Nikkei 225, FTSE 100 track NASDAQ 100 lower
Nikkei 225, FTSE 100 track NASDAQ 100 lower as US yields rise to multi-month highs and some US corporate earnings disappoint.
Nikkei 225 snaps three-day winning streak as it tracks US peers lower
The Nikkei 225's rally since this weekend’s election result at which Japan's ruling party lost its parliamentary majority has taken it to Wednesday’s 39,719 two-week high before tracking US markets lower.
The 200-day simple moving average (SMA) at 38,594 is being revisited ahead of the 55-day SMA at 38,176. While the next lower August-to-October tentative uptrend line at 37,760 and, more importantly, last week’s low at 37,366 underpin, the medium-term uptrend will stay intact.
A rise above this week’s high at 39,719 would likely engage the late September high at 39,942 and the psychological 40,000 mark.
FTSE 100 falls through key support
The FTSE 100's fall through its key 8,183-to-8,153 support area following Wednesday’s UK budget has also taken it through the June-to-early July lows at 8,112-to-8,106 and the 200-day SMA at 8,101 with the late July low at 8,056 being next in line ahead of the psychological 8,000 mark.
Minor resistance above the previous support zone, now because of inverse polarity a resistance zone, comes in at the September-to-early October lows at 8,153-to-8,196. Further up sits Friday’s 8,222 low, above which lies the 23 October low at 8,240. For the bulls to be back in control a rise and daily chart close above Tuesday’s high at 8,326 would need to be seen. Such a bullish reversal currently looks highly unlikely, though.
NASDAQ 100 form bearish engulfing pattern
The NASDAQ 100's advance from last week’s low at 19,928 has taken it to a 3 ½ month high at 20,652 on Tuesday, close to its July peak at 20,760, before forming a bearish engulfing pattern on the daily candlestick chart on Wednesday amid higher US Treasury yields and mixed corporate earnings.
The bearish chart formation points to at least short-term downside pressure being seen ahead of the US 5 November election with the August-to-October uptrend line at 20,030 and last week’s low at 19,928 representing the nearest downside targets.
A fall through 19,928 could trigger a deeper correction towards the 200-day SMA at 18,877.
Minor resistance can be spotted at the 20,316 September peak, followed by the 22 October high at 20,455.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG 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 this information. Consequently any person acting on it does so entirely at their own risk. Any research provided 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. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Seize your opportunity
Deal on the world’s stock indices today.
- Trade on rising or falling markets
- Get one-point spreads on the FTSE 100
- Unrivalled 24-hour pricing
See opportunity on an index?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Try a risk-free trade
- See whether your hunch pays off
See opportunity on an index?
Don’t miss your chance – upgrade to a live account to take advantage.
- Get spreads from one point on the FTSE 100
- Trade more 24-hour indices than any other provider
- Analyse and deal seamlessly on smart, fast charts
See opportunity on an index?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets
- Equities
- Indices
- Forex
- Commodities
Prices above are subject to our website terms and agreements. Prices are indicative only. All share prices are delayed by at least 15 minutes.
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
