Dow and Nasdaq 100 hold firm, while Nikkei 225 Rallies

Article by IG Chief Market Analyst Chris Beauchamp

Dow Jones, Nasdaq 100, Nikkei 225: Analysis and Charts

Dow edges back from peak

\u200bThe index continues to consolidate just below the record high, having gained a remarkable 16% in almost seven weeks.\u200bSo far there is little sign of any pullback materializing, though it would take less than a 4% drop to return to 36,000. Initial support could be found around 36,954, the previous high.

\u200bAll eyes are now on whether the index can, from its overstretched position, succeed in building a seasonal ‘Santa Rally’.

Dow Jones Daily Chart

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\u200bNasdaq 100 sits just below a record high

\u200bThis index touched its previous record high yesterday, though it shied away from hitting a new milestone.\u200bAs with the Dow, there is presently no sign of a pullback in the works, so the focus is on whether buyers can succeed in eking out a new record high before the end of the year.

\u200bIn the short-term, some weakness may target the 16,000 area, where the price consolidated in November before its most recent leg higher.

Nasdaq 100 Daily Chart

\u200bNikkei 225 rallies after BoJ policy decision

\u200bThe Bank of Japan (BoJ) left policy unchanged at its latest meeting, weakening the yen and bolstering Japanese stocks that have dropped back from their November highs over the last month. \u200bRecent action has seen the price repeatedly test and then hold above the 50-day simple moving average (SMA). The BoJ’s decision appears to have given the green light to the index to make some new headway to the upside.

\u200bA challenge of the November highs at 33,830 now looks likely. From there the highs of June at 34,015 come into view, with a longer-term outlook supporting a move to fresh multi-decade highs.

Nikkei 225 Daily Chart