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Nikkei 225 Hits One-Year High as Risk Appetite Returns

Nikkei 225 m
Nikkei 225

Asian indices and Nikkei gained further ground today as risk appetite returns on US-China trade deal hopes, better Q3 earnings results and weaker Yen. The Hang Seng index trades 0.61% higher at 26,729, the Shanghai Composite is 0.07% lower at 2,939, while the Singapore Straits Times is 0.84% higher at 3,170. Aussie stocks finished flat; the ASX 200 ended almost unchanged at 6,652.

Nikkei 225 finished 0.55% higher at 22,750 making fresh yearly high getting a boost from August final leading index indicator which came in 91.9 vs the preliminary reading of 91.7 and Japan preliminary PMIs for October Manufacturing which came in at 48.5 below the previous reading 48.9. Moody’s affirmed Japan the A1 rating with a stable outlook.  Nikkei boosted by Yamato Holdings +4.06%, Hino Motors Ltd. +3.75%, Trend Micro Inc. +3.60, and Taisei Corp. +3.30%.

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Nikkei Technical Analysis

The Nikkei index finally today rallied to fresh YTD high, as the bullish momentum is intact and the index trading above all major daily moving averages. A warning signal might be that the RSI index has reached overought levels above the 70 mark. On the upside resistance for the Nikkei stands at 22,781 today’s high, a break above, will set the stage for a move up to 22,950 the high from October 15th, 2018, above this level, the next resistance comes in at the highs seen on October 8th, 2018. On the downside, immediate support stands at 22,750, today’s low and then at 22.065 the low from October 19th, a convincing break below might drive prices down to 21,357 the 50-day moving average.

In Asian fx markets, USDJPY trading 0.07% higher at 108.61 the Aussie dollar trades 0.19% lower at 0.6839, while NZDUSD trades 0.32% lower at 0.6401 versus US Dollar. Gold trades slightly higher today at 1,491, while WTI crude oil is 0.55 lower at $55.66 per barrel.

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