITY ALERTS:

Wed 10:30 – Westpac Consumer Sentiment
Fri 11:30 – RBA Financial Stability Review

For a continued move higher we must now see the ASX hold 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 hold 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 – 12001 (+459 or +3.98%)

The DAX was the strongest performer last week but is now approaching strong technical resistance. We will be discussing the importance of this move in the LIVE CHAT ROOM this week.

VOLATILITY ALERTS:

Wed 21:45 – ECB Interest Rate Announcement – LIVE TV
Wed 22:30 – ECB Press Conference

For a continued move to the upside we must see the DAX close above 12044. Should this occur we will look for a move into 12115 before a pause. This is a very big level and if the DAX can break strongly above this, we will look for a move into 12198 and if momentum is very strong we cannot rule out a blow off move to 12384.

If the DAX fails to close above 12044, we will look for a move back down to 11875. Any break below this level however could see the DAX sell-off sharply into 11755, and if momentum is very strong to the downside we could see a sharp move down to 11519.

 

US

SP500 – 2893 (+58 or +2.05%)

The S&P continues its stellar runs to the upside and we are now only 7 points shy of 2900. We will be discussing what this could mean in the MEMBER PORTAL as it happens.

VOLATILITY ALERTS:

Wed 22:30 – CPI (monthly)
Thu 04:00 – FOMC Meeting Minutes
Thu 22:30 – PPI (monthly)
Sat 00:00 – Prelim UoM Consumer Sentiment

For a move higher we would like to see the S&P hold above 2870. Should this occur we will look for a move into 2902 before a pause. A strong break below this level however sets the stage for a move to 2922 with any further upside potentially meaning a retest of the all time highs at 2941.

If we cannot hold above 2870, we could see this market sell-off into 2838 before another pause. A break of this level however may result in quick move down to 2808; and if momentum to the downside remains strong we may see a move down into 2785.

 

FOREX

AUD/USD – 0.7107 (+11 or +0.16%)

Once again the Aussie Dollar continues to remain in a tight range and so our levels remain unchanged this week.

VOLATILITY ALERTS:

Wed 10:30 – Westpac Consumer Sentiment
Fri 11:30 – RBA Financial Stability Review

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 – 1.1215 (-2 or -0.02%)

With an important week ahead for Europe, we could see volatility return to this market and are on alert for a potentially large move. We will again be covering this in detail MEMBER PORTAL as it happens.

VOLATILITY ALERTS:

Mon 20:00 – CPI Flash Estimate (annual)
Thu 22:30 – ECB Monetary Policy Meeting Minutes

For a move higher we would like to see the EURO close 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 close 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 – 1.3033 (+4 or +0.03%)

With the Brexit extension date looming, this is yet another important week for the Pound which has been showing some very interesting price action over the past week.

VOLATILITY ALERTS:

Wed 18:30 – GDP (monthly), manufacturing Production (monthly)

For a continued move to the upside, we would like to see Cable close above 1.3035 and break through 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 close above 1.3035  we will look for a move back down to 1.2868. A break below this level however could see this market retest the important 1.2720 level; and if momentum to the downside is strong we cannot rule out a bigger move down to 1.2622.

 

USD/JPY – 111.70  (+87 or +0.78%)

The Yen continued to rally last week but like other $US markets, is now at a critical area.

For a move to the upside we must now see this market close strongly above 111.73. Should this occur we could see a strong move into 112.22. A strong break and close above this level could then see the $/YEN rally into 112.68, and if momentum is extremely strong to the upside 113.27 cannot be ruled out.

If we cannot close above 111.73, we will look for another quick retest of 111.09. A break below this level however may result in a fast move down to 110.67, and if the downside remains very strong we cannot rule out a sell-off into 109.94.

 

 

COMMODITIES

GOLD – 1291 (-1 or -0.08%)

Gold appears to be basing and the question this week is can it hold at these levels, or will we see a complete breakdown?

For a continued move higher we must now see this market close and hold above 1294. Should this occur we will look for a retest of 1303. A strong close above this level could see further upside into 1313; and if momentum remains very strong, we could see a big push into 1322 and 1333.

If Gold cannot hold above 1294, we will look for a move back down into 1285. A strong break and close below this level however takes us down into the key 1276 – 1278 area. Should this level break, we could see a strong move down to 1260.

 

 

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