Another strong week for the Nikkei 225, DAX 40 and Dow
Another strong week for the Nikkei 225, DAX 40 and Dow as investors interpret the Fed’s 50 basis point rate cut as avoiding a recession in the US.
Nikkei 225 ends week on a high
The Nikkei 225 has risen in line with US stock indices after the Federal Reserve (Fed) cut its interest rates for the first time in four years and by a bumper 50 basis points (bps) as the Bank of Japan left rates unchanged as expected.
The 200-day simple moving average (SMA) at 38,527 represents the next upside target, followed by the late July and early September highs at 39,179-to-39,281.
Minor support can be seen along the 55-day SMA at 37,195 and the 12 September high at 37,062.
DAX 40 hits record high
The German DAX 40 index made a new record high at 19,048 on Thursday, a rise above which could lead to the major psychological 20,000 mark being reached.
Potential slips should find initial support around the 18,782 July peak.
The medium-term uptrend is deemed to stay intact while last week’s low at 18,188 underpins.
Dow Jones Industrial Average hits yet another record high
The Dow Jones has seen seven straight days of gains and has been hitting new record highs over the past three days, aided by the Fed’s large 50 bp rate cut after holding rates at a 23-year high of 5.25% to 5.50%.
The 42,500 region represents the next upside target zone with the previous record August high made at 41,587 now acting as potential support. This is due to inverse polarity.
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